PRINCIPLES OF MARKETING

WEEK1 : Marketing Mix -The Product

The success of an organization lies on the skills of marketers in selecting the right marketing mix. The product should
answer the needs, wants and expectation of the customers. It should be priced reasonably and be distributed to the
right place. All of these should be properly communicated to targeted customers.

According to Philip Kotler, a product is anything tangible or intangible that can be offered to a market for attention,
acquisition use or consumption that might satisfy a need or want. According to Kotler and Armstrong, service refers to
activities, benefits or gratification offered for sale that is essentially intangible and does not results in the ownership of
anything.

Generally, a PRODUCT is a PRODUCT and SERVICES.

A PRODUCT- IS TANGIBLE (e.g. goods, materials, merchandise, like shampoo laptop, computer, clothes, tables ect.)

A SERVICE- is INTANGIBLE, benefits and gratification you get from SPA, MANICURE, HAIRCUT, MASSAGE PARLOR,
REPAIR SHOP and more.

EXPERIENCES -of customers with brands should be considered as important value delivering services.

Many customers patronized products and services because of the excellent experience with the brand's services. For
instance, a customer regularly shops at a department store that he of she thinks to provide the most pleasurable
shopping experience, considering that there are many department stores existing in the market that offers the same
array of brands.

CLASSIFICATION OF PRODUCTS and SERVICES:

1. Consumer Products any products that are purchased by customers for their -consumption.

2. Industrial Products - any products that are purchased by individuals or institutions for the purpose of implementing
the business.

TYPES OF CONSUMER PRODUCTS

1. Convenience products Products or services that consumers buy regularly or usually. Examples: shampoo, soap,
Colgate, joy liquid etc.

2. Shopping products Products or services that consumers buy infrequently. Examples: laptop, cellphones, dress,
computers Products or services that have unique attributes and brand recognition for

3. Specialty products which consumers are ready to exert special effort. Examples: a limited car edition that only
available in a certain country. Thus, for the buyer to purchase the special type of car, the buyers have to go the
particular country where the car is being sold.

4. Unsought products Products or services that consumers are either not aware of the brand existence or have
awareness of the brand, however not usually consider buying it. Examples: funeral services and insurances policies.

TYPES OF INDUSTRIAL PRODUCTS

1. Materials and parts - raw materials or manufactured materials and parts. Example: cotton, paper, oil, iron, tires.

2. Capital items - products that help the companies in operation and production, Installation and accessory equipment.
Example: generators, manufacturing plant, lift trucks, computer

3. Supplies and services - products that includes operating supplies, repair and maintenance. Example: coal, paint,
computer repair.
 Developing Products and Services

Marketers should always consider the attributes and benefits that a consumer can get or experience from a product.
1. Design and Style

Design-determine the usefulness and add value to the product.

Style-physical appearance may catch or drop the attention of the buyer.

2. Quality -major considerations of marketers in positioning a product.

Quality has a direct relationship with product performance. It is considered determinants of customer value and
satisfaction.

Quality is beyond producing defect-free. Quality should be able to satisfy the consumer's needs.

3. Features Established product distinction. Help company attain competitive advancement.

Companies introduced valued new features to create market superiority.

ESTABLISHING PRODUCTS and SERVICES

Marketers should think of the following products strategies:

1. BRANDING

It refers to the name, term, signs, symbols, design or combinations of these, which serve as identification of the
products, services or institution that separate them their competitors.

2. PACKAGING

It pertains to the process of designing and producing container or wrapper for products.

Its primary purpose is to secure the condition of the product.

Attract the attention of the customers

Help describe the product

Good packaging promotes strong recognition of the product

3. LABELING

Simple tags to intricate graphs, creates identity to the brand,

Tells about the products, content, dimension, usage.

Helps brands achieved positioning and help add personality to the product.

4. PRODUCT SUPPORT SERVICE

This is essential in building healthy relationship with customers. Marketer does not stop by making sales, it is
important to ensure ultimate customer's experience by maintaining customer' happiness even after sales.

This may include comment drop boxes for customers feedback, active email for complaints, customer service counter
and many more.

