Business Marketing Final Module

`Republic of the Philippines
President Ramon Magsaysay State University

College of Accountancy and Business Administration
(Formerly Ramon Magsaysay Technological University)
Iba, Zambales, Philippines
Tel/Fax No.: (047) 811-1683
MODULE
CONTENT
IN S
BUSINESS MARKETING
MODULE 1: THE VALUE OF MARKETING
INTRODUCTION.............................................................................................................................1
Prepared by:
What is MARKETING?.....................................................................................................................2
THE BASIC CONCEPTS OF MARKETING...................................................................................2
GRACE P. GIRON, MBA, LPT
MARKETING PHILOSOPHIES.......................................................................................................3
Instructor
BENEFITS OF MARKETING..........................................................................................................4
What Is STRATEGIC PLANNING?.................................................................................................4
STRATEGIC PLANNING AND MARKETING PLAN..................................................................4
ACTIVITY........................................................................................................................................7
EXERCISES.....................................................................................................................................9
MODULE 2: THE ENVIRONMENT OF BUSINESS

INTRODUCTION...........................................................................................................................11
ACTIVITY......................................................................................................................................13
EXERCISES...................................................................................................................................13
MODULE 3: MARKET SEGMENTATION

INTRODUCTION...........................................................................................................................15
What is MARKET SEGMENTATION?.........................................................................................15
MARKET CLASSIFICATION.......................................................................................................16
CONSUMER AND INDUSTRIAL MARKET...............................................................................16
MARKET TARGETING AND POSITIONING.............................................................................16
STRATEGIES ON MARKET COVERAGE..................................................................................16
ACTIVITY......................................................................................................................................18
EXERCISES...................................................................................................................................18
MODULE 4: CONSUMER BUYING BEHAVIOR

INTRODUCTION...........................................................................................................................19
What is CONSUMER BUYING BEHAVIOR?..............................................................................19
FACTORS AFFECTING CONSUMER BUYING BEHAVIOR...................................................20
BUYER'S DECISION PROCESS...................................................................................................21
INDUSTRIAL MARKET AND BUYING BEHAVIOR................................................................22
CHARACTERISTICS OF INDUSTRIAL MARKET....................................................................22
TYPES OF BUYING SITUATION................................................................................................24
PARTICIPANTS IN THE BUYING CENTER..............................................................................24
ACTIVITY.......................................................................................................................................24
EXERCISES....................................................................................................................................27
MODULE 5: UNDERSTANDING PRODUCT

INTRODUCTION...........................................................................................................................28
STEPS IN PRODUCT DEVELOPMENT.......................................................................................28
PRODUCT LIFE CYCLE...............................................................................................................30
IMPORTANCE OF KNOWING THE LIFE CYCLE OF A PRODUCT.......................................30
KNOWING THE PRODUCT..........................................................................................................31
CHARACTERISTICS OF SERVICE.............................................................................................31
CLASSIFICATION OF PRODUCTS.............................................................................................31
DIFFERENCES BETWEEN CONSUMER MARKET AND INDUSTRIAL MARKET.............33
PRODUCT BRANDING.................................................................................................................33
PRODUCT PACKAGING..............................................................................................................34
ACTIVITY......................................................................................................................................35
EXERCISES...................................................................................................................................37
MODULE 6: PRODUCT PRICING

INTRODUCTION...........................................................................................................................38
PRODUCT PRICING......................................................................................................................38
What is PRICE?...............................................................................................................................38
PRICING OBJECTIVES.................................................................................................................39
IMPORTANCE OF PRICE.............................................................................................................39
REASONS FOR PRICE CHANGE.................................................................................................40
ACTIVITY......................................................................................................................................41
EXERCISES...................................................................................................................................42
MODULE 7: PRODUCT DISTRIBUTION

INTRODUCTION...........................................................................................................................43
DISTRIBUTION CHANNELS.......................................................................................................43
LEVELS OF CHANNEL DISTRIBUTION....................................................................................44
WHOLESALING AND RETAILING.............................................................................................44
ACTIVITY......................................................................................................................................45
EXERCISES...................................................................................................................................46
MODULE 8: PRODUCT PROMOTION
INTRODUCTION...........................................................................................................................47
PRODUCT PROMOTION..............................................................................................................47
TYPES OF PRODUCT PROMOTION...........................................................................................47
TYPES OF PROMOTIONAL STRATEGIES................................................................................50
ACTIVITY......................................................................................................................................50
EXERCISES...................................................................................................................................52
MODULE 9: CAREERS IN MARKETING
INTRODUCTION...........................................................................................................................53
CAREER IN MARKETING............................................................................................................53
ACTIVITY......................................................................................................................................55
EXERCISES...................................................................................................................................56
ASSESSMENT...............................................................................................................................56
SUGGESTED READINGS...........................................................................................................56
RESOURCE AND ADDITIONAL RESOURCES.....................................................................56
Republic of the Philippines
Tel/Fax No.: (047) 811-1683
College/Department College of Tourism and Hospitality Management

Course Code ABM S3
Course Title Business Marketing
Place of the Course in the Program Minor Subject
Semester & Academic Year First Semester AY 2020-2021
MODULE 1
THE VALUE OF MARKETING
INTRODUCTION
No organization or company can exist without marketing. Marketing is the lifeblood of any organization.
The success of a company lies on the efficiency of its marketing people with the cooperation and coordination of
other employees from other departments. As emphasized by Kotler and Armstrong (2001) in the book, Principles of
Marketing, "because customer value and satisfaction are affected by the performance of other functions, all
departments must work together to deliver superior value and satisfaction. Marketing plays an integrative role to
ensure that all departments work together toward this goal." Thus, without the assistance of marketing people, no
organization or firm can cope with the competition caused by the dynamism of marketing.
Marketing is present in all areas of our lives. The moment we get up from bed, there is marketing.
Marketing is the reason why we buy the clock, which we set to alarm in the morning to wake us up. The television
program or soap opera we choose to watch is the result of the promotion effort of the television network competing
with other television networks for audience attention. Television networks compete by offering better story line of
programs, more game shows with viewers' participation, and improved variety shows. All of these are geared toward
enhancing the network's viewership rating. The food that we choose to eat is a result of marketing. We patronize a
certain brand of soap, shampoo, toothpaste, and other oral care products because of marketing. As we go to office or
school, the billboards that we see, the posters, and tarpaulins along the way promoting various services or product
are forms of marketing strategy.
At board meetings or during presentations, our posture and our choice of apparel for the occasion are
definitely influenced by the concept of endorsements or marketing. Thus, marketing is part of our everyday life.
INTENDED LEARNING OUTCOMES

At the end of this module, students are expected to explain:
1. the meaning of marketing;

2. the basic concepts of marketing;
3. the importance of marketing;
4. how the different marketing philosophies varies;
5. the importance of planning 'in an organization; and
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6. how strategic planning differs from marketing plan.
DISCUSSION
What is MARKETING?
The field of marketing is broad and dynamic. It involves not only product creation, but also pricing the
offering wisely in order to attract the right market and promoting and distributing the products to identified outlets
places. Marketing is concerned with maintaining high customer satisfaction and continuously building and keeping
good relationship with the market.
THE BASIC CONCEPTS OF MARKETING

Needs - refer to situations in which something is missing and has to be satisfied
Wants - are the preferred products of an individual that will satisfy his needs. Individual product preference is
strongly influenced by one's personality or culture.
Demand - involves one's need or wants for products backed up his capacity to purchase a product
HIERARCHY OF NEEDS BY MASLOW
 According to Abraham Maslow's hierarchy of needs, there are several levels of human needs. Starting from the
bottom, which is known as the Physiological Needs, include the need for food, shelter. This level is followed
by Safety and Security Needs, which consist of the things that make one feels secured and safe, like owning a
house, security of tenure, insurance, etc. Social Needs refer to one's sense of belongingness to a group or
association, like being a member of a choir or an officer of faculty club or any distinguished association or
organization.
 Next level is the Esteem Needs or the individual's needs or strong desire be recognized of his efforts and
accomplishments. The last level in the hierarchy of needs is the Self-Actualization Needs. It involves the
continuous improvement of one’s talent, skills, and knowledge by further studying to be shared or given back to
the society.
 Exchange and Transaction – in transaction, terms and conditions, date of transaction, place of transaction,
amount involved, and other greed upon conditions are present; while exchange involves getting something in
return.
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 Market - refers to people patronizing or already using the company’s products or availing its various services.
It also includes those who would avail of the company's products in the near future. Thus, market refers to both
the actual and potential buyers.
 Product - anything that a buyer buys. It is anything that a company offers to satisfy the market's needs or
wants.
 Services - Kotler (2001) defined service as “any activity or benefit that one party can offer to another that is
essentially intangible and does not result in the ownership of anything."
 Marketing Mix known as the Four Ps in marketing, which means product, price, place, and promotions.
Each has to be well coordinated by the firm so as to have good marketing activities.
MARKETING PHILOSOPHIES
 Product Concept or Philosophy - A company is said to be following product concept and philosophy it
product performance is given priority. It means no product leaves the assembly line if it is not of high
quality.
 Production Philosophy - Those Companies that value the importance of the availability of products at all
times with a reasonable price follow the production philosophy.
 Marketing Concept – firms determine first the needs and wants of their potential market, then device
ways, products, or services to satisfy these needs and wants more effectively and efficiently than their
competitors.
 Societal Marketing Concept - firms look first into the welfare of society in general and deliver their
offering in way that satisfies their market more electively and efficiently than their competitors
 Selling Philosophy - firms hire marketers or sales people to do aggressive marketing for the firm's products
or services.
PLANNING THE BUSINESS ENTERPRISE
- Business enterprise involves - great planning and decision-making, particularly when it is still in the
conceptualization stage. An individual planning to put up a business need to consider the following: what
business to enter, who will be the target market, how to beat competitors, where to get the capital needed
for the investment, to purchase or not to purchase an equipment and how to better serve its market.
IMPORTANCE OF BUSINESS PLANNING
Through planning, one can:
 apply for loans;
 determine the needed capital;
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 evaluate actual performance against set targets;
 lessen impact of business failure;
 lessen risk of doing business;
 minimize mistakes;
 minimize or eliminate losing capital because everything is well thought of;
 result in better preparedness for sudden development;
 lead to better coordination among different departments in the company; and
 program activities in advance.
BENEFITS OF MARKETING
 It creates employment.
 It helps develop more and better products,
 It provides better profit.
 It improves the quality of life,
 It produces more entrepreneurs.
 It contributes to economic development.
What Is STRATEGIC PLANNING?
 Marketing Guru, Philip Kotler, defined Strategic Planning as a process developing and maintaining a
strategic fit between the organization's goals and capabilities and its changing marketing opportunities.
 Strategic Planning starts from the moment the top management at the corporate level forms the company's
mission statement.
 A mission statement stipulates what the firm values and its reason for existence. This is cascaded
down to all the employees and will serve as their guide in the performance of their tasks.
STRATEGIC PLANNING AND MARKETING PLAN
 Strategic planning involves deciding on marketing strategies that' will help a company achieve its overall
strategic objectives.
 Marketing plan includes the executive summary, current marketing situation environmental analysis,
marketing objectives, strategies, action programs, budget, and controls.
PARTS OF MARKETING PLAN
1. Executive Summary – presents the highlights of the plan. It is the overview of the proposed plan.
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2. Current Marketing Situation – provides data on the present product, its market, and how products are
distributed and promoted.
3. Environmental Analysis – discusses the various external factors that affect the marketability of the
product. This defines the products strength and weaknesses as well as the various threats and opportunities
facing the products.
4. Objectives – consist of marketing goals in the area of the sales, target market, positioning, market share,
and profit.
5. Marketing Strategies – consist of the company game plan, indicating how objectives will be achieved.
6. Actions Programs – indicate the steps that the company would undertake to ensure that marketing
strategies would be achieved. Includes identifying the persons involved, the timeframe, and the budget.
7. Budget – is an important component that puts into details the cost of implementing the marketing plan.
8. Controls – indicate how progress will be monitored and reviewed by the management.
PROCESS OF STRATEGIC PLANNING
 Drafting the Company’s Mission
- The company’s statement of purpose is called its mission. It describes the company’s reason of being or
what the company wants to achieve.
- The clear mission statement of a firm serves as guide to all its employees
SETTING OF COMPANY’S OBJECTIVES
This consist of detailed supporting statements or objectives intended for the different management levels to achieve.
Examples of a company’s objectives are:
a. to build profitable customers relationship;

