A. Product strategies <ul><li>Small unit and low priced packing </li></ul><ul><li>Larger pack sizes are out of reach for rural consumers because of their price and usage habits. This method has been tested by other products like shampoos, biscuits, pickles, Vicks five gram tins, etc. </li></ul><ul><li>In the strategy of keeping the low priced packed the objective is to cover the entire rural community can try. This may not be possible in all types of products, but wherever this can be resorted to, the market is bound to expand. </li></ul>
2. New product designs A close observation of rural household items indicates the importance of redesigning or modifying the products. The manufacturing and marketing men can think in terms of new product designs specially meant for rural areas keeping their lifestyles in view. 3. Sturdy products Sturdiness of a product either in terms of weight or appearance is an important fact for rural consumers. The product meant for rural areas should be sturdy enough to stand rough handling and storage. People in rural areas like bright flashy colours such as red, blue, green etc., and feel that products with such colours are sturdy but they are more concerned with the utility of the item also.
4. Brand name The rural consumers are more concerned with the utility of products. The brand name awareness in the rural areas is fairly high.A brand name or logo is very essential for rural consumers for it can be easily remembered. FW15-MARKETING MIX INTRODUCTION Marketing mix allows you to combine all the marketing tools in order to sell your product. Objectives: The objectives of this lesson about marketing mix is to give you: -The tools you need for establishing your detailed marketing plan and forecasting your sales. 1. Challenge 2. Product 3. Place 4. Price 5. Promotion 6. Sales strategy 7. Do it yourself 8. Coaching
1-CHALLENGE You have got a rough idea about the market situation and the possible positioning of your product. Of course, it's far to be sufficient. Now, you must write your detailed planning. It means that brainstorming is ended and that you have to go to the specifics in examining and checking all the hypothesis you had made in the preceding chapters. You will use the marketing mix. -Defn: Marketing mix is the combination of elements that you will use to market your product. There are four elements: Product, Place, Price and Promotion. They are called the four Ps of the marketing mix.
. Some people think that the four Ps are old fashionable and propose a new paradigm: The four Cs! Product becomes customer needs; Place becomes convenience, price is replaced by cost to the user, promotion becomes communication. It looks like a joke but the Cs is more customer-oriented
<ul><li>2-PRODUCT </li></ul><ul><li>A good product makes its marketing by itself because it gives benefits to the customer. </li></ul><ul><li>If, the competitors products offer the same benefits, same quality, same price. You have to then differentiate your product with design, features, packaging, services, warranties, return and so on. In general, differentiation is mainly related to: </li></ul><ul><li>The packaging </li></ul><ul><li>The design </li></ul><ul><li>The safety </li></ul><ul><li>The green </li></ul><ul><li>3-PLACE-DISTRIBUTION </li></ul><ul><li>The question " how to reach the customer" must always be in your mind. </li></ul><ul><li>-Definition: The place is where you can expect to find your customer and consequently, where the sale is realized. Knowing this place, you have to look for a distribution channel to reach your customer. </li></ul><ul><li>Note:The place is not where your business is located but where your customers are. </li></ul>
<ul><li>Selling to customer </li></ul><ul><li>Selling to retailer </li></ul><ul><li>Selling to wholesaler </li></ul>
33-The image The place of sale influences the perception of your product. Consequently, you must pay attention to the choice of your outlets: wholesalers and retailers. If you sell products for every one, a mass distribution through the supermarket will be probably the best issue. On the contrary, if you sell fine products, you have to choice fine shops and beautiful people to sell them. In the fun board case, you should have better to emphasize on the image and to look for fashionable shops and people. 4-PRICE Price means the pricing strategy you will use