Learning Competency Define a product and differentiates the product, services and experiences. (ABM PM11-lla-e-16)

WEEK 2-3: MARKETING MIX-The Price, Place & Promotion

The PRICE is one variable in the marketing mix and a key factor and a major determinant of customer buying decision.
Providing consumers with products at right prices is one of the trade secrets of many companies in having profitable
sales.

"Price is the amount of money charged for a product or service."

Factors that should be considered in pricing decision.

Cost -is a major determinant in setting the price:

Consider all the costs of the company in producing and delivering the product in the market

The perceived value of the customers is also important in pricing the product.

Competition is also an object in setting price.

Cost Based Pricing- an approach or strategy in pricing that utilizes production cost as its basis for determining the price
to products.

a. Cost plus pricing-mark up is added to the product cost

b. Break-even pricing-companies set the price to break-even on the cost on the cost of making and marketing
products or to reach the target profit.

Value-based pricing-setting the price of the products based on the perceive value. This pricing approach utilizes the
perception of the consumers on the value of the product instead of the seller's cost in determining the price.

PRICING STRATEGIES

1. Product Line Pricing

Many companies develop products lines instead of single products. In this strategy, the company should decide on the
step to set the products in a line. The price step should be considered the cost difference between the products in the
line, customer evaluation of their features and the price of the competitors.

2. Optional-Product pricing

This strategy works by offering to sell optional accessory product along with the main product

3. Captive-Product Pricing

This strategy works by setting a price for products that should be used along with the main idea product. For example,
the razor is the main product, and the razon blade is the captive product. Companies price the main product low
because they make money on the captive price.

4. By-Product Pricing

This strategy works by setting a price for by-products to make the main product's price more competitive. For
example, a clothing company may decide to sell their fabric scrap or "retaso" to rag makers. The earning in the sale of
fabric used for producing the main product. This will allow the company to sell the main product in lower price

5. Product Bundle Pricing

The companies using this pricing strategy often combine several products of their products and sell the bundle at a
reduced price.
Marketing Mix Place / Distribution Channel

Marketing experts agree that one key determinant of a good marketing of products and services are making them
accessible and available at the right place. Thus, paying too little attention to distribution channels in marketing is not
wise

Distribution channel or marketing channel is a group of interdependent organizations that participate in the process
of making products or services available for the consumption of the buyer or user.

Channel level refers to the layer of middlemen working to deliver the products and its ownership nearer to the final
buyer.

Retailing-refers to the activities involved in a selling goods or services directly to final consumers for their personal,
business use.

A retailer-any business enterprise whose sales come primarily from retailing Wholesaler a person or company that
sells goods in large quantities at low prices, typically to retailers.

Middlemen-an intermediary or agent between two parties especially a dealer, agent, or company intermediate
between the producer of goods and the retailer or consumer.

Functions of Distribution Channel

1. Provides Information middlemen provide information on the market to the manufacturer.

2. Maintain Price Stability - middlemen maintain the old price of the product even though the manufacturer has
increased the price of the product. This is due to stiff competition in the market. To do this the middlemen keep the
overhead cost low

. 3. Boosts Promotion - middlemen design promotion for products they carry in their territory, they even finance the
promotional activities to build and keep healthy relationship with their customers.

4. Finances Manufacturers' Operation middlemen fund the operation of the manufacturer through advance payment
for goods and services that can be used as working capital

5. Matches Buyers and sellers-middlemen match the needs of buyers and sellers. Some seller has no idea where to
reach potential buyer of their product and same with the buyers, they do not know where to reach potential seller of
the products they need.

Integrated Supply Chain Management (SCM)

ISCM is a concept in marketing should needs to be appreciated. This is consisting of a network of

SUPPLIERS

MANUFACTURERS

WAREHOUSES

DISTRIBUTION CENTERS

RETAILERS

Chain management is the course of managing the flow of goods and services, which includes transportation and
storage of production materials, manufacturing, and inventory and movement of finished goods from manufacturer to
end users.
 Marketing Mix-PROMOTION

Maximizing the power of Integrated Marketing Communication (IMC)

Marketing- does not focus alone in planning what product to produce, making it affordable and placing it on the
market accessible to prospective buyers. Companies must take into consideration the importance of promotion as
away to communicate the products to customers, making them aware of the product's existence and persuading them
to buy and try the products.

