Exploring Your Market Developing The Right Marketing Mix

Entrepreneurship
Exploring Your Market

Markets & Marketing
 Market = those people or organizations that
may be interested in buying a product or
service, have the resources to buy it, and are
permitted by law or regulation to do so
 Marketing = satisfying the customer at a
profit
 The business function that identifies your
customers and their wants and needs
 The engine that drives ALL business decisions
Entrepreneurship, 2nd Edition © 2010 Pearson Education, Upper Saddle River, NJ 07458.
All Rights Reserved.
Mariotti and Glackin with NFTE 2
Marketing Research
 Primary = research conducted directly
on a subject or subjects
 Secondary = research carried out
indirectly through other existing
resources
Primary Research Methods
 Personal interviews
 Telephone surveys
 Written surveys
 Focus groups
 Observation
 Tracking
 Review of books & records
Secondary Research Methods
 Online searches
 Article & book searches
 Competitor websites
Visualize Your Customer
Use market research to find out:
 Who your potential customers are
 Where you can reach them
 What they want and need
 How they behave
 What the size of your potential market

is
Customer Research
 Surveys
 Focus groups
 Research reports
Industry Research
 Interviews
 Observation
 Tracking
 Written sources of statistical data
 Books & articles
 Competitor websites
 Trade associations & chambers of commerce
Customer Decision-Making
 Awareness
 Information search
 Evaluation of alternatives
 Decision to purchase
 Evaluation of purchase
Owning Customer Perception
 Features create benefits.
 Feature = a fact about a product or service
 Benefit = what the feature can do to meet
a customer’s needs
 Needs, wants, and demands are
different.
Market Segmentation
Market segment = customers who have
similar response to a certain type of
marketing
Segmentation methods
 Geographic
 Demographic
 Psychographic
 Behavioral
Product Life Cycle (PLC) Stages
1. Introduction
2. Growth
3. Maturity
4. Decline
Where is your product/service in the PLC? Is

your market saturated?
Market Positioning
 Distinguish your product/service from others
offered to your market segment.
 Goal is to clearly communicate how your
product/service differs from competitors.
 Sample positioning statement:
(General Motors) is the (leading US
automobile maker) that (provides affordable
cars) to (American families).
Entrepreneurship
Developing the Right Marketing Mix

Marketing Mix = the 4 Ps
1. Product
2. Price
3. Place
4. Promotion
Goal: Bring the right product to the

right place at the right price with the
right promotion.
Products (and Services)
 Products & services are defined by:
 Physical attributes
 Performance characteristics
 Pricing
 Branding
 Delivery
Focus the Brand
 The primary product benefit is “owned”
by the company.
 Ford’s Edsel – lacked focus, too many
features  failure
 Ford’s Mustang – tightly focused on
target market of 20-30 year olds 
success
Ways to Build a Great Brand
 Provide high-quality products/services
 Maintain high ethical standards
 Define the product/service clearly
 Treat employees well
 Make ads positive & informative
 Associate the company with a charity
 Be involved in the community
What Does the Price Tell Consumers
About Your Product/Service?
 Strategies:
Keystoning: doubling the costs

 Cost plus: cost plus profit margin
 Penetration: low price early in PLC
to gain market share

 Skimming: high price early in PLC
before competitors enter market

 Meet or beat the competition
 Mark-ups
Place
 Type of business affects the location
that works.
 Who are your customers?
 Where do they shop?
 Goal: Find a location affordable for you

yet also convenient for customers.
Promotion
 Using advertising + publicity to get
your market message to your
customers
 Advertising (purchased): billboards,

TV ads, magazine ads
 Publicity (free): mentions in media

such as articles, stories on TV, etc.
Promotional Ideas
 Advertising specialties  Networking
 Banner ads  Newsletters
 Billboards  Print media
 Blogs  Promotional clothing
 Broadcast media  Public speaking
 Brochures  Samples/demos
 Business cards  Special events
 Catalogs  Sponsorships
 Coupons  Telemarketing
 Direct mail  Toll-free numbers
 Directories  Websites
 Flyers
Marketing Materials
 Examples include brochures, posters,
order forms, business cards, & invoices.
 Should reinforce competitive advantage
 Serve 3 functions
1. Help you organize your thinking
2. Enable you to teach others in company
about the business
3. Enable you to sell product/service
Media
 Print
 Television
 Radio
 Web
 Provide reach & frequency
Advertising
 Paid print advertising includes newspapers,
magazines, newsletters, & Yellow Pages &
other directories.
 Print advertising components
 Headline (title)
 Deck (subhead)
 Copy (text)
 Graphics (photos or drawings)
 Logo
Publicity
 Use media to generate publicity
 Mail/fax pitch letter and press release
 Pitch letter “pitches” the story of your
business
 Press release provides facts to answer:
who, what, when,where, why, how?
 Follow up with phone call
Philanthropy
 Giving money, time, advice, skills to help
minimize or eliminate social, environmental, or
political problems
 Foundations are nonprofits that raise funds for
charities that assist people, animals, the
environment, and other causes.
 Many philanthropic foundations were started by
entrepreneurs.
 Philanthropy creates goodwill: reputation, name
recognition, positive customer relations.
Cause-Related Marketing
 Inspired by commitment to a social,
environmental, or political cause
 Simple way to work philanthropy into
your business
 Examples:
1. Donate fixed % of revenue to charity
2. Donate product/service
3. Encourage employees to volunteer
Marketing as a Fixed Cost
 Marketing costs are money that is needed to
drive sales.
 Should not be budgeted as a percent of sales
 Calculate Breakeven Units to determine
whether the business is selling enough to
cover the marketing costs
 Breakeven units = Fixed Costs (per month or
per year)/Gross profit per unit

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Entrepreneurship

Exploring Your Market

 Where you can reach them

 What they want and need

 How they behave

 What the size of your potential market

Where is your product/service in the PLC? Is

Developing the Right Marketing Mix

Goal: Bring the right product to the

 Cost plus: cost plus profit margin

 Penetration: low price early in PLC

to gain market share

before competitors enter market

 Goal: Find a location affordable for you

 Advertising (purchased): billboards,

 Publicity (free): mentions in media

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