What Is Markeitng? Essay, Research Paper
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WHAT IS MARKETING
DEFINTION OF AMA:
1-identifing the wants and needs of the consumer and coordinately create products to satisfy these needs profitably and efficiently.
2- process of planning and executing the conception, pricing, promotion, place (distribution), ideas, goals and services to create exchanges that satisfy objectives.
HISTORY OF MARKETING:
PHASE 1: This was the production-oriented period. There were few products and many customers (demand * supply). As a result the focus of the companies was on the transportation and distribution.
PHASE 2: This was the sales oriented period (50 years ago). The principle of this period was ?produce then sell? or we can say, ?sell no matter what. So in this environment the ads were lying.
PHASE 3: This was the marketing oriented period. As the ideology of this period was ask the main question first which is ?WHAT DO THE PEOPLE WANT?? This way is chartered by being easy and cheaper. This was started by ?GENERAL ELECTRIC COMPANY?.
TASKS OF THE MARKETING DEPARTMENT:
1.To discover, locate, measure. This means that the marketing dept. has to discover what the people want and how they want it and how much they want it (demand)
2.To interpret this information for management, so they can produce products. This means mixing the information gathered in task 1 and give a result, either produces or not.
3.Develop and implement a plan to make these products available. I think that this is the most important this about marketing as a good marketing plan means that tasks 1&2 are made right.
USEFUL CONCEPTS:
A- COMPETITION:
The big question here is ?WHAT IS Competition?? Well I think that whenever there is more than one person wants the same thing there is competition. Completion is two types PRODUCT completion and CATECORY competition. Product competition is the competition that occurs between substituted products. Category competition is the competition that occurs between different products but targets the same people.
B- SEGMENTATION:
Segmentation is the process that divides the market in to smaller units that the company can survey effectively or we can say that it is grouping the market in to TARGET ADUIENCE with similar characters and needs. This part is important because it makes focusing on the people that the company rely benefit from or target on.
This were the 80%-20% rule jumps in to the subject as the company?s profit come from 20% of the target audience, so it is more correct to focus on these people and not loosing them, this is easy with the right segmentation.
C-COMPETITIVE ADVANTAGE:
An advantage is the difference between to things. So the competitive advantage is the difference between to competitive products. I think that this advantage is the source of the commerce as trade is based on advantages. So to make a position to your product you must have an advantage. Competitive advantage is two types price & quality. Price advantage is delivering the same quality at a lower cost. Quality advantage is delivering a better quality at the same cost. The quality advantage is also called the marketing advantage.
D-POSITIONING:
Positioning is not a thing you do with your product it is a thing you do with you consumer mind. Positioning is the space or the image your product occupies in the prospect?s mind. It can also be defined as ?how does the consumer see our product?. The positioning gives the product its personality and its image.
E-FEATURES VS BENEFITS:
A feature is a character while the benefit is the added value that is obtained on using a product. So it is not correct to try to deliver a massage that is feature oriented, as you rely sell the benefit not the feature. As an example when you sell a lady an eye shadow, you are not selling the chemical components, but you are selling the hope of being beautiful to this lady.
F-FEEDBACK:
The meaning of the word is when you feed you must have a feedback. This is the same as when you feed the market with product do not forget to have your feedback because it is a tool of indication of corrections. As many mangers forget this feedback, it is called THE FORGOTTEN ART. It also means the response or reaction from the target audience, which is made by research.
G-MARKETING MIX:
Some call the mix ?THE 4 P?S? and some call it ?THE 6 P?S?. This happened due to the difference of looking to importance between marketers.
vPEOPLE: who? It means to whom we are talking.
vPRODUCT: what? It means what are we going to give.
vPLACE: where? It means where are we going to give. (Distribution)
vPACKAGE: what?
vPRICE: How much does our product should cost?
vPROMOTION: Is the element that involves policies and procedures related to {personal selling, advertising, publicity, and budget and trade promotion.}?
THE FIVE ?C?S?:
1.CUSTMER: find their needs ? listen to them ? get their input early.
2.COMMUNICATION: thru promotion you can make the consumer know your product.
3.CINVENIENCE: available ? package
4.COST: price ? time ? usage
5.COMMUNITY: impact on the community (public relation)
The 5 c?s are what we can say, the equation of marketing success. You will be marketing successful if you: find your consumers, detect their needs, closed the loop and listen to them, communicated with them, made your product convenient to them, at a suitable cost and effects the community with the correct way.
FIND YOUR TARGET AUDIENCE
DETECT THEIR NEEDS
COMMUNICATE AND LISTEN TO THEM
COST=PRICE, TIME, USAGE, ??????????.
THE EFFECT ON THE COMMUNITY
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CLASSIFICATION OF MARKETS
It means the different types of markets:
1-CONSUMER MARKET:
We can say that this is the end-user market. People in this market purchase final products to use.
2-INDUSTRIAL MARKET:
The people in this market are companies that buy the final products of another company to make process on it to produce another product. Example for that is a company that produces car tiers buys rubber from another company that produces rubber. In this type of markets the retail selling is not effective as the personal selling and it is almost the only way. This market is also called the bissnsee-to-bissness market.