THE PROMOTIONAL MIX

Advertising- is a nonpersonal, paid promotional tool to promote ideas, goods, or services. This tool would include
billboards and magazine advertisements.

Sales promotion- are incentives to stimulate purchasing Consumers are stimulated to buy items in order gain more
property pieces for a chance to win a prize.

Public relation- is a tool for the company to create a favorable image for them, their products and services, and as well
as their operations. The company created promotion for the drink, offering to donate to educational opportunities for
youth for every drink they sold (Starbucks Corporation, 2014). This promotion not only helps the youth, it helps add a
positive image for the company.

Personal selling -is one to one selling from the worker to the potential buyer. This a the most expensive forms of
promotion but creates a direct contact to the buyer An example of this promotional tool is telemarketing A worker
calls a potential buyer and explains the offerings of the product personally.

Direct Selling- is advertising directly to a specific audience rather than a mass audience This allows companies to
engage in a one way conversation with potential buyers and create lasting relationships. An example of direct
marketing is sending promotions through the ma to their consumers or potential buyers.

Advertising Objectives:

1 To Inform-use informative advertising, to introduce a new product or features and to establish major demand.

2. To persuade-influencing the customers to buy the product because it offers the best quality at affordable prices.

3. To compare-use comparative advertisements by comparing their brand to other competing brands in the market.

4. To remind - advertising use to remind the consumers that their products still exist thus continue patronizing the
product.
INTEGRATED MARKETING COMMUNICATION (IMC) is the integration of all promotional tools to promote a particular
product or services harmoniously among target consumers.

IMC helps marketers in designing a plan that carefully integrates all communication channels that would deliver clear,
powerful and cohesive marketing message about the products.

IMC can produce communication campaigns that would increase brand awareness and establish brand recall Through
IMC can penetrate customer's mind which are so powerful that can influence buyer's attitude and patronize the
product.
IMC provides the companies with a competitive advantage in the market

Two (2) Basic Strategies Promotional Mix

Push Strategy- Companies may use sales force and trade promotion in pushing the product through different channels.

Pull Strategy- Marketers relies on the advertising and consumer promotion to create consumer demand. The success
of this strategy will let the consumers demand the product to the retailers.

Public Relations- Companies focus on public relation to establish and maintain good relationship with the public

The goal of public relation is to win the public trust by implementing public programs that promote goodwill.

Public Relations Tools

1. News - publicize company's events, community development programs, product launching News can be in form of
press release.

2. Press Conference or press briefing-companies conduct press conference can be considered as public interest,
announced publicly like new product launching, product development

3. Special events -community outreach programs, exhibits, sports clinic, for effectively reaching the target publics.

4. Written materials-sometimes called literature, annual reports, brochures, comics, newspapers, help the company
to communicate effectively to the public.

5. Corporate identity materials-logos, stationary, any uniforms are just a few of the corporate identity materials that
can be used in image building.

Personal Selling

Personal selling- is very important part of promotion mix. It is the eldest media of sales promotion. Although being
old, this is the most popular media for sales promotion Qualities and Features of personal Selling.

1. Persuasion -In personal selling the prospective customers are reassured

2. Personal communication- Personal interactions may take place between customers and seller. Talks may also be
held through telephone, fax, e-mail, Internet etc. Such exchange of information is called personal selling

3. Selling process- Indoor seller should complete the process such as drawing attention of the customers, politely
welcoming inquiring, presenting goods, solving customers doubts, help them in selecting goods, giving chances for
selection, selling additional goods and seeing off with respect.

Outdoor seller- should complete the process such as prospecting making pre approach and approach display of
product meeting objectives, close the sale and follow up about the goods or services

The significance and objectives of personal selling are as follows:

1. Awareness of need. Personal sellers reach target markets for selling goods

2. Solution of the problem Seller reaches targeted markets, gives information to the prospective customers about the
goods or services intended to sell. If necessary, product is also presented among them. After the presentation, the
customers may raise problems about the goods.

