Entrepreneurshi

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Week 7
Lesson: Marketing Mix
 Review:
Questions:
1. What is viability?
2. What is profitability?
3. What is customer requirements?
4. What is Product Life Cycle?
5. What are the phases or stages of Product Life Cycle?
Game Na!!!
1. PRODUCT
2. PRICE
3. PLACE
4. PROMOTION
 Marketing Mix:
The 7P’s of Marketing
 MARKETING MIX
It is a widely accepted strategic
marketing tool that combines the
original 4Ps (product, place, price,
promotion) with the additional 3Ps –
people, packaging, and process- in
formulating marketing tactics for a
product or service.
 4P’s – (Product, Place, Price,
Promotion)
- were used in marketing products
and physical goods only.
3P’s – (People, Packaging and
Product)
- It is also applicable in
marketing products.
 Product
-Is any physical good, service or
idea that is created by the
entrepreneur or an innovator in
serving the needs of the customers
and addressing their existing
problems .
 PRODUCT
The tangible commodity or the intangible service that the business firm
offers for sale to prospective customers. It also includes the warranties and
other conditions attached to the product.
1. What product or service is the most appropriate for the opportunity?
2. Why will customers buy or avail the product?
3. What is unique about the product/service?
 Three -level Concept of
1.
Product
Core Benefits of the Product or
Services
2. Physical Characteristics of the
Product or Services
3. Augmented Benefits of the
Product or Services
 Three -level Concept of
1. Core BenefitsProduct
of the Product or Services
- Major factors why a customers buys a product or
avails of a service.
Example:
A customers buys coffee because he or she
wants to feel energetic and alert at the whole day.
 Three -level Concept of
2. Physical Characteristics
Product of the Product or
Services
- The second layer of selection. Which has a better
packaging for products or a better physical
evidence or customer experience for services.
Example:
A customers can choose coffee with a more
appealing packaging or a more aromatic smell.
 Three -level Concept of
3. Augmented Benefits
Product of the Product or
Services
- Augmented benefits is an additional benefits.
Example:
the customer can choose a coffee product that
comes with a LOYALTY CARD, so that when he or
she accumulates, say 10 coffee drinks , he or she
will be able to get a free coffee drink.
 Price
-is the peso value that
entrepreneur assigns to a certain
product or services after
considering its costs, competition ,
objectives , positioning and target
market.
 PRICE
The amount of money paid by the customer to the selling business firm so the customer can use
the product. The transaction could mean either absolute transfer of ownership from seller to
buyer or a rent or lease arrangement. The price is set to attract prospective customer to buy.
Pricing Strategies
1.Bundling
2.Penetration pricing
3.Skimming
4.Psychological pricing
5.Cost-based pricing
4
Pricing Strategies
1. Bundling – This refers to two or more
products or services in one reduced
price.
Example :
3 in 1 coffee for P8.00
Manicure and pedicure for P150.00
 Pricing Strategies
2. Penetration Pricing – refers to setting low
4
prices to increase market share, but the
entrepreneur will eventually increase the
price once the desired market share is
achieved.
Example :
Mobile app- based transportation service offering
reduced booking fee of P15.00 as its introductory price.
Online websites offering 1 month free for a
subscription – based service.
 Pricing Strategies
3. Skimming – This is the opposite of
penetration pricing where prices are
initially high and then they are lowered to
offer the product or service to a wider.
Example :
A real estate company offering top-tier
projects is now offering low-cost housing of
same quality to serve the middle segment.
 Pricing Strategies
4. Competitive Pricing – refers to
benchmarking pricing with the
competitors.
Example :
Milktea prices are competitively priced.
 Pricing Strategies
5. Product Line Pricing– refers to different
products or services within a parallel
product array using varying price points.
Example :
LED TV is more expensive than the LCD TV
even if under the same brand.
 Pricing Strategies
6. Psychological Pricing– considers the
psychology and positioning of price in the
market.
Example :
99, 199, 299 price of the product
 Pricing Strategies
7. Premium Pricing– refers to setting a
very high price to reflect elitism and
superiority.
Example :
Prices of signature clothes, bags and
perfumes
 Pricing Strategies
8. Optional Pricing – refers to adding an
extra product or services on top of the
original to generate more revenue.