3- RESELLER MARKET:
This market consists of stores that buy to sell, to consumer or other stores. This chain varies from one product to another.
4-GOVERNMENT MARKET:
This market resembles the industrial market, but it has it?s own rules and it is very sensitive market. Buyers in this market are governments so the products are used in a governmental usage.
5-SERVICE MARKET:
Products here are invisible, example: airlines ? hotels ? accountants. The most, hard part here is measuring the quality level. This market is increasing in competition.
6-NON PROFITABLE MARKET:
This market consists of companies that do not aim to making profit. Example: hospitals ? educational institute.
7-INTERNATIONAL MARKT:
This market consists of all the above kinds of markets, but out side your home country or over seas.
Market segmentation
?IT IS THE STRATEGY OR THE WAY TO DIVIDE A MARKET IN TO GROUPS OR SEGMENTS OF CUSTOMERS WITH THE SIMILLER NEEDS AND MEETING THESE NEEDS WITH MARKETING EFFORTS.?
In that way it allows you to focus on your target audience (80%-20%).
MARKET SEGMENTATION PROCESS:
1.The company conducts a situation analysis.
2.The company identifies marketing opportunities (niche).
3.The company estimates the market potential.
4.The company makes a marketing research and evaluate competition.
5. The company segments the marketA-Identifying the segment.B-Target the segment.
6.The company develops a marketing mix (the p?s).
7.Evaluate results and implementation.
Identifying the segment:
1.GEOGRAPHICAL SEGMENTATION: This is the simplest way to identify segments. People are segmented thru their geographical position. Example: people in Alex. ? In Cairo.
2.DEMOGRAPHIC SEGMENTATION: The study of numerical characteristics of population. Example: sex-age-religion-education-occupation-income-??It means any character that can be measured.
3.BEHAVIORESTIC SEGMENTATION: It is dividing people according to their use of the product.
a.Purchase occasion: Buyers are distinguished by when do they use the product. Example: traveling-making party ?every day.
b.BENEFITS: Sought what kind of benefits people are looking for. Example: rebox(comfort)-nesscafe(pleasure)
c.USER STATUS: People are gathered according to their type as users. Example: old users-new users-potential users.
d.USAGE RATE: Defines consumers according to their rate of usage. Example: heavy user-moderate users-light users. This type of segmentation is also called the volume segmentation.
e.BRAND?S PURCHASEST: People are divided according to what brand do they use or buy. Example: the lipton?s-the rebox?s.
4-PSYCHOGRAPHIC SEGMENTATIOM: In that way we segments the market on the basis of the psychological make up of the consumer, such as personality, life style, attitude.
PERSONALITY TYPES:
1.INNOVATORS: Ready to try new ideas and willing to risk a bad experience.
2.EARLY ADOPTERS: They are people that other people refer to. They are careful and successful innovators.
3.EARLY MAJORITY: They are people that think then buy.
4.LATE MAJORITY: They are people that buy after all people had bought.
5.LAGGARDS: They are people that are past oriented, very late adaptation. Example: people that did not buy video player till now.
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CRITERIA FOR SELECTING A TARGET SEGMENT
1.SIMILARTY OF NEEDS: No matter what you use to segment the market, people in the segment need to have similar needs.
2.UNMET NEEDS: You must target a particular segment who?s needs are not met by a competitor.(MARKETING NICH)
3.THE SAIZE OF THE SEGMENT: The size of the segment does link to profitability but not all the time. A small segment can be highly profitable as long as they can establish a very unique competitive advantage. Example the JAGWAR segment. (this kind of segment must be sustainable)
4.GROWTH POTENIAL: We must ask our selves here does this segment likely to attract more customers in the future or not.
5.ACCESSIBILITY: Does the segment accessible. Can I reach my target audience thru media or some other means. If a segment does not have distinctive demographic characteristics then accessibility would be difficult.
STRATEGIES FOR SELECTING A TARGT SEGMENT
PRODUCTS
ONE SEVERAL
SEGMENTSONE SEVERALCONSENTRATEDSEGMENTATIONPRODUCT-LINESEGMENTATION
MARKETSEGMENTEXPENIONDIFFRENTIATEDSEGMENTATION
vCONSENTRATED SEGMENTATION: Smaller companies with limited resources can only serve one segment with one product.
vMARKET SEGMENT EXPANSION: As well as the segment have a well defined need for the same product then company can expend the segment. Example: the Kellogg serial (from children to adults), j&j shampoo (no more tiers), secret deodorant (from women to men)
vPRODUCT-LINE SEGMENTATION: In this case you serve one segment with many products. Example: el shamadan (many products are delivered to children)
vDIFFERNTIATED SEGMENTATION: In this case you deliver many products to several segments. This is mostly done with big companies as the marketing cost (ads, promotion,?) are so high. Example: P&G shampoo (h&d for dandruff-ponten for female-pert plus for youth)
THE PRODUCT
DEFINETION: A bundle of benefits and attributes designed to satisfy customer?s needs.