b. to increase company’s sales; and
c. to increase company’s product awareness.
DESIGNING THE COMPANY’S BUSINESS PORTFOLIO
Product and business are equivalent to the portfolio. Assisted by the company’s mission statement and set
objectives the company must evaluate its business portfolio.
There are two ways in which a firm may assess its business portfolio.
1. Analysis of the Current Portfolio of the Company. In here, the company assesses the products and
decides which among the businesses must be given more investment, less investment, or no additional
investment at all.
2. Development of the Company’s Growth Strategy. There is a need for companies to appraise its SBU’s to
determine which among the SBU’s will be given support and up to what extent.
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What is SBU?
The Strategic Business Unit (SBU) is a single business or collection of businesses that has a distinct mission, a
responsible manager, and its own competitors and that is relatively independent of other business units. (Hutt and
Speh 2013)
SBU’s can pursue any of the following strategies:
 Build it Share. More investment is needed by companies to achieve this.
 Hold its Share. Companies may invest just enough to maintain or hold their share at the current level.
 Harvest. Milking its short term cash flow regardless of the long-term effect.
 Divest. Company may sell the SBU or purchase out the product and use the resources elsewhere.
Growth-Share Matrix or the Boston Consulting Group (BCG) Matrix
A company can evaluate its current products or portfolio with the growth-share matrix or also known as the
Boston Consulting Group (BCG) matrix.
 Stars – are high-growth/high-share product that needs heavy investment to achieve growth.
 Cash Cows – are low-growth/high-share business or products. It needs less investment to maintain market
share.
 Question Marks – SBU’s with low market share in high-growth market. Question marks need more cash
to hold its market share.
 Dogs – have low share and low-growth status. The cash generated may just be enough for themselves but
does not promise to have big source of profit.
GROWTH STRATEGIES
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Product/market expansion grid is a portfolio-planning tool for identifying company growth opportunities through
market penetration, market development, product development, or diversification. (Armstrong and Kotler 2003)
PRODUCT/MARKET EXPANSION STRATEGIES
a. Market Penetration Strategy is achieved by increasing or adding sales of current products to existing or
current market.
b. Market Development Strategy is where market is identified or developed for existing or current company
products.
c. Product Development is a strategy where companies offer new or improved products to current market
segments.
d. Diversification is a growth strategy where companies acquire businesses outside their existing or current
products and markets.
 Coordinating Activities to Different Functional Areas

The main focus here is to coordinate the marketing resources and activities to different departments within
the company to achieve the set objectives and strategies of the firm.
ACTIVITY
I. Identification. Distinguish the word or concept that will complete the following sentences. Write your
answer on the blank.
1. The 4Ps of marketing, namely product, price, place, and promotions are also known as
___________________.
2. Demand is the result of need and wants plus __________________.
3. __________________ is a written document that consists of the executive summary, current marketing
situation, marketing objectives, marketing strategies, programs, budget, and controls.
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4. A marketing philosophy that makes consumers to favor products because of availability and affordability is
known as _________________.
5. ______________________ refers to a statement of an organization or company's purpose or reason of

being.
6. ______________________ refers to the choice or preferred products of an individual as influenced by

culture or personality.
7. A marketing philosophy where firm hires sales people to do aggressive marketing efforts to promote the
products is called _____________________.
8. _______________________ is communication that informs and persuades the public to accept or purchase
the companies' products.
9. _______________________ provides the highlights of the marketing plan.
10. The process of continuously and profitably satisfying market needs and wants better than competitors is
called ____________________.
11. A single business or collection of businesses of a firm that has its own mission, budget, competitors, and
manpower is known as _____________________.
12. _______________________ refers to low-growth, high-market share business or product of a company.
13. ____________________ are SBUs with low-market share in high-growth market.
14. ____________________ are high-growth, high-market share businesses or products that need heavy
investment.
15. ____________________ is a market philosophy which assumes that consumers will favor products that are
available and cheap.
II. Gap-Fill. Choose the right answer from the words in the box. Write your answer on the line provided
before each number.
a. control g. physiological
b. budget h. safety and security needs
c. strategies i. self-esteem needs
d. environmental analysis j. cash cows
e. selling concept k. dogs
f. consumer market l. industrial market
____ 1. It indicates how progress will be monitored and reviewed by the management.
____ 2. A marketing philosophy where firms hire marketers to do aggressive marketing.
____ 3. It refers to the group of people who purchase goods for personal consumption.
____ 4. It consists of people who purchase products to produce another product.
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____ 5. It is the first level in the hierarchy of needs of Abraham Maslow.
____ 6. It is the level in the hierarchy of needs where security of tenure and owning a house are desired:
____ 7. It details the cost of producing a product or implementing a plan.
____ 8. It refers to the individual's desire to be recognized for their efforts and accomplishment.
____ 9. It is the evaluation of the different factors that affect the operations of the business.
____ 10. It refers to the low-market share and low-market growth product category.
____ 11. It consists of the various ways that business intends to compete in the market place.
____ 12. It is an SBU category that needs less investment to maintain market share.
EXERCISES
DISCUSSION QUESTIONS:
1. Why is it important for a company to have a written plan?
2. What is the role of marketing in strategic planning?
3. Differentiate the marketing management philosophies.
4. What important roles does marketing play in our economy?
CONCEPT APPLICATION:
1. Think of two (2) convenience stores where you normally purchase your needs or you frequently visit.
Describe how you were satisfied and not satisfied by the two stores.
2. Between the two convenience stores that you thought of, which is better?
3. What particular needs or wants of the customers were satisfied by the two stores?
4. In which particular areas must the two convenience stores be improved?
MINI CASE
There are scenic places that local tourists and foreigners frequently visit in the city of Manila like
Intramuros, Rizal Park, National Museum, Manila Zoo, and Museo Pambata. Choose a place where the following
people would likely visit, and answer the succeeding questions:
1. Family
2. Businessmen or Entrepreneurs
3. Sports Enthusiasts and
4. Senior Citizens
5. Students
a. What are the needs and wants of the group of people? How can these be satisfied?
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b. How can the management of the scenic places improve the number of tourists' arrivals?
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Tel/Fax No.: (047) 811-1683
College/Department College of Tourism and Hospitality Managment

Course Code ABM S3
MODULE 2
THE ENVIRONMENT OF BUSINESS
INTRODUCTION
Any kind of business organization works within an environment. How a company deals with the
environment determines its success or failure. Business environment consists of factors that a company can control
and those that are uncontrollable. Controllable business factors are internal to the company. These include the
marketing mix—product, price, place, and promotion. Management decides what product to produce, how to
increase the level of production, how much will be the selling price of the product or services, how the products will
be distributed, what market to cover, and what medium of promotion to use to advertise products. Management also
has a big influence when it comes to establishing company policies. It is responsible for the proper implementation
of company's rules and regulations, and for organizing and controlling its employees.
On the other hand, uncontrollable business factors are external to the company. These include factors such
as demographic, economic, socio-cultural, political or government, technological, and climate or weather. Thus, for
any business entity to survive and to have a smooth and continuous operation, the environment needs to be closely
monitored to be able to anticipate its effect to the different marketing plans or programs of the company so that
necessary adjustments can be immediately made.