3. Persuading the customers- the possible customers should be converted to real customers from such information.
So, personal selling aims to reassure all the customers about the product.

4. Two-way communication The seller keeps direct contact with the customers of target market. In this way, the
sellers and buyers may meet and have talks.

Types of Personal Selling

Personal selling- is very effective sale function. It does not only make two-way communication about goods or services
but also educates the customers
 1. Indoor personal selling- The seller who sells goods or services living at certain place is called indoor seller .2.
Outdoor personal selling- Identifying customers and by walking in different geographical regions and selling goods to
them is called outdoor personal selling .

3, Sales representative- Big business forms or companies appoint their sales representatives to sell their products.

Learning Competencies:

Identify and describe the factors pricing and its general approaches.

Discuss the structure of distribution channels, its functions, and the nature of supply chain management.

(ABM PM-la-e-17)

Define and identify relevant promotional tools, sales promotion, personal selling public relations and indirect
marketing to buy the product or patronize the service.

(ABM PM-11-la-18)

(ABM PM-11-la-419)

WEEK 4: Marketing Plan, Implementation, and Control

Background Information

In any kind of business, marketing plan is very important tool to serve as a standard against which the firm's progress
can be measured and evaluated, and it helps the company to set specific path in marketing. The marketing plan helps
to identify a company's position and potential for it sets the foundation for a business, organization and marketing
strategy. Without a thorough study of marketing plan, a company may not understand how current conditions may
affect profitability. These conditions can be any internal or external factor influencing future investments. Dimensions
of this may include environmental issues, competitive positioning, target audience behaviors and any related factor
influencing the success of the organization.

Marketing plan serves-it-purpose when properly implemented or put into action. A marketer needs to be fully aware
of the current scenario, dynamism, and future predictions With constant monitoring and control to measure standard
versus actual results, to find out the any variances and make necessary action for improvement, and for the
attainment of company's goals and objectives.

Marketing Plan

- is a comprehensive document or blueprint that outlines the advertising and marketing efforts for the coming year.

- It describes business activities involved in accomplishing specific marketing objectives within a set time frame, It
includes a description of the current marketing position of a business, a discussion of the target market and a
description of the marketing mix that a business will use to achieve their marketing goals.

The marketing plan is needed for a variety of reasons:

To obtain financing, to provide direction for the firm's overall business and marketing strategies, to support the
development of long- and short-term organizational objectives.

To discuss the administrative side of marketing (see Exhibit 1) it starts with situation analysis, then designing the
marketing strategy, towards the development of marketing programs and finally the implementation and managing of
marketing strategy.

Marketing Strategy implementation

Marketing strategy implementation- is the process of turning plans into actions Strategic Marketing implementation
effectiveness largely depends on (1) the level of involvement of executive leadership in the implementation of
marketing tasks, (2) coordination to ensure harmonious cooperation, (3) communication - vertical and horizontal
information flows, (4) human resources, (5) organizational resources- IT systems, buildings, management methods, (6)
motivating the creation of incentive climate in which staff undertake actions to achieve the purpose of the company,
(7) organizational structure relations between organizational units, processes, and formalization and (8) organizational
culture - market focus, values, customer orientation of personnel.

Marketing Control -This refers to the measurement of the company's marketing performance in terms of the sales
revenue generated, market share captured, and profit earned. Here, the actual result is compared with the standard
set, to find out the deviation and make rectifications accordingly It simply means enhancement of efficiency, by
reducing the chances of errors and meeting the standards set by the management.

Marketing Control Process Marketing control is a systematic and integrated process A marketer follows the following
steps while exercising control over the marketing operation in an organization:

1. Determining Marketing Objectives: The initial step in marketing control is the setting up of the marketing goals,
which are in alignment with the organizational objectives.

2. Establishing Performance Standards: To streamline the marketing process, benchmarking is essential. Therefore,
performance standards are set for carrying out marketing operations.

3. Comparing Results with Standard Performance: The actual marketing performance is compared and matched with
the set standards and variation is measured.