Example :
Meals on top of the air fare.
 Pricing Strategies
9. Cost- based Pricing– the basis of mark-up
is the cost of the sales.
Example :
The entrepreneur will compute the cost of
coconut juice by adding the cost of the
account juice (P10.00) and the plastic
container (P4.00). He or she can set the price
at P20.00 to earn P6.00 per coconut juice.
 Pricing Strategies
10. Cost Plus Pricing– The mark-up is based
on the certain percentage of cost
Example :
The entrepreneur wants to set 50% mark-up
on the coconut juice which is P14.00 x 50%
=P7.00; The new price is P14.00
+ P7.00= P21.00
 Place
-refers to a location or the medium
of transaction. A strategic location
depends on the nature of the
business and the primary target
markets.
 Place
-the major objectives of the
entrepreneur for place is to
provide pleasant experience in
buying or availing of the service so
that will keep on coming back.
PLACE
When the business firm wants to emphasize the place variable, it makes the
business company’s products available in the location and time requirement
buyers. The channel of distribution helps implement the business firm’s concern
about the place variable. In reality, it is the link between the seller and the buyer is
the channel of distribution.
It refers to a location or the medium of transactions. A strategic location depends
on the nature of the business and the primary target market. In physical location,
the entrepreneur must research about the area’s population, the traffic, the people’s
common paths, their buying behavior, and their preferences for the location.
 Promotion
-it involves presenting the products
or services to the public and how
these can address the public’s
needs, wants, problems or desires.
PROMOTION
The provision of required information to prospective
customers so that they are persuaded to buy. It involves
presenting the products or services to the public and how
these can address the public’s needs, wants, problems, or
desires. In promotion, the primary target market should
be identified because it will become the main audience.
The main goal of promotion is to gain attention.
Promotional Tools
1. Advertising
2. Selling
3. Sales Promotion
4. Public Relations
Promotional Tools
1. Advertising- Type of
communication that influences
the behavior of the customer to
choose the products or services
of the entrepreneurs over the
competitors.
 Promotional Tools
2. Selling- is the act of trading a product
or service for a price or a fee.
3. Sales Promotion- are short- term
promotional gimmicks wherein practical
incentives and appealing activities are
incorporated to entice the customers to buy
the product or avail the services.
 Promotional Tools
4. Public Relations- are image
building initiatives of the
entrepreneur to make the name of
the business reputable to
stakeholders .
 People
-play a vital role in servicing
customers. Employees become a
major influence in the customer’s
buying behavior.
PEOPLE
These are the people working for the business. They play the vital
role in servicing customers even though the entrepreneur sells only
physical good. With the influx of various competing products and
services, one of the major differentiators is how people or employees
make a difference in the lives of the customers. It is not just about the
quality of products anymore, but how employees serve customers.
Employees have become a major influence in the customer’s buying
behavior.
 Packaging
-it is how the product or service is
presented to customers. It is the
over-all identification (look and
feel) of the product or service.
PHYSICAL
ENVIRONMENT/PACKAGING
Packaging is how the product or service is presented to customers.
It is the overall identification (look and feel) of the product or
service. This will determine the uniqueness of the uniqueness of the
product from the competitors. This is the first element that
customers see because they don’t know what’s inside yet.
To create the tangible expression of the brand engaging the senses
through the layout and images of the service cape.
 Process
-began to realize the importance
of internal and external
operations of the business to serve
customers better.
- Defined as the step by step
procedures or activities .
PROCESS
To experience how the brand delivers value.
It includes the external and internal operations of the business to serve customers
better.
It defined as a step-by-step procedure or activity workflow that the entrepreneur or
employees follow to effectively and efficiently serve customers. It components
include input, throughput, and output. The internal process includes the back-office
operations wherein employees or machines process customers requests without
necessarily being seen by the customer. The external process includes the actual
servicing where customers are part of the process.
Big Idea!!!
The original 4P’s (product, place, price, and promotion) of the
marketing mix already evolved to 7P’s, which now include people,
packaging, and process to cover service businesses as well. When
used effectively, the 7P’s of marketing will achieve the two most
important objectives of an entrepreneur:
Customer satisfaction and profitability.
Thank you and God bless!