At the end of this module, students are expected to:
1. identify the various internal business environments;

2. recognize the different external business environment; and
3. differentiate controllable and uncontrollable environment factors.
DISCUSSION
TYPES OF BUSINESS ENVIRONMENT
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 Internal Environment
- These are forces that are close to the company and affect its interaction with its market. Micro-
environment is another term for this environment.
The micro-environment is composed of:
1. Firm/Company – represents the business enterprise that creates the product and sells or provides
services to identified market.
2. Distribution Channel –represents the organizations that assist a company to promote, sell, or
distribute products or services to actual and potential customers; examples of channels are retailers, as
well as wholesalers. It is also considered as marketing intermediaries.
3. Competitors – are business enterprises that offer the same products or alternative products that other
companies also offer, competitors provide the market with more choices.
4. Company’s Public – are organizations or groups that have direct or indirect interest to a company;
financial institutions like banks, the media, the general public, the government, and other citizen-
organized groups are some of the organizations that have interest to a company.
5. Suppliers – are firms that provide needed equipment, raw materials, office and other supplies to a
company.
 External Environment
- The bigger environment or the macro-environment is uncontrollable or more difficult for a company
to control.
Macro-environment is composed of the following:
1. Demographic Factor – include environmental factors such as the consumers’ profile – age, gender, education,
population, nationality, and religion. These factors are essential for a company to consider because variables
under the demographic factors constitute the characteristics of the market and these affect buying behavior.
An example for demographic factor is the issue on migration. The influx of people in an area means a greater
consumption on basic necessities, like food, and an increase in demand for clothing and housing. On the other
hand, such movement of people will mean decrease in demand for basic products in other areas.
2. Political or Legal Factor – consist of existing laws, ordinances, or government restrictions that affect or
influence the operation of a business.
3. Economic Environment Factor – includes those that influence the spending pattern or buying power of
consumers. Examples of economic factors that are essential to marketers are change in income distribution.
Other factors that may affect economic environment are family size, cost of products, and lifestyle of the
market.
4. Socio-Cultural Environment Factors – includes those that affect the values, behavior, or belief of society.
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5. Technological Environment Factor – deals with those factors that create or innovate products due to
technological advancement or modern machineries, gadget, or equipment.
6. Natural Environment Factor – affects marketing activities. Some issues in the natural environment are
increased pollution, shortage of raw materials, and no-biodegradable packaging.
ACTIVITY
Gap-Fill. Choose the right answer from the words in the box. Write your answer on the line provided before each
number.
a. internal f. macro
b. technological g. socio-cultural
c. economic h. economic
d. demographic i. distribution channel
e. intermediaries j. competitors
___1. Environment where individuals have the power to control
___ 2. Consists of new machinery, equipment
___ 3. Refers to inflation, employment rate, prices
___ 4. Factor consisting of a person's gender, educational attainment, nationality, status

___ 5. Type of environment considered as uncontrollable
___ 6. Decision influenced by beliefs, superstitions, and way of living
___ 7. Factor that includes change in spending pattern, change in income distribution, a change in income level
___ 8. Helps the company to promote and distribute products to actual and potential customers
___ 9. Business enterprise that offers the same products or alternative products that a company also offers
___ 10. Represents the firms that assist the company to promote, sell, or distribute products to the market
EXERCISES
Discussion Questions:
1. Cite specific examples on how the various internal and external environmental factors affect business.
2. Can a company become successful without considering the environment? Justify your answer.
3. Explain why intermediaries are important in business.
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Concept Application:
Mini Case
Provinces in the Visayas region have been greatly affected by typhoon Yolanda. There was massive loss of lives
and properties. Almost everything was washed-out.
1. In what way can the government assist businesses to start again?

2. What possible assistances can be extended to farmers, fishermen, and others?
3. What sources of income/ livelihood have been affected?
4. Is migration of people in affected areas a wise decision? Why or why not?
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Tel/Fax No.: (047) 811-1683
College/Department College of Tourism and HospitalityManagement

Course Code ABM S3
MODULE 3
MARKET SEGMENTATION
INTRODUCTION
Market segmentation refers to the process of dividing the market into distinct groups each group has
common characteristics. Segmentation is the initial step in targeting the market. Many companies recognize the
importance of understanding the diversity of the customers or market. This means understanding the needs of a
particular market and satisfying those needs. Segmentation is not treating the market as a homogenous group same
product are offered to all.

At the end of this module, students must be able to:
1. analyze the different types of market segmentation;

2. distinguish the two types of market; and
3. contrast the different strategies of market coverage.
DISCUSSION
What is MARKET SEGMENTATION?
- Market Segmentation refers to the process of dividing the market into distinct groups where each group has
common characteristics.
Segmentation is the initial step in targeting the market.
Many companies recognize the importance of understanding the diversity of the customers or market. This
means understanding the needs of a particular market and satisfying those needs.
Segmentation is not treating the market as a homogenous group where same products are offered to all.
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MARKET CLASSIFICATION
- These are various ways a company can divide or segment the market. This can be done through dividing
the market into different segments: demographic, geographic, behavioral, and psychographic
segmentation.
1. Demographic Segmentation, the market is divided based on variables such as age, gender income,
education, nationality, religion, and family cycle.
A publishing company, for instance, produces books intended for different age brackets or level of
education. There are books designed for preschool, grade school, high school, or those in tertiary level. The
same is true with milk suppliers. In supermarkets, consumers tend to buy milk products suitable for
different age groups – infants, toddlers, and adults. There are also milk brands especially made for pregnant
women and for the elderly.
2. Geographic Segmentation means the market is divided or segmented based on territory or geographical
units such as regions and cities (rural or urban).
3. Psychographic Segmentation groups the market according to lifestyle, personality, or social class.
4. Behavioral Segmentation divides the market into groups based on knowledge, attitudes, or the market’s
response to a product.
CONSUMER AND INDUSTRIAL MARKET

 Consumer Market refers to individuals who purchase products for their own consumption or personal
use.
 Industrial Market refers to the buyers who purchase products in order to produce another product.
MARKET TARGETING AND POSITIONING

- Market Targeting is the process of looking into the most attractive market that a company is capable of
serving. In choosing the right segment, it is necessary for a company to consider its resources.
- Product Positioning is the process of emphasizing a product’s best feature. One of the features can be the
product’s price, which can be the most reasonably priced product among varied competitors. Sometimes,
companies position their product or brand by emphasizing its benefits or effectiveness or its accessibility to
the market.
COMPETITIVE ADVANTAGE
- In order for a market to remember the product, a business enterprise must create its product’s competitive
advantage. A competitive advantage to the uniqueness of the company’s product that sets it apart from its
competitors. A competitive advantage of a product can be in a form of improved product feature, value for
money, or affordability of its price.
STRATEGIES ON MARKET COVERAGE

 Undifferentiated Market Coverage
- This strategy is used whenever a business enterprise offers an entire market with one type of product. It
ignores the segment differences of each market. It focuses on the similarities of the needs of the market
rather than the differences.
- Undifferentiated market coverage relies heavily on mass distribution and mass promotions of a product.
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Advantages:
1. With one-product-fits-all strategy, a company minimizes its product distribution, promotions, and
distribution costs.
2. Undifferentiated market coverage strategy aims to get a great number of customers by targeting
more than one segment of the market.
Disadvantages:
1. It is difficult to satisfy several segments of the market with one brand of product since each has
diverse characteristics and level of needs.
2. There may be a heavy competition in a particular segment of the market, making business
operations less profitable to the company.
3. Whenever competition is strong in one segment, a business enterprise tends to develop product
offering that focuses on the larger segment of the market; thus, satisfying the demand of the
smaller segment less.
 Differentiated Market Coverage

- This market coverage strategy targets several market segments, offering varied product designs.
Differentiate market coverage matches the product offered of the firms to the needs of the market.
Advantages:
1. It creates higher product sales because the products offered by the firm matches the customers’
needs and preference. Therefore, repeat product purchase is high and there is strong tendency of
the market to be loyal to the brand.
2. Due to heavy competition in differentiated market coverage, companies build strong product
positioning in a particular segment.
 Concentrated Market Coverage

- Companies with limited resources focuses more on utilizing concentrated market coverage strategy. For
this reason, they set a high product differentiation for customers to patronize their product offerings.
Advantages:
1. The company has strong product positioning because the company has high knowledge of its
market segment.
2. Companies experience high sales due to high product differentiation.
Disadvantages:
1. High risk is present particularly when a company falls short the customers’ expectations.
ACTIVITY
17
Gap-Fill. Choose the right answer from the words in the box. Write your answer on the line provided before each
number.
k. internal p. macro
l. technological q. socio-cultural
m. economic r. economic
n. demographic s. distribution channel
o. intermediaries t. competitors
___1. Environment where individuals have the power to control

___ 2. Consists of new machinery, equipment
___ 3. Refers to inflation, employment rate, prices
___ 4. Factor consisting of a person's gender, educational attainment, nationality, status
___ 5. Type of environment considered as uncontrollable
___ 6. Decision influenced by beliefs, superstitions, and way of living
___ 7. Factor that includes change in spending pattern, change in income distribution, a change in income level
___ 8. Helps the company to promote and distribute products to actual and potential customers
___ 9. Business enterprise that offers the same products or alternative products that a company also offers
___ 10. Represents the firms that assist the company to promote, sell, or distribute products to the market
EXERCISES
1. Discuss market segmentation is essential.
2. Differentiate the two categories of market.
3. Enumerate and differentiate the types of market segmentation.
4. Cite the importance of each market coverage strategies.
Group yourselves into five. Discuss among the members of your group how you would segment the market for
the following products.
1. Diet cola 9. Facial centers

2. Laptops 10. Fan magazines
3. Concerts 11. Soap operas
4. Malls 12. Sports shows
5. Condominiums 13. Coffee
6. Fine dining restaurant 14. Cellphones
7. Vegetarian restaurant 15. Music
8. Stiletto
18
Tel/Fax No.: (047) 811-1683

Course Code ABM S3
MODULE 4
CONSUMER BUYING BEHAVIOR
INTRODUCTION
Consumer buying behavior is comprised of all considerations a person takes when deciding what product to
choose or buy, where to buy the product, when to buy the product, how the product will be purchased, and why the
particular product or brand was chosen. This also includes other factors like buyer's characteristics that influence a
person's decision to buy a certain product or avail of particular services.

1. compare the different factors affecting buying decisions;

2. analyze what influences the market's purchasing decisions;
3. identify the industrial market and its characteristics; and
4. discuss the types of buying situation and the participants in the buying center.
DISCUSSION
What is CONSUMER BUYING BEHAVIOR?
- Consumer buying behavior is comprised of all considerations a person takes when deciding what product
to choose or buy, where to buy the product, when to buy the product, how the product will be purchased,
and why the particular product or brand was chosen. This also includes other factors like buyer's
characteristics that influence a person's decision to buy a certain product or avail of particular services.
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FACTORS AFFECTING CONSUMER BUYING BEHAVIOR
 CULTURAL FACTOR
- Cultural factor has the broadest impact on consumer buying behavior. This represents the basic values of an
individual including his beliefs and behavior, which are learned from family, schools, and other institutions
in society.
FOUR CATEGORIES OF SOCIAL CLASS STRUCTURE IN THE PHILIPPINES
Class A. This is equivalent to the upper-upper stratum in the United States. These are the elite or people who are
wealthy or those from well-known families. They own several businesses, houses, and cars, and can travel anywhere
at any given time. Mostly, their houses are filled with amenities.
Class B. People from this class are professionals and entrepreneurs. They may also have comfortable lifestyle and
good income. They live in well-furnished town house, condominium units or well-furnished houses in known
subdivisions or villages, possessing modern household conveniences.
Class C. This is the middle class, which is composed of workers who live in modest residences, and if located in the
city are often rented. In most situations, people who belong to Class C do not have the conveniences found in the
homes of those in the Class B. The middle class is composed of workers who often live in rented apartments and
earn average wage.
Class D. A big majority belong to Class D.