Any product consists of 3 dimensions:
1.Core product: The benefits.
2.Tangible product: The futures.
3.Augmented product: Delivery, credit, service, added value.
PRODUCT DEFFERENTIATION: It means how is one product different from another product.
1.Perceptible difference: This kind of difference is very clear and obvious.
2.In perceptible difference: This kind of difference is not clear or not ready apparent. Example: cigarettes-car engines.
3.Induced difference: This kind of difference is created by advertising, between similar products. Example: mobile oil and shell oil both are gasoline, siwa water and barka water both are mineral water.
PRODUCT CLASSIFICATION: There are two ways to classify products.
1.Degree of tangibility: Products are classified by their degree of tangibility. Starting from the most tangible, passing by moderate tangibility, ending by the least tangible. Most and moderate tangibility are sub-classified in to durable and non durable as shown in the diagram.
air conditioning foods service
Durable goods: Products that are used along a long interval of time. Consumer needs a lot of thinking and comparison on purchase, so personal selling is effective in this case. Example: air conditioning devices.
Non- durable goods Products that are used or consumed on a short interval of time. This kind does not need a lot of thinking and comparison from the consumer on purchase, so advertising is effective in this case. Non- durable goods are sub divided in to packaged goods like food and sun dry paste and non- packaged goods like bread and gasoline.
2.Buyer: This classification is made by the one who buys the product. Example: personal products which are bought by consumers- industrial products which are bought factories.
WHAT IS A NEW PRODUCT?: a new product is
Invention: Creating a product from no where. Example: sony invented the cd rom.
Innovation: Development of an existing idea and it is done by two ways.
vNew product duplication: A product that is known to the market but new to the company. Example: Panasonic producing cd roms.
vProduct extant ion: A product that is known to the company but new to the market. Example: coca cola 2 liter.
WE CAN SAY THAT A NEW PRODUCT IS:
vStarting to produce a product. (new product duplication)
vResearch and develop a new product. (invention)
vSame product and different segment. (product expansion)
vRevise or add a product ( product expansion).
vRepositioning (change image).
USEFUL DEFINETIONS
BRAND: A name or a symbol that represents a product.
PRODUCT CATEGOTY: The category of a product is the generic class to which the brand belongs. Example: shampoo-asprin-trencolizers.
PRODUCT LINE; In the books it refers to a line of offerings with in a product category. But in the practical life it refers to al the products the company produce.
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WHY NEW PRODUCTS SUCCSSEED?
1.The consumers ?s satisfaction degree. It means to what degree the product matches the consumers needs.
2.The existence of expertise in the company or what is called the know-how.
3.The product has established competitive advantage.
4.An organizational environment that encourages entrepreneur ship.
5.The established new product development process.
WHY NEW PRODUCTS FAIL?
1.The poor marketing research and analysis, or the misreading of the consumers needs.
2.The poor product positioning.
3.The poor product performance or quality.
4.The poor competition analysis.
ETHICAL ISSUES IN PRODUCTS DEVELOPMENT
1.PRODUCT SAFTY: Control and expenses for safety. Example: food, children toys.
2.PRODUCT PREFOMANCE: Measuring the product performance, to be sure that the products are up to standard through quality control. We can say that there is a direct link between performance and profitability.
3.PRODUCT INFORMATION: Example: writing the product?s ingredients on the package.
FUNCTIONS OF PACKAGING
1.CONTAINTMENT AND PROTECTION: This gives the product its safety and makes it possible to take the product home.
2.CONSUMER APPEAL: Example: shape-size-color-reusable containers (sales promotion ex.la vach ceree cup). This appeal could be your competitive advantage in some cases. Example: milk-mineral water.
3.IDENTIFICATION: This gives the product its personality. Example: trade mark-company name-brand name. The examples give the product its visibility and belonging in the out let.
4.CONVENIANCE: The product packaging must survive the storage and shipping. Exemple : milk cartons.
5.COMMUNICATE INFORMATION: This gives the consumer the way or directions using the product. Example: macaroni and rice.
PRODUCT LIFE CYCLE
The life cycle of a product consists of four phases or stages. Introduction, growth, maturity and decline. The marketing strategy to be implemented depends on the phase the product is in. this life cycle helps to understand the position of products more clearly.
1-INTRODUCTION PHASE: I n this phase the new product is introduced in to the market for the first time. The company aims to create awareness and simulating the primary demand. Losses occur in this phase.
Phase strategy:
vAdvertising role is to stress on information about the product and what does it do.
vPromotion is directed to trade to increase distributors and retailers to carry the product to the market.
The goal of the phase: Creating awareness or BRAND ESTABLISHMENT and building a distributing network to make the product available to the consumer.
2-GROWTH PHASE: In this phase the sales volume increase rapidly and the product becomes profitable. The demand consists of first purchase consumers and repurchase consumer. The repurchase consumers make up the sustainability of the product. Also they are the link to the maturity phase. The competition emerges in this phase.