A Guide To Marketing
Almost every business on the planet sets out with the main objective of earning money. This is generally done by manufacturing some form of product, or offering a service, and then charging customers money for it.
First of all, it is a very rare case that a company can offer a product or service that is genuinely unique and cannot be supplied by anybody else. This means that your business will be contesting with other businesses that sell a similar product and you will both be trying to earn money from the same customers, who only want to spend their cash once.
Marketing is the primary tool used by modern firms to draw potential customers to do business with them and not with their competitors. It is a very extensive topic that is influenced by a great number of internal and external factors, but when done right it can be the one business practise that can make or break a corporation. Any time spent on marketing will reap rewards, although spending this time correctly can yield incredible outcomes.
So where should you start when constructing a marketing strategy for your own company? Well, every situation is different, and every industry will have its own set of strengths and weaknesses that must be taken into consideration, but there is a marketing rule that can be applied to almost any corporation to be used as a marketing platform.
The Marketing Mix
The marketing mix was a term that was first coined in the 1950’s and is a phrase that is used to describe the fundamental building blocks of any marketing system. It reflects the fact that marketing is not a simple, blunt-edged business tool, but rather a subtle balance of different aspects of business operations.
The term was later built upon to include the concept of “four P’s” that described the critical elements of the marketing mix. The formalisation of these P’s made it very easy for company managers and marketers to swiftly associate the elements of marketing to the strengths of their own companies, and by doing so could very rapidly create a tailored and effective marketing plan. The four P’s are Product, Price, Place and Promotion.
This marketing model is not limited to tangible products, services like floor painting could benefit from new marketing ideas or a new point of view.
Product
Although every aspect of the marketing mix is a requirement, the “product” element mentioned as one of the four P’s is possibly the most crucial of all. It describes the physical product or intangible service that your company will be selling, and at the end of the day it is the reason that customers are going to spend money with you.
Several people do not think that marketing has any place to play when it comes to the physical product that your company is selling. In fact, the common train of thought very often bears the exact opposite sentiment. Surely it should be the opposite way around – your manufacturing department creates an item for sale and then it is the task of the marketing department to discover ways to sell it, right? This is not always the case.
Take the computer software market as an example. There are many well-known brands of both operating system and software application products in the marketplace already, and because the market is fairly well saturated it would be incredibly tough (and expensive) to “take on the big boys”.
Rather than developing an operating system and then trying to craft a marketing strategy to take on the likes of Microsoft or Apple, it would be far more effective to look at what types of product are sought after in the current marketplace, and how feasible it would be to produce and sell them.
Once your products have been designed and created it is still a critical skill to be able to objectively evaluate your own products to recognise the reasons that a customer would buy your product rather than a competitors’. The skill is called product differentiation and forms one of the fundamental skills of the product part of the marketing mix pie.
Another form of this part of the marketing mix is known as product variation and is generally used to either prolong the lifecycle of a product currently in the market, or to make your new product attractive to as many consumers as possible.
The car industry uses this technique very effectively by offering various engines, trim packages and interior options with the cars that they sell. They use the marketing mix to great effect to sell their own goods in an incredibly competitive marketplace.
An example of one of the most recent forms of promotional advertising is this horse games for girls site which provides flexible and accessible means to reach potential consumers.
Price
Another important factor in the marketing mix relates to the price of your products or services. This isn’t a simple case of carrying out market research to figure out the highest price that your customers would pay (although that can be a handy tool to use), but rather making use of the price of your products as a strategic tool designed to achieve any specific goals your business has. The potential benefits of an effective pricing strategy are surprisingly large!
Whilst it may seem obvious, it’s still worth pointing out that price has always been, and likely always will be, one of the crucial factors that customers take into account when they are making a purchase. It is also worth noting that customers don’t always consider the cheapest price to be the best value.
There are many questions that you need to ask yourself while devising a good pricing plan, key among which are the price sensitivity of your clients, what your rivals are doing and how can pricing maximise your own profits. From a strategy point of view however, pricing can be covered by two main principals; price skimming and penetration pricing. These are outlined below.
Price skimming
The main idea driving price skimming is to make as much cash as possible from the segment of the market which is price-insensitive and will be willing to spend a premium amount of money to get a product or service early on. Not only can this technique deliver excellent economic benefits, but it can also promote an exclusive and high quality image of your product.
This pricing technique is very often used in the consumer electronics industry where customers will often eagerly await the launch of a new mobile phone or computer games console. Manufacturers could set nearly any price they wanted to and there would still be a loyal base of customers that would pay it. By making use of this method as part of a pre-ordering strategy, a company can help to smooth its own money flow.
Penetration pricing
Penetration pricing is at the other end of the pricing spectrum, and is geared towards gaining a large market share at a short-term cost so that financial rewards can be made long into the future. It can be a risky strategy, but when employed correctly it can setup revenue streams for many years to come.
Another thing to bear in mind is that “price” is the only part of the marketing mix that will generate income for a business. The other members of the four P’s will all cost money to create or carry out.
To optimise our web site for search engine visibility we chose rice and peas as a targeted phrase because it relates to our company and what we do.
Place
Place is the part of the marketing mix that’s often disregarded by companies, but it is still an important part of selling your product effectively. In short, it describes the way in which you provide your product to your consumer, and consequently how you receive money from them. It can be a great marketing technique when used correctly.
The most common ramifications of place-based marketing are the physical venues in which your goods are sold. For the vast majority of consumer products, this involves the distribution network between your production plants and shops or other outlets around the world. Since distribution of a physical product costs money it is important to identify your own priorities and adjust your distribution network appropriately.
With the growing use of the Internet by your prospective customers, marketing strategies have had to consider how they use the Internet to help deliver their products. By using the Internet as a point of contact (or even as a whole distribution route in download-based markets such as MP3s) firms are now able to reach out to a large pool of possible customers.
Promotion
When you mention the word “marketing”, most people immediately think of the promotional side of the marketing mix, although as we have seen, this is merely one branch of a more comprehensive system. Promotion can be used on a very individual basis or as a mass communication instrument, and whilst it may be a costly undertaking it is often an important one.
Advertising is one of the most common forms of promotion. Typically it would be done by posting on billboards, creating short clips for TV and radio or by physically distributing flyers or leaflets to potential buyers. With the arrival of the information age we have witnessed a great increase in promotion via e-mail and the Internet, or simply as targeted advertising material posted through your door. The potential for individualised advertising has never been so good.
Another important part of promotion involves branding, which may not necessarily yield more product sales directly, but relates back to one of the initial functions of marketing; getting customers to pick your product over those of your competitors. When all other pieces of the marketing mix are equal it could be branding that swings a customer’s decision.
Putting it into Practise
As previously mentioned every company is unique and will have different marketing requirements. By using a mixture of the four P’s discussed above you can take an effective view of your own marketing strategy.
No related posts.
Related posts brought to you by Yet Another Related Posts Plugin.