 This refers to the upper-lower class made up of skilled and unskilled laborers, low-waged earners.
 These are those considered doing menial job for minimal pay. A big majority of our people belongs to the
Class D. Sometimes, these individuals are lucky to be given regular jobs or regular source of income. Most
of these workers are paid on daily basis and that means—No work, No pay.
 It is hard for this group to improve their standard of living with limited opportunity to get employed and the
cost of education is high. It is with this condition that most companies or institutions focus their corporate
social responsibility (CSR) programs toward helping this group improve their standard of living.
 SOCIAL FACTOR
- Consumer buying behavior is also influenced by social factors such as family, reference groups, social
roles, and social status.
Reference groups refer to groups that can strongly influence the attitude and character of a person. The group,
which a person wishes to be part of, is referred to as the aspirational group Example of this is when a teenager
wishes to be a member of a professional photography club in the future. A membership group is where a person is
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a member. This group has direct influence on the person's decisions especially when it comes to his/her brand
choice.
Family members are strong buying market. Family is the most important consumer buying organization in society.
Parents always influence the brand choice of customers, especially the young ones. Companies are expected to know
the various purchasing roles of each member of the family.
 PERSONAL FACTOR
- People, depending on their age and position in the life cycle stage, desired different products.
- Family life cycle includes being adolescent, single, married, couple without child or couple with a child or
children, senior citizens or those in their 60 years and above.
 PSYCHOLOGICAL FACTOR
- Psychological factors cover those different areas that influence the market such as their motivation level,
beliefs, and way of looking at things or situation.
- Motivation refers to what stimulates a person to purchase a product or avail a service. A person's level of
motivation can be associated with the different levels of need as identified by Abraham Maslow in his
hierarchy of needs.
- Perception is a person's interpretation of the information around him that helps him form meaningful
scenario.
BUYER'S DECISION PROCESS

1. Need Recognition
2. Information Search
3. Evaluation of Alternatives
4. Purchase decision
5. Post-purchase Behavior
1. Need Recognition
- The initial step of a person in deciding to purchase a product is to recognize that he has a need that has to
be met. A person's desire for a product may be influenced by stimuli within himself, like feeling of hunger
or exhaustion that will be satisfied by food or rest. Need can also be influenced by external stimuli like
seeing a classmate with the latest cell phone model or reading a print ad showing amazing features of a
laptop. These stimuli can make a person consider purchasing a product.
2. Information Search
- The next step in buying decision process is the search for information related to the product. A well-
informed customer may be able to purchase better product for the same price.
3. Evaluation of Alternatives
- This involves using the gathered information to evaluate alternative brands in the choice set. In order to
effectively evaluate alternatives, consumers must: (a) synthesize information; (b) establish decision
criteria; (c) determine the type of alternatives; and (d) compare alternatives.
4. Purchase Decision
- This is the stage where customers choose the particular product to purchase from among the many
alternative brands.
21
Two factors that may affect their purchase decisions.
a. The perception or attitude of others about the customer's brand choice.
b. The unexpected situation - it is in the same way when a competing brand offers a much lower price or a
new product is launched in the market offering better features, price, or design.
5. Post-Purchase Behavior
- This is the last stage in the buying decision process. Post-purchase evaluation can be a learning experience
for consumers.
INDUSTRIAL MARKET AND BUYING BEHAVIOR

- Aside from the consumer market that purchases products for its own personal consumption, there also
exists the industrial market, which is a bigger market in terms of quantity purchased. Industrial market or
business-to-business (B2B) market purchase products for further production or processing and
manufacturing new products.
Industrial or B2B market includes the following:
1. Industrial market — is composed of industries such as manufacturing, mining, banking, retail trade,
wholesale trade, services, transportation, public utilities, and communications.
2. Resellers — are individuals who buy goods and resell them to end-users at a profit. Examples of resellers
are convenience stores, grocery stores, supermarkets, and department stores.
3. Government and institutional market — includes the local and national government agencies and the
public and private entities.
CHARACTERISTICS OF INDUSTRIAL MARKET
1. Close Supplier and Customer Relationship

2. Derived Demand
3. Direct Purchasing
4. Geographically Concentrated Buyers
5. Inelastic Demand
6. Larger but Fewer Buyer
7. Leasing
8. Professional Purchasing
9. Reciprocity
10. Several Buying Influences
1. Close Supplier and Customer Relationship

- A good business relationship is created and maintained by directing the company's marketing activities
toward creating and maintaining successful exchanges with the customers (Hutt and Speh 2013).
2. Derived Demand
- The demand for goods and services is derived from the demand of the consumers.
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3. Direct Purchasing
- Sales people from the manufacturing companies go to the industrial market for product sales. Industrial
market normally purchases products in volume.
4. Geographically Concentrated Buyers

- This allows manufacturers to easily reach their target market. When buyers are concentrated
geographically, manufacturers use more personal selling; while if buyers are dispersed,
5. Inelastic Demand
- This means that the companies demand for business products, which are not affected by price change.
6. Larger but Fewer Buyer

- Industrial market normally interacts with fewer but larger buyers. Buyers purchase in huge product quantity.
7. Leasing
- This is common to most firms in the industrial market. Industrial market players like suppliers and users
lease items such as delivery trucks for product distribution and storage houses for inventories.
There are advantages when an industrial player, either buyers or sellers, leases. Some of these advantages are
(Llanes and Jurado 1982):
a. Through leasing, a firm can still use its investment capital for other purposes.
b. Leasing is best for firms that have temporary needs for equipment or storage particularly when there is
construction going on.
c. Leasing is a good decision for firms that have small investments and firms that are new in the industry or
just starting. This means that the firm need not have to immediately buy equipment or machinery.
d. Leasing is also an effective way of getting distribution for new products. Thus, potential users may be more
willing to rent than buy.
8. Professional Purchasing
- Purchasing and selling in the industrial market necessitate either the firms' seller or buyer to undergo
professional training to effectively close a sale.
9. Reciprocity
- This means the company will purchase products from a firm (seller) only if the seller will also purchase
products from the buyer. Firms practice reciprocity as a solution to a declining sales volume.
10. Several Buying Influences

- In the industrial market, a team of buyers in the firm normally influences buying decisions.
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TYPES OF BUYING SITUATION
PARTICIPANTS IN THE BUYING CENTER

The group of people within an organization that makes purchase decisions is said to form the buying center.
Gilbert Harell (2002) stated that there are six participants in the buying center, namely:
1. The Gatekeeper— refers to the first person that a sales representative get in contact with. Gatekeepers
control the flow of business information into the buying center or firm.
2. Information seeker — searches for data that can be used during the purchasing process.
3. Advocates — are people who influence the buying center decisions. Their influence is obtain from their
expertise on particular topic and with their skills in interacting with other people outside the organization.
4. Users – are members of the organization who will use the product. They initiate the purchase of the product
and provide information as to specifications.
5. Decision Makers – are people who choose and approve suppliers or providers of product.
6. Buyers – are people who have the authority to contact suppliers and negotiate terms for products to be
ordered or purchased
ACTIVITY
Multiple Choice. Encircle the letter of the correct answer.
1. Includes decisions that persons make in choosing what product to buy, where to buy the product, when to buy,
how the products will be purchased, and why the particular product or brand was chosen
a. consumer buying behavior

b. consumer product attitude
c. consumer product decision
d. consumer brand awareness
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2. A person's interpretation of the information around him that makes him form a meaningful scenario
a. learning
b. perception
c. motivation
d. attitude
3. Refers to what stimulates a person to purchase a product or avail of a service
a. learning
b. perception
c. motivation
d. attitude
4. Involves changes in a person's attitude due to his experience
a. learning
b. perception
c. motivation
d. attitude
5. Factors that cover those different areas that influence the market such as their motivation level, beliefs, and way
of looking at things or situations
a. psychological factors
b. social factors
c. personal factors
d. cultural factors
6. The first person that a sales representative gets in contact with; controls the flow of business information into
the buying center or firm
a. advocates
b. buyers
c. gatekeeper
d. decision makers
7. People that influence buying center decisions; influence is obtained from their expertise on a particular topic
a. advocates
b. buyers
c. gatekeepers
d. decision makers
8. His duty is to search for data that can be used during the purchasing process
a. advocates
b. buyers
c. gatekeeper
d. information seeker
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9. The members of an organization who will use a product; they initiate the product purchase and provide
information as to specifications
a. advocates
b. buyers
c. gatekeeper
d. users
10. The person who chooses and approves the suppliers or providers of products
a. advocates
b. buyers
c. gatekeeper
d. decision makers
11. People who have the authority to contact suppliers and negotiate terms for products to be ordered or purchased
a. advocates
b. buyers
c. gatekeeper
d. decision makers
12. Describes a situation where a firm reorders on a regular basis
a. straight rebuy
b. modified rebuy
c. system purchase
d. team buyer
13. Describes a buying decision where a firm wants to make some changes to product specifications, process,
delivery or payment requirements, and other terms
a. straight rebuy
b. modified rebuy
c. system purchase
d. team buyer
14. Involves a total solution to the buyer's problems, not making separate purchases and decisions
a. straight rebuy
b. modified rebuy
c. system purchase
d. new-task buying
15. A bigger market in terms of quantity purchased
a. industrial market
b. government market
c. consumer market
d. reseller market
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EXERCISES
1. Enumerate the different that influence consumer buying behavior and explain each.
2. How does industrial market differ from consumer market?
1. Individuals act on their beliefs and some beliefs will make a person choose to buy a product or decide
otherwise. Choose two Asian countries and research on how people from these countries differ in the following:
a. choice of colors on the following occasion / situation

 New Year
 Mourning
 Wedding
 Conducting business
b. food choices
c. attitude toward product's brand
Prepare a short presentation that will show the differences of these two countries.
2. Form a group or team with five members each and present a role play on the following:
a. show why it is essential for any company to understand consumers' buying behavior; and
b. show how a business can better understand its market.
3. Explain the role that each member of the family plays in the following:
a. purchase of new appliance;

b. choice of buying a new car;
c. choice of place for family outing; and
d. choice of restaurant.
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Tel/Fax No.: (047) 811-1683
College/Department College of Accountancy and Business Administration

Course Code ABM S3
MODULE 5
UNDERSTANDING PRODUCT
INTRODUCTION
Companies exist because they have products to offer the market. The kind of products that the companies
have and the way those products are being offered will spell the difference between a good product, not-so-good
products, and a bad product offering. The challenge to companies or manufacturers is to develop products that arae
sensitive to market needs. If companies' products do not satisfy its market, it will fail unless product innovation or
modification is done.

