MARKETING MIX

Marketing mix is the set of marketing tools that the firm uses to pursue its marketing
objectives in the target market.
Tools of marketing: -From a buyer’s point of view, each marketing tool is designed to
deliver a customer benefit. Seller 4P’s correspond to the customer 4 C’s.
Four P’s Four C’s
Product Customer solution
Price Customer Cost
Place (distribution) Convenience
Promotion Communication
Winning companies will be those who can meet customer’s needs economically and
conveniently with effective communication.
Marketing mix is also known as 4P’s of marketing. Optimizing the marketing mix is the
primary responsibility of marketing. By offering the products, with the right combination
of the 4P’s,marketers can improve their results and marketing effectiveness.

PRODUCT DECISIONS: -Product refers to tangible, physical products as well as

services. When a consumer purchases a product, it also includes the post-sales
relationship with the company.i.e.customer service & warranty. Some examples of the
product decisions to be made: -
 Brand name
 Functionality
 Styling
 Sizes
 Quality
 Packaging
 Repairs
 Warranty
 Accessories and services

PRICE DECISIONS: -Price is the amount paid for a product. Excahnging goods and/or
services is termed as Barter.
 Pricing strategy (Skim, Penetration)
 Suggested Retail Price
 Volume discounts & wholesale pricing
 Cash & early payment discounts
 Seasonal Pricing
 Bundling

PLACE DECISIONS: -Place represents the location where a product can be

purchased.e.g.
 Distribution channels
 Market coverage (inclusive or exclusive distribution)
 Inventory management
 Warehousing
 Transportation
 Reverse Logistics
PROMOTION DISCOUNTS: -Various aspects of marketing communication.i.e the
communication of information about the product with the goal of generating a positive
customer response. Methods of sales promotions are: -
 Promotional Strategy (Push, Pull etc.)
 Advertising
 Personal Selling
 Sales Promotion
 Public relations & publicity

SALES PROMOTION: -An activity designed to boost the sales of a product or service.
It may include an advertising compaign, a free-sample compaign, offering free gifts,
arranging demos or exhibitions, setting up competitions with attractive prices, temporary
price reductions, door-to-ddor calling, telemarketing, personal letters.
Sales promotion is about ‘action’. It is about stimulating customers to buy a product.
It is not designed to be informative-a role which advertising g is much better suited to.
Sales promotion can be directed at: -
(i) The ultimate consumer (a ‘Pull Strategy’, encouraging purchase)
(ii) The distribution channel (a ‘Push Strategy’, encouraging the channels to stock
the product. This is usually known as “Selling into the trade”. Trade sales
promotion techniques are: -
 Trade allowances-Short term incentive offered to induce a retailer to stock upon a
product.
 An extra commission paid to retail employees to push products.

METHODS OF SALES PROMOTION: -

1. Price promotions: -Price promotions are also commonly known as Price Discounting.
These offer either: - (i) a discount to the normal selling price of a product such as happy
hours. (ii) More of the product at the normal price.e.g.25% extra.
Increased sales gains from price promotions are at the expenses of a loss in profit-so
these promotions must be used with care.
2.Coupons
3.Gift with purchase: -Very common promotional technique. Also known as ‘Premium
promotion’, in that consumer gets something in addition to the main purchase.e.g.
Subscription based products (magazines), electronic items.
4. Competitions & Prizes: -Subjected to legal restrictions.
5. Money refunds: -Here, a consumer receives a money refund after submitting a proof of
purchase to the mabufacturer. These schemes are often viewed with suspicion by
customers-particularly if the method of obtaining a refund looks unusual.
6.Frequent User/Loyalty incentives: -Repeat purchases may be stipulated by frequent
user incerntives.e.g.many frequent flyer or user schemes used by airlines.
7.Point-of-sale displays: -Research into consumer buying behavior in retail stores
suggests that a significant proportion of purchases results from promotions that customers
see in the store. Attractive, informative and well-positioned point-of-sale displays are
therefore, very important part of the sales promotional activity in retail outlets.
 DISTRIBUTION CHANNELS

The objective of distribution is to make conveniently available the goods to the

largest number of consumers in the required quantities where and when needed. The
development of the arrangement necessary to transfer ownership of a product and
transport the product from where it is produced to where it is finally consumed. So, the
channel of distribution means the ways for getting the product to the market. Apart from
middlemen such as retailers and wholesalers, distribution channel always includes
producer and the final consumer of the product.

Five channels are widely used in marketing tangible products to ultimate products: -
I. Producer Consumer. Also known as Direct Distribution. The
shortest, simplest distribution for consumer goods and involves no middlemen.e.g the
producer may sell its products door to door or by mail, a publishing house may sell its
books on a house-to-house basis, customer places the order by visiting the marketer’s
website or through a toll-free telephone ordering, when a producer also operates their
own retail outlet.
II. Producer Retailer Consumer
Many large retailers buy directly from manufacturer.eg.Wal-Mart; a departmental store
has increased its direct dealings with producers.
III.Producer Wholesaler Retailer Consumer
Traditional channel for consumer goods. Small retailers and manufacturers find the
channel, an economical and feasible choice.
IV. Producer Agent Retailer Consumer
Instead of using wholesalers, many producers prefer to agents, as middlemen to reach the
retail market.
V. Producer Agent Wholesaler Retailer Consumer
To reach small retailers, producers often use agent middlemen, who in turn call on
wholesalers that sell to large retail chains and for small retail stores.