4. Analyzing the Deviations: This difference is then examined to find out the areas which require correction, and if the
deviation exceeds the decided range, it should be informed to the top management.

5. Rectification and Improvement: After studying the problem area responsible for low performance, necessary steps
should be taken to fill in the gap between the actual and expected returns.

Annual Plan Control

The plans which are determined for one year for the control of operational activities through the successful
implementation of management by objectives is termed as annual plan control. It is usually framed and controlled by
the top management of the organization.

Following are the five vital tools used under the annual plan control mechanism:

Sales Analysis. The first one is the sales analysis, where the manager determines whether the sales target of the
organization have been achieved or not. For this purpose, the actual sales are compared with the desired sales and
deviation is computed. This method is also used for finding out the efficiency of sales personnel by comparing the
individual sales with the target set for each salesperson

Market Share Analysis. To evaluate the competitiveness, the management needs to find out the market share acquired
by the organization.

Marketing Expense to Sales Analysis. Sometimes the firms spend much on the marketing of products, which
diminishes their profit margin or increases the product price. Therefore, a marketing expense to sales ratio is
calculated to know the percentage of sales value paid off as a marketing expense.

Financial Analysis. The management needs to handle its finances well. It should examine the reasons and factors which
influence the rate of return and financial leverage and return on assets in the organization through financial analysis
tools.

Customer Attitude Tracking. Consumer satisfaction has been considered as an essential parameter to analyze the
organization's performance. It is a qualitative analysis tool which can be of the following three types:

1. Customer Surveys: The companies get the questionnaires filled or make calls to the past customers for finding out
the level of consumer satisfaction, it provides a direction to the sales team and the management.

2. Customer Panels. The organizations form consumer panels where the customers are hired to review the products,
advertisements and other marketing activities. It helps the management to know about the consumer's perception
and attitude.

3. Feedback and Suggestion Systems: Market performance of the products can be analyzed with the help of genuine
feedback from the customers, and the same can be improved through their suggestions and input.

Profitability Control Maximizing the profit margin has become a difficult task in today's highly competitive market.
Following is the process of profitability control in an organization:
The first step is to understand the functional expenses, i.e., selling, distribution, administrative and advertising
expenses incurred while carrying out the marketing function of a territory or marketing channel. The second step is to
segregate the non-marketing expenses from the marketing overheads and then to associate these pure marketing
expenses to the marketing entities (like apportioning the building rent into marketing function) Lastly, to compile
everything systematically and to ascertain the profit or loss incurred on carrying out the particular marketing activity,
an individual profit and loss account is prepared for each operation.

Efficiency Control- The management and the marketers are regularly involved in finding out ways to improve the task
performance in the organization. These improvements bring in efficiency and perfection in marketing operations.

The three essential mechanisms used under efficiency control are as follows:

Sales Force Efficiency Indicators. The competence of the sales team can be determined by evaluating the various
factors. It includes acquisition of new customers, customer turnover, average cost incurred on each sales call, return
on time invested on the prospective customers, market share lost to the competitors, average sales made by each
person per day, etc.

Advertising Efficiency Indicators. To know the effectiveness of the advertising activities, the marketers analyze the
various advertising functions on different grounds. For this purpose, it finds out the brand awareness, cost incurred on
each enquiry, media cost to reach per thousand customers, advertising campaign reach, etc.

Distribution Efficiency. The performance of the distribution channels in comparison to the cost incurred on channel
partners and distribution of products can be analyzed through the distribution efficiency control.

Strategic Control The external environment creates a significant impact on the organization's marketing strategies. To
understand and align the plans with the prevailing external environment, the organization can adopt any of the
following control functions:

Customer Relationship Barometer. To determine the customer's loyalty towards the brand and s products, the
organization uses the relationship barometer.

Marketing Audit. It is a systematic record which periodically examines the problem areas and provides for the means
of rectification, to overcome the weakness by utilizing the organizational strength

II. LEARNING COMPETENCY WITH CODE

learner will be able to understand the necessity of marketing plan in business and be able to explain the relationship
of marketing plan, implementation and control The The relationship of marketing plan, implementation and control
(ABM_PM11-111-20)