1. evaluate the different steps in product development;

2. illustrate the different stages and strategies of the product life cycle;
3. analyze the reasons why products fail or become unsuccessful in the market;
4. explain the characteristics of service and classification of products;
5. differentiate consumer market and industrial market;
6. identify product branding. the consideration for choosing a brand name and its benefits; and
7. discuss product packaging, its importance and its different levels.
DISCUSSION
STEPS IN PRODUCT DEVELOPMENT
1. Idea Generation
- This is the initial stage in product development process wherein those involved determine the new product
to be offered to the market, which begins by gathering ideas through brainstorming.
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2. Idea Screening
- This is the stage in product development where ideas gathered are screened and evaluated. The objective of
idea screening is to eliminate poor or weak ideas. Companies must choose the most feasible idea, taking into
consideration the company's resources.
3. Product Concept Developments and Concept Testing
Product Concept Development - new product idea is concretized into meaningful and understandable terms.
Concept Testing — the product concept is tested to groups of target audience or market so as to determine if the
concept has indeed an excellent consumer appeal.
4. Market Strategy
- This involves different game plans of the company in relation to the product it intends to produce.
Marketing strategy consists of the strategy for the new product, its price, the strategy on product distribution, and the
product promotion to be used.
5. Business Analysis
- This consists of the analysis of the general situation of a company. This is making company assessment by
accomplishing the Strengths, Weaknesses, Opportunities, Threats (SWOT) Analysis.
S.W.O.T. Analysis
 Strengths — are known as internal positive. They refer to the various resources that the company has such
as capital, manpower, equipment, raw materials, and a good method or system of doing things. Abundant
supply of these resources and having them in good quality are considered strengths of the company.
 Weaknesses — are known as internal negative. These refer to resources that a company does not have or
resources that a company has in limited supply such as the lack of manpower or equipment; thus, making it
difficult for the company to aggressively compete in the marketplace.
 Opportunities — are recognized as external positive. Opportunities are challenges in the market that a
company may consider to exploit to its advantage if it has sufficient and good resources that it can utilize in
order to compete.
 Threats — are obstacles that may hinder a company or limit its capabilities to achieve its goal. Threats are
the conditions outside the company, which a company does not have the power to control. These conditions
or situations may have an impact to the company's operations. Therefore, the company must be prepared to
eliminate or avoid threats.
6. Budget
- The main consideration of any product development is the capital involved in the process. All aspects of
product development, including product distribution and promotion, involve budget.
7. Product Development
 This is the stage where actual production of the product is done.
8. Test Marketing
- Majority of companies produce and distribute products to selected geographical location only. This is done
in order for the company to know product acceptability of the market before going to full commercialization.
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9. Full Commercialization
 Full-scale production and distribution are achieved at this stage. It is expected that at this stage, the company is
now ready to face its competitors with great hope that the new product can provide not only profit on its part,
but also satisfaction of the needs and wants of its potential market.
PRODUCT LIFE CYCLE

Product Life Cycle or PLC describes the movement of a product through time.
Stages of Product Life Cycle (PLC)
Introduction Stage — is the stage in the PLC where investment is high. Company spends in terms of product
promotion, production, and distribution. This is marked by slow growth and in most cases at this particular stage,
there is no profit yet; or if there is profit gained, it is minimal or low.
Growth Stage — is where it gains tremendous improvement in terms Of sales as the product becomes popular and
widely accepted. With this market response, profit also increases. However, it is at this stage where competitors or
new players enter into the same product category and fiercely compete with the existing product.
Maturity Stage — is where product growth and sales stabilize, since the product has been in the market for a longer
time.
Decline Stage — is where profit continuously declines. At this stage, company decides whether to phase out the
product, maintain producing it, and reintroduce the product, or sell the brand.
IMPORTANCE OF KNOWING THE LIFE CYCLE OF A PRODUCT
1. Companies will have enough time to think of possible product replacement or enhancement for those
products that have reached the decline stage.
2. Companies will continuously think of a strategy to better serve its market and prevent a product to advance
toward the decline stage.
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3. Companies will become aware that sales and profit differ in various stages.
4. All departments in the company, such as marketing, production, research and development, and finance,
should collaborate in strengthening the product's market strategies in order to gain customers' loyalty
toward the product as it passes through PLC stages.
KNOWING THE PRODUCT
Product knowledge involves knowing product features, its competitive advantage, its usage, price benefits, and
how the product will satisfy a market need.
CHARACTERISTICS OF SERVICE
1. It is not homogeneous. It means that service offers quality variability. There is variation or difference as to
time and place a service is offered, the person providing the service, and how it is given.
2. Service is perishable.
3. The service provider cannot be isolated from service because the service provider is part of the service.
Thus, there is inseparability of characteristics in service.
4. The intangibility of service means it cannot be touched, tasted, or experienced.
CLASSIFICATION OF PRODUCTS
 Consumer Products — are intended for consumer market or end users who purchase for their personal
consumption or family consumption.
 Industrial Products — are intended for business market who purchases products for further processing or
for their own business use.
CLASSIFICATION OF CONSUMER PRODUCTS
• Based on How the Market Buys the Product
A. Convenience products are goods that are purchased frequently and with minimum effort on the part of the
market or consumers because these products are available anywhere and anytime.
Convenience goods can be categorized into:
 Staple Goods — are those that form part of consumer's regular consumptions like rice, coffee, milk, dairy
products, soap, or shampoo.
 Emergency Goods — refer to those products customers purchase during emergency. Examples are
batteries, sanitary napkins, or an umbrella — in case of unexpected heavy rain.
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 Impulse Goods — are those unplanned product purchases like playing cards, chewing gums, razors, and
chocolates. These items are normally placed near the checkout counters of convenience stores or
supermarkets.
 Shopping Products — are goods that consumers purchase with exerted effort and time. Consumer buys
shopping products by comparing products on the basis of price, design, durability, color, model, texture,
and features.
B. Specialty products, like in shopping products, are goods purchased with much effort on the part of the
consumer. However, here, consumers buy their preferred brands. Product brands are the strong reason for actual
purchase. Examples are signature perfumes, clothes, and bags.
C. Unsought products are consumer goods that are available in the market but consumers are not aware of
Examples are faucets with sensor, flashlight without batteries, etc. Another example of these products are those
products in the market that consumers know, but would not make effort to look or buy such as insurance, realty,
memorial lots, and encyclopedias. (Kotler et al. 2009)
 Based on lifespan
- Consumer products can be classified as durable and non-durable. Durable consumer products can last
for longer period of time, perhaps years. Examples are appliances, cars, luggage, personal computers,
or laptops. Non-durable consumer products are those that last for a short period of time only, like
toothpaste, shampoo, and canned goods.
 Based on Tangibility
- Products can be tangible and intangible. Those products that can be touched or stored like biscuits or
shoes are examples of tangible products. Services, like the one given by a repairman, or the services
given by a bank, hotel, or restaurants are considered intangible—for one can only experience, observe,
or enjoy the product. It does not result in the ownership of anything.
CLASSIFICATION OF INDUSTRIAL PRODUCTS
1. Materials and Parts

a. Raw materials consist of products necessary to produce another products like farm products. Examples of
which are eggs, vegetables, livestock and natural resource or product obtained from nature, like woods,
minerals, and oil.
b. Parts and materials are products that become a part or component of a finished product. Examples include
paper used by publishing companies to produce books, magazines, or newspapers; cement used by land
developers to build structure; and batteries as component of manufactured vehicles.
2. Capital Products
a. Installations consist of buildings and land, and major equipment like tractors, printing machines, and
generators.
b. Accessory equipment are products used by businesses necessary for their operation, but not as part of the
finished products. Examples are computers, cash register machines, freezers, and air conditioning units.
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3. Supplies and Services
a. Supplies include operating supplies like pens, paper, brooms, and other cleaning or maintenance supplies.
b. Services include legal assistance, auditing services, management consulting, and services of advertising
agencies that are normally provided by other business groups.
DIFFERENCES BETWEEN CONSUMER MARKET AND INDUSTRIAL MARKET
1. Consumer Market
a. Products are purchased by an individual or final user.
b. Products are purchased in small quantities or retail.
c. Products are purchased from retail stores or convenience store.
d. Purchase decision is usually done by the final user.
e. Consumer buys from different stores.
2. Industrial Market
a. This type of market has fewer but larger buyers.
b. Close supplier and customer relationship is strongly established.
c. Demand for products is derived from consumer market level of demand.
d. This type of market orders and buys products direct from manufacturers.
e. Buyers are composed of professional purchasers.

f. Purchase decision is not based on the decision of only one person.
PRODUCT BRANDING
A brand is composed of the name of the product and the logo or design that represents the product. Brand speaks
about certain attributes of a product that consumers are looking for.
A brand name is the word or words that represent the product. On the other hand, a brand mark is the design that
goes with the brand name. It is recognizable but cannot be uttered.
Considerations for Choosing a Brand Name
1. A good brand name must be distinct.
2. A good brand name is easy to pronounce and easy to remember.
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3. Legal requirement
4. The possibility of product expansion
Benefits of Product Branding
a. To distinguish one product to another.
b. The government provides protection to the registered owner of the brand.
c. Through brand name, a manufacturer can communicate the benefits of the product.
PRODUCT PACKAGING
Packaging refers to the process of making the wrapper, covering, or container of a product or the product package.
It involves company researches on the product's design, package color, and packaging materials to be used.
Product package refers to the container used by the company to protect, promote, and transport its product. It has a
product label or insert.
Label is part of a product package that contains information about the product.
Packaging is important because of the following reason:
1. It provides protection to the product.
2. It preserves the freshness of the product.
3. It assures easy handling and convenience of transport.
4. It can entice people to buy the product. A product's package is considered the "silent salesman."
5. A product package speaks about the product's quality and gives impression about the company's reputation.
Various Criteria for Selecting Packaging Materials
1. The product package must be able to provide sufficient product protection.
2. Companies must consider the cost of packaging materials to be used.
3. Packaging must have display value. It should be able to attract market with the packaging color and design.
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4. It must provide convenience for carrying the product. Most products in the market are placed in packages
that are not only good to look at but also easy to carry.
5. In terms of product size, companies must consider product's packaging size, as practiced by other firms
within the same industry.
Levels of Packaging
1. Primary package is the product's immediate container, like the bottle of medicines, the plastic container of
ice cream, among others.
2. Secondary package refers to another package that protects the primary package, like the box used to
contain the bottle of medicine. This is an added protection for handling especially during transport.
3. Tertiary package refers to the bigger package that totally supports the product, like the big boxes that hold
dozen of bottles or dozens of smaller boxes for safety transport or product shipment.
ACTIVITY
1. The initial stage in product development
a. idea generation
b. commercialization
c. concept testing
d. product concept development
2. The process wherein a concept is tested to a group of target market to determine its appeal to the consumers
a. idea generation
b. commercialization
c. concept testing
d. product concept development
3. The different game plans of the company in relation to the product it intends to produce
a. market strategy
b. product strategy
c. tactical plan
d. marketing plan
4. The 'External Positive' that a company may exploit to its advantage
a. opportunities
b. weaknesses
c. strengths
d. threats
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5. The challenges posed to a company, which will have an impact to its operations and may limit the company in
the achievement of its objective
a. opportunities
b. weaknesses
c. strengths
d. threats
6. The stage where actual production of the product is done
a. product development
b. test marketing
c. business analysis
d. market strategy
7. Process of analyzing the general situation of a company
a. product development
b. test marketing
c. business analysis
d. market strategy
8. The stage in PLC where there is already improvement in sales due to consumers' acceptance of the product
a. introduction
b. growth
c. maturity
d. decline
9. The stage in PLC where sales and growth of the product stabilize
a. introduction
b. growth
c. maturity
d. decline
10. The stage in PLC where company decides whether to phase out the product, reintroduce, or sell the brand
a. introduction
b. growth
c. maturity
d. decline
11. Classification of industrial product that includes the building, land, and major equipment, like tractors, printing
machines, and generators
a. installations
b. raw materials
c. accessory equipment
d. supplies
12. Industrial products that become part of a finished product
a. parts and materials

b. raw materials
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c. accessory equipment
d. supplies and services
13. Word or words that represent a product
a. brand mark
b. brand name
c. product image
d. branding
14. A part of a product that contains the information about the product that the market needs to know
a. package
b. label
c. brand name
d. licensing
15. The part of a brand that can be easily recognized
a. branding
b. brand name
c. brand mark
d. brand differentia
EXERCISES
1. Which product life cycle stage is the most essential? Explain your answer.
2. Which product life cycle stage needs close monitoring? Why?
3. Differentiate a brand name from a brand mark.
4. Give some advantages of product packaging.
5. Compare and contrast consumer and industrial market.
1. Choose four product brands of the same category. Compare / contrast each brand in terms of packaging,
usage, image, features, quality, warranty, price, and accessibility.
a. What do you think is the distinct value offered by each brand?

b. Describe the market that would likely buy each brand.
2. How does product packaging affect consumers' decision of purchasing the product?
3. Enumerate reasons why some products' success rates are low. If you are the owner of a product, what are
the things that you would do to increase its success?
37
Tel/Fax No.: (047) 811-1683
College/Department College of Tourism and HospitalityManagement

Course Code ABM S3
MODULE 6
PRODUCT PRICING
INTRODUCTION
Price is the only "p" in the marketing mix that provides revenues to a firm. The rest—product, place, and
promotions generate expenses. The firm's decision to produce new products or enhance the existing products entails
expenditures. Choosing the right distribution channel for the product and transporting the products to reach the
distribution outlet, like supermarket and department stores incur expenses. In terms Of promotion, the choice of
broadcast programs or print media, whether to utilize sales promotions or public relations as mediums to reach target
market adds to the budget consideration of the company.

1. define price, its objectives and importance;

2. identify the major factors influencing price; and
3. recognize the different pricing strategies.
DISCUSSION
PRODUCT PRICING
- The pricing strategy that a company uses depends on whether its operation is in domestic market or
international market. Pricing schemes also vary depending on the type of products and the type of market
the company is catering to.
What is PRICE?
- Price refers to the amount of money charged by product or service providers to the market in exchange for
their products or services. In simple marketing exchange, the seller provides the goods that the market
needs, while the market in return provides payment.
38
PRICING OBJECTIVES
Companies set a particular price for a purpose. It can be that companies want to:
1. Meet their profit objective. Every company sets a specific profit target for a particular product at a
particular time. This profit objective or target becomes the motivating force for companies' marketing
efforts.
2. Maintain or improve market share. Right pricing scheme can enormously build customer traffic and an
important factor for brand shift decision of market.
3. Control entry of new players in the market offering competing brands. Companies do this by offering
lower prices and sometimes much lower than industry standard.
IMPORTANCE OF PRICE
1. Price dictates product demand. Market patronizes products because of their prices. Some factors must be
considered, like product quality and type of services given to customers by the company's staff.
2. Price determines the level of expenditures of the market. Price influences buyers' decision whether to buy
the product or not.
DIFFERENT PRICING STRATEGIES
1. Pricing in relation to product quality
a. Premium pricing strategy involves setting high price to products produced with high quality.
b. Economy pricing strategy involves setting the price low because the product is of low quality.
c. Companies that offer the same high-quality products but offer the customers with more value for their money
use the value pricing strategy.
d. In overcharging pricing strategy, products are high but the quality of the products is low.
2. Other pricing strategies
a. Penetration pricing strategy involves setting low initial price for new products offered in the market. The
objective of penetration pricing is to be able to enter the market immediately.
39
b. Market skimming pricing strategy involves setting high initial price for a product or services offered, and
after a definite period of time, companies either lower the price of the offering or maintain its price.
c. Bundle pricing strategy involves setting one price for a set or complimentary products. For example, spaghetti
pasta and spaghetti sauce are bundled and given a price of P 100. Some companies bundle fast-moving products
with products that are slow-moving. Services can also use bundle pricing strategy, like when resorts offer
packages that consist of accommodation, airfare, and meals.
d. Geographical pricing involves setting price differently in different locations. Producers of goods or channels
of distribution like wholesalers set geographical pricing scheme due to shipping cost or transport cost. Under
geographical pricing, seller offers varied schemes in different situations.
Some of these pricing schemes under geographical pricing are:
 Zoning Pricing. This is a type of geographical pricing where the seller sets up zones where markets within the
zone pay the same price for the products. The farther the distance of the market from the seller's zone, the
higher will be the product price. Some examples of zoning pricing are done by logistics providers, remittance,
and courier firms. Telephone companies also charge different long-distance call rates depending on location or
distance.
 Freight Absorption Pricing. In order to penetrate the market and to maintain existing customers, some sellers
shoulder part, if not, the entire cost of the freight. Freight absorption strategy is practiced by some companies in
the belief that distribution cost will be compensated by business done in volume.
REASONS FOR PRICE CHANGE
There are reasons why companies desire to increase or lower the prices of their products.
Companies cut price when:
1. There is excess capacity

2. There is continuous decrease in market share.
3. Competitors lower their price offering and other companies believe that it is advantageous to their
companies to follow the price decrease.
4. Company desires to regain lost market share and gain more customers.
5. Company is anticipating new product model or design.
On the other hand, companies increase price when:
1. There is a desire to increase profit.

2. There is high demand for the product.
3. There is increase in the cost of raw materials or labor cost.
40
ACTIVITY
1. The marketing mix that gives revenue to a company
a. product
b. promotion
c. price
d. place
2. Aside from customers, this entity reacts to a business enterprise's change of price
a. stockholders
b. competitors
c. publics
d. owner
3. One of the reasons why companies cut down prices
a. the desire to increase profit

b. the high demand for the product
c. the increase in the cost of raw materials or labor cost
d. the continuous decrease in market share
4. A pricing strategy that involves setting high price to product produced with high quality
a. value pricing strategy

b. premium pricing strategy
c. economy pricing strategy
d. overcharging pricing strategy
5. The pricing strategy that involves low quality product sold at low price

6. The strategy a company used when it offers high quality products at reduced price

7. The pricing strategy company uses when products are priced high but the quality of the products is low

41
8. Company reason in deciding to increase the price of a product
a. There is excess capacity.

b. There is continuous decrease in market share.
c. There is anticipation to new product model or design.
d. It desires to increase profit.
9. A strategy that involves setting one price for a set or with complementary products
a. penetration pricing
b. bundle pricing
c. market skimming
d. freight absorption
10. The strategy used by companies when they set a high initial price for a product or services offered and after a
definite period of time decides to lower or maintain the price of the offering
a. penetration pricing
b. bundle pricing
c. market skimming
d. freight absorption
EXERCISES
1. Give the importance of product pricing.
2. Give and explain three pricing strategies.
3. Explain the factors to consider when pricing a product.
1. In what situations would a company or a business give discount?
2. If you are an entrepreneur introducing a new product in the market, what pricing strategies are you going to
apply? Why?
42
Tel/Fax No.: (047) 811-1683

Course Code ABM S3
MODULE 7
PRODUCT DISTRIBUTION
INTRODUCTION
One of the important decisions that management faces is determining which marketing channel to use.
Product distribution is a critical factor in the efficient distribution of products from the manufacturer to the final
users of the products. The objective of any product distribution is to get the right quantity of goods at the right place
and right time with the least possible cost.
Physical distribution of products and logistics deals with the same activities. These consist of materials
handling, order processing, warehousing, transportation, and inventory. Logistics is concerned with materials
management and physical distribution. Physical distribution links manufacturing and customers, while material
management focuses on the link between the supplier and the manufacturing.

1. define product distribution;

2. differentiate wholesaling from retailing and identify their functions;
3. identify the distribution strategies used by companies; and
4. illustrate the levels of distribution.
DISCUSSION
DISTRIBUTION CHANNELS
Marketing intermediaries compose the distribution channel. They are people who serve as the link between the
firm or manufacturer and the market. Some examples of intermediaries are sales agent, advertising agencies,
wholesalers, and retailers. They perform tasks such as purchasing, storing, selling, and transporting products.
43
Wholesaling intermediaries are those that purchase products from manufacturers and sell these products to
retailers and other industrial users. Retailers, on the other hand, are those that purchase products and resell them to
final users or market for their own use. Retailing is the final stage in the channel of distribution.
Physical distribution of products starts when there is order from customers. How to handle such order in terms of
quantity, date of delivery, speed, price, and mode of transportation to use are the concerns of the distributors.
LEVELS OF CHANNEL DISTRIBUTION
1. Zero-level Channel. From the manufacturer, products reach the market directly. This is also known as
direct marketing. No marketing intermediaries or distributors are
2. One-level Channel. Before products reach the market, products pass through marketing intermediaries
either through the wholesalers or retailers.
3. Two-level Channel. This consists of two channels of distribution where products pass through before
reaching the end users. These channels are the wholesalers and retailers, respectively.
4. Three-level Channel. Products from the manufacturer pass through three middlemen or channels—the
manufacturer's selling agent, to wholesaler, and to retailer before the products reach the market.
DISTRIBUTION STRATEGY USED BY COMPANIES
1. Intensive Distribution. Firms place products in as many outlets as possible, be it in supermarkets,

department stores, convenience stores, hotels, and hospitals, among others. This makes the products
accessible and available to all consumers anytime, anywhere.
2. Selective Distribution. Products are distributed in a limited number of outlets. Companies develop close
business relationship with selected channels.
3. Exclusive Distribution. In this type of distribution, an outlet is given exclusive rights to carry the
manufacturer's products within a specific territory. This set-up is not convenient to the customers because
they have to go to that particular outlet where products are distributed or being sold. Although in exclusive
distribution, competition is less.
WHOLESALING AND RETAILING
Wholesaling involves transaction where products are sold for resale.

The person involved in wholesaling is called the wholesaler.
Other functions of wholesalers are:

1. They buy in large quantities and break these into smaller numbers for resale to retailers.
2. They provide product knowledge to the retailers as they promote and sell the products.
3. They provide the manufacturer the necessary feedback or market information about his product.
Retailing is the process of selling products to the end users. Retailing is the last stage in the channel of distribution.
Retailing is an important industry because:

1. It helps the economy by creating jobs or providing employment.
2. Majority of the market patronizes retail purchases.
3. It serves as links between the wholesalers' products and the customers.
4. It sells products that end users can afford.
44
5. Retail stores are commonly accessible to the market.
Classification of Retailers
a. Self-service is the type used by sellers in convenience stores.
b. Full-service stores offer more choices of specialty products providing more services to customers; thus,
operating expenses are high which result in higher product price.
c. Limited-service retailers carry more shopping goods; therefore, providing more sales assistance for
customers who need information about a product.
d. Personal-service retailers provide personalized service to consumers. Personal services and facilities given
to the customer build up goodwill and increase the volume of sales, as well as profit.
ACTIVITY
1. The distribution strategy of companies in which products are distributed in a limited number of outlets
a. intensive distribution
b. exclusive distribution
c. selective distribution
d. channel of distribution
2. The distribution strategy in which firms ensure that products are accessible and available to the market anytime,
anywhere
3. The distribution strategy in which an outlet is given exclusive rights to carry the manufacturer's products within
a specific territory
4. The last stage in the channel of distribution
a. wholesaling
b. retailing
c. market
d. delivery
5. The person involved in retailing
a. market
b. wholesaler
c. retailer
d. manufacturer
45
6. The stage in the channel of distribution that involves transaction where products are sold for resale
a. wholesaling
b. retailing
c. marketing
d. delivery
7. Distribution level manufacturers arrange for the products to reach its target market directly
a. zero-level channel
b. one level channel
c. two-level channel
d. three-level channel
8. People that serve as a link between the firm or manufacturer and the market
a. intermediaries
b. companies
c. customers
d. competitors
9. The retail service used by sellers of convenience stores
a. full-service retail
b. self-service retail
c. limited-service retail
d. personal-service retail
10. The wholesaler who does not take title to goods and brings together the buyer and the seller and assists in
negotiation
a. broker
b. agent
c. merchant wholesaler
d. intermediaries
EXERCISES
1. Discuss the current issues associated with physical distribution of products in the Philippines.
2. Compare and contrast wholesaling and retailing.
3. Can a company survive without intermediaries? Justify your answer.
1. Think of a business that you may put up in the future. What distribution strategy will you use to reach your
market? Justify.
2. Select a product from a different industry and analyze how the manufacturer of the product or the company
distributes its product (e.g., pharmaceutical company, company producing personal care products like
toothbrush, toothpaste, and facial care products).
46
3. Interview an entrepreneur that sells products in the food category, furniture, and appliance. Inquire about
the methods used by the entrepreneur to encourage purchase of his products by the market.
\Republic of the Philippines

Tel/Fax No.: (047) 811-1683

Course Code ABM S3
MODULE 8
PRODUCT PROMOTION
INTRODUCTION
Promotion, as one of the important "Ps" in marketing, involves communicating to the public something
about the product. The intention of communication is to inform, persuade, remind, and influence the decision of the
public about the product. Providing the customers with information is essential in developing long-term relationship
with them. There are different ways of product promotions like, advertising, public relations, sales promotions, and
personal selling. A company may use any one of these types, or a combination.

1. contrast the different promotional mediums;

2. illustrate the advantages and disadvantages of each mediums;
3. identify the different tools used in public relations and sales promotions;
4. explain the types of advertising; and
5. differentiate the promotions strategies.
DISCUSSION
PRODUCT PROMOTION
- An important marketing effort of any company, organization, or group is making the public aware of the
existence of a product or a service.
-
TYPES OF PRODUCT PROMOTION
1. ADVERTISING
Companies that wish to have advertising for product promotions a lot millions of pesos for advertising
budget. In advertising, firms pay for time and space in dealing with advertising materials.
47
What is ADVERTISING?
It is paid non-personal type of promotion where a product or idea is presented by an identified firm. It is
one of the widely used promotion. It is done using broadcast media. Basically, an advertisement or ad is shown in
mediums such as radio, television, or cinema. Another advertising medium is print where product promotions are
placed in journals, newspapers, magazines, and other publications.
Outdoor media is also famous medium for firms. Gigantic billboards are placed in strategic locations or in
busy highways to get the attention of motorists and passers-by. Moreover, transit advertising is a very much-
utilized medium in the form of ads set aside LRT or MRT, on top of a taxi, or logos designed or drawn on the body
of a bus or any public transport. Indeed, advertising stimulates demand for a product. Through these mediums,
potential market is reached and possible consumption of the advertised product by target market is achieved.
ADVERTISING MEDIUMS
A. BROADCAST MEDIA
A medium used by advertiser when they choose to have ad exposure on television, radio or cinema.
Advantage of Television Advertisement
 The advertising message can be repeated.

 The television ad can reach a wide range of audience.
 It is appealing to the viewer’s senses, combining the sight, sound and motion.
Disadvantage of Television Advertisement
 it is very expensive.
 Advertisers need to have several television ad placements in order for the product to be remembered by the
target audience.
 The advertised product has temporary or fleeting exposure.
B. PRINT MEDIA
Prices vary depending on the size of the ad, location, and the number of colors used in printing the
advertisement. Payment is based on column centimeter.
Advantages of Print Advertisement
 It can be read for a longer period.

 It is a lot cheaper than broadcast advertisement like the television ad.
 It can target specific readers or market.
Disadvantages of Print Advertisement
 It has a short time lifespan. A newspaper, for instance, is already a history the following day one published.
 Print reproduction may be poor quality.
 It has few or limited audience.
48
C. OUTDOOR ADVERTISEMENT
Consists of ads that are placed on highways or roads where there are many passers-by and vehicular traffic
is heavy.
Advantages of Outdoor Advertisement
 It is strategically located.
 It has high visual impact to people because of its size and aesthetic value.
 It is low in cost.
Disadvantages of Outdoor Advertisement
 It is more on visual, thus limiting creativity.

 It fights for motorist’s attention, other billboard ads due to its size and illustration.
 It may cause accidents on the roads especially during heavy rains/typhoon because of its huge size.
D. TRANSIT ADVERTISEMENT
A promotional ad placed inside or outside public transport.
2. PERSONAL SELLING
Unlike advertising, personal selling is a promotional method where face-to-face interaction between the
seller and the buyer is seen.
3. SALES PROMOTION
A kind of promotion the targets either the channel distribution, like the wholesalers or distributors, or the
market. This is a short-termed promotion that intends to make the market reacts fast to a promotion
campaign.
Sales Promotion Tools
A. Sales promotions that target consumers may use any of the following tools:
1. Bonus Packs
2. Cash Refund
3. Coupons
4. Free Items
5. Games or Contest
6. Price Discounts
7. Prizes
8. Product demonstration
9. Raffle
10. Sampling
11. Warranty
B. Promotions that target trade can use any of the following tools:
1. Allowance
2. Free Goods
3. Price Discounts
4. Price-offs
49
5. Raffle
6. Rebate
7. Sales Contest
4. PUBLIC RELATIONS
A type of promotion that builds good relations with the various stakeholders of the company by using
different public relations tools to establish good corporate image and manage unfavorable or negative
publicity or events.
Major Public Relations
a. New release
b. Press conference
c. Public service activities
d. Special events
e. Sponsorship
TYPES OF PROMOTIONAL STRATEGIES

1. Pull Strategy
A type of promotion where there is huge budget in advertising expenditure, public relations, or consumer
promotions to persuade the market to try the company’s offering.
2. Push Strategy
A type of promotion strategy that calls for using personal selling and trade promotions to aggressively
promote the company’s offering through various channel members, for them to carry the products and
promote to end users.
ACTIVITY
1. The type of promotion that builds good relations with the various publics of the company and manages
unfavorable or negative publicity or events
a. advertising
b. personal selling
c. sales promotions
d. public relations
2. The kind of promotion that targets the channels of distribution, like the wholesalers or distributors and the market
a. advertising
b. personal selling
c. sales promotions
d. public relations
3. The promotional method where face-to-face interaction between the seller and the buyer is seen
a. advertising
b. personal selling
c. sales promotions
d. public relations
50
4. Promotional ads that are normally placed on top of taxis, drawn on the body of buses, set inside light rail transits,
and other public utility vehicles
a. outdoor ad
b. transit ad
c. 'broadcast media
d. print ad
5. Promotional ads that are placed on highways or roads where there are many passersby and vehicular traffic is
heavy.
a. outdoor ad
b. transit ad
c. broadcast media
d. print ad
6. A paid non-personal type of promotion where a product or idea is presented by an identified firm
a. advertising
b. personal selling
c. sales promotions
d. public relations
7. A strategy that calls for using personal selling and trade promotions to aggressively promote a company's offering
through various channel members
a. push strategy
b. pull strategy
c. promotions strategy
d. marketing strategy
8. A promotion strategy where there is a huge spending on advertising, public relations, or consumer promotions to
persuade the market to take action in trying the company's offering
a. push strategy
b. pull strategy
c. promotions strategy
d. marketing strategy
9. A short-term promotion that intends to make the market react fast to a promotion campaign
a. advertising
b. personal selling
c. sales promotions
d. public relations
10. Type of promotions that includes coupon, sampling, product demo, warranty, and price discount
a. advertising
b. personal selling
c. sales promotions
d. public relations
51
EXERCISES
1. Can a business enterprise survive without promotions? Explain your answer.
2. How does personal selling differ from sales promotions?
3. Which among the different types of promotion do you think is effective? Why?
1. Select a hotel or a restaurant that you are well familiar with. State the reasons why this hotel or restaurant
caught your attention to try their services.
2. Choose two (2) brands of fresh milk available in the supermarket.
a. Indicate all the types of media the business uses to promote its offering.
b. Suggest ways how can the company improve the brand to generate purchase action from the market.
52
Tel/Fax No.: (047) 811-1683

Course Code ABM S3
MODULE 9
CAREERS IN MARKETING
INTRODUCTION
Thinking what career to enter in the dynamic field of marketing is not easy. One has to consider a lot of
preparations starting from accomplishing self-evaluation to fully assess one's skills, interests, strengths, and
weaknesses to the task of preparing the resume which summarizes all the accomplishments of the person.

At the end of this module, the student are expected to:
1. identify which career opportunity in marketing he/she is likely to enter;

2. illustrate the different career track in marketing; and
3. summarize the preparations needed in searching for a career.
DISCUSSION
CAREER IN MARKETING
The field of marketing is dynamic and vast where anyone interested to be part of it can enter the field through
the following positions:
 PRODUCT MANAGEMENT
- The task of planning, organizing, supervising, or controlling products that a company produces is the
concentration of product management.
Product Manager
 In charge of managing a specific brand or product line.
 Responsible in terms of:
 Product planning and development
 Coordinating with various channel distributors
 Product pricing and promotions
53
 Some companies call this position as Brand Manager
- Companies with different product lines have several product managers or brand managers.
Product Specialist
 Responsible for monitoring the quality and stability of firm’s product.
 A product specialist collaborates with product managers in shaping and executing product goals.
- Other marketing works fall under product management team or those that assist product managers or
brand managers in the performance of their tasks.
 SALES MANAGEMENT
- The fields of sales management is broad for it involves managerial functions like recruitment and
selection, as well as training of salespersons, monitoring, promoting people, and even terminating
them. There are also a lot of sales positions under this section such as sales manager, regional sales
manager, or national sales manager, and other sales management positions that are available to assist
the sales management team in doing their tasks.
 PERSONAL SELLING
- This is the most common entry-level position in the field of marketing. The position can be very
challenging to those who look as sales as a career. It is a job that can be very demanding as well.
 PROMOTION MANAGEMENT
This is the field where vital role of informing the public of the company’s product offering and persuading
the market to try its offering.
Advertising
 One of the areas that offer various positions like advertising manager or promotions manager. Under
advertising department, one can also seek positions in account management, which is responsible in
handling clients or advertisers and closely working with them in planning, promoting and choosing the best
promotions medium for a certain product.
 Other advertising positions include account manager, media buyer and media planning, account
director, media director, and account executives, among others.
Account Manager
 Involves a close coordination with the client and with the other members of advertising team like the creative
team. An account manager may have several clients or companies known as accounts under his supervision.
Direction of Account
 Handles the coordination of all works of all the account managers under his team. Part of the job is to ensure
that the advertising agency’s clients or the company’s clients are satisfied with the kind of services given to
them by the account managers. Thus, the director of accounts should have the skills to match the needs of a
specific client with the competency of an account manager.
Media Planner or Buyer
 Is in charge of choosing the right media for advertising materials. He or she also establishes media linkages.
This position is responsible for taking good care of the clients’ promotional budget by proper media scheduling,
which includes print and broadcast media, like radio and television.
5. DISTRIBUTION OR LOGISTIC MANAGEMENT
54
- There are different position under distribution and logistics management such as merchandising manager,
department manager, department purchaser, store managers, and merchandise managers.
- There are several distribution channels that make any product or services reach the final users from the
manufacturers. Retailing belong to this distribution channels. Retailing deals with merchandise purchase and selling.
Big supermarkets are examples of business enterprise that belong to the retail industry.
Department Manager
 Responsible for the operation of the entire department planning, staffing, work scheduling, monitoring of
employees within the department, to supervision of merchandise.
Department Purchaser
 Deals with the merchandise suppliers. He negotiates terms of pricing. The purchaser also known as the buyer
who decides on merchandise assortment of the store. The store purchaser or buyer also decides the seasonal
sales events of the store or enterprise.
Store Managers
 He is responsible for the smooth flow of store operations. He makes sure that there are enough supplies of all
merchandise on the display shelves. He monitors the staff inside the store. He also ensures the good relationship
of the entire store personnel with the clients.
6. MARKETING RESEARCHERS
The researcher’s job is to provide adequate and accurate information to management for them to come up
with the better decisions for the good of the company and its market.
Marketing Manager
 He is responsible for developing and strategies, overseeing the operations of entire marketing activities of the
company, and providing much needed feedback to top management so that better can be made.
ACTIVITY
Gap-Fill. Match the descriptions in Column A with the corresponding terms in Column B. Write the letter of the
correct answer on the blank provided on Column A.
Column A Column B
____ 1. monitors the quality and stability of the product a. account manager
____ 2. in charge of managing a specific product brand or product line b. department manager
____ 3. a job that can be very rewarding yet very demanding as well c. media planner
____ 4. closely coordinates with clients about product promotions d. media relations manager
____ 5. in charge of choosing the right media for advertising materials e. personal selling
____ 6. responsible for the entire operations of a department
____ 7. deals with merchandise suppliers and decides on store's f. product manager
merchandise. g. product specialist
____ 8. responsible for the smooth flow of store operations h. purchaser
____ 9. a job position that provides valuable and accurate information to i. researcher
top management j. store manager
____ 10. convinces reporters to write about a story relating to a client
55
EXERCISES
1. With the wide opportunities in the field of marketing, what marketing career interests you? Why?
2. What makes a successful marketer? Justify your answer.
Mini Case
Peter submitted his curriculum vitae at ABC Advertising as part of the on-the-job requirement of the
advertising agency. He was accepted and he was expected to render I 280 OJT hours. He was assigned to be part of
the Account Management group. His job includes preparing materials needed for product presentation and sales
pitch of the Account Management team. He was always asked to go with the team whenever they meet clients,
usually by companies, to do campaign presentation.
Peter becomes excited every time a client approves the group's creative works. Eventually, Peter wants a
career as Account Manager. He learns that the position involves more than creating campaign presentation and
closely coordinating with the creative, as well as the media department.
1. Assess the position of an Account Manager. Identify the skills that Peter needs to develop in order to
succeed in this position.
2. Assume that you are going to make a campaign presentation to one of your agency's potential clients. State
the reasons why the client should hire your company as its advertising agency.
ASSESSMENT
Quizzes, Major Exams, On-line discussions, assignments, case analysis, oral/written reports
SUGGESTED READINGS
Go, Josiah and Chiqui Escareal-Go. 2010. Fundamentals of Marketing in the Philippine Setting 2nd Edition. Josiah
and Carolina Go Foundation, Inc.
Keegan, Warren J. and Mark C. Green. 2003. Global Marketing 3rd Edition. Pearson Education, Inc.
Kotler, Philip and Gary Armstrong. 2001. Principles of Marketing 9th Edition. Prentice Hall, Inc.
Kotler, et al. 2009. Principles of Marketing: A Global Perspective. Singapore: Pearson Education South Asia Pte
Ltd.
Pagoso, Cristobal and Manuel Dela Cruz. 2000. Principles of Marketing in the Philippine Setting. Manila: Nelson
Publication.
Pride, William and O.C. Ferell. 2009. Foundations of Marketing 3rd Edition. Houghton Mifflin Co. Boston, New
York.
RESOURCE AND ADDITIONAL RESOURCES

Balasan, M., 2014. Marketing Basics: A Modular Approach. 1st ed. 856 Nicanor Reyes Sr. St., Sampaloc Manila:
Rex Book Store, Inc.
Prepared by:
GRACE P. GIRON, MBA, LPT

Instructor
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`Republic of the Philippines

President Ramon Magsaysay State University

MODULE 2: THE ENVIRONMENT OF BUSINESS

MODULE 3: MARKET SEGMENTATION

MODULE 4: CONSUMER BUYING BEHAVIOR

MODULE 5: UNDERSTANDING PRODUCT

MODULE 6: PRODUCT PRICING

MODULE 7: PRODUCT DISTRIBUTION

College/Department College of Tourism and Hospitality Management

INTENDED LEARNING OUTCOMES

1. the meaning of marketing;

THE BASIC CONCEPTS OF MARKETING

HIERARCHY OF NEEDS BY MASLOW

PLANNING THE BUSINESS ENTERPRISE

IMPORTANCE OF BUSINESS PLANNING

Through planning, one can:

 apply for loans;

 determine the needed capital;

 lessen impact of business failure;

 lessen risk of doing business;

 minimize or eliminate losing capital because everything is well thought of;

 result in better preparedness for sudden development;

 lead to better coordination among different departments in the company; and

 program activities in advance.

 It helps develop more and better products,

 It provides better profit.

 It improves the quality of life,

 It produces more entrepreneurs.

 It contributes to economic development.

What Is STRATEGIC PLANNING?

STRATEGIC PLANNING AND MARKETING PLAN

PARTS OF MARKETING PLAN

PROCESS OF STRATEGIC PLANNING

 Drafting the Company’s Mission

SETTING OF COMPANY’S OBJECTIVES

Examples of a company’s objectives are:

a. to build profitable customers relationship;

DESIGNING THE COMPANY’S BUSINESS PORTFOLIO

 Build it Share. More investment is needed by companies to achieve this.

Growth-Share Matrix or the Boston Consulting Group (BCG) Matrix

PRODUCT/MARKET EXPANSION STRATEGIES

 Coordinating Activities to Different Functional Areas

2. Demand is the result of need and wants plus __________________.

5. ______________________ refers to a statement of an organization or company's purpose or reason of

6. ______________________ refers to the choice or preferred products of an individual as influenced by

9. _______________________ provides the highlights of the marketing plan.

12. _______________________ refers to low-growth, high-market share business or product of a company.

13. ____________________ are SBUs with low-market share in high-growth market.

____ 2. A marketing philosophy where firms hire marketers to do aggressive marketing.

____ 4. It consists of people who purchase products to produce another product.

1. Why is it important for a company to have a written plan?

2. What is the role of marketing in strategic planning?

3. Differentiate the marketing management philosophies.

4. What important roles does marketing play in our economy?

4. In which particular areas must the two convenience stores be improved?

Republic of the Philippines

College/Department College of Tourism and Hospitality Managment

INTENDED LEARNING OUTCOMES

1. identify the various internal business environments;

The micro-environment is composed of:

___1. Environment where individuals have the power to control

___ 2. Consists of new machinery, equipment

___ 3. Refers to inflation, employment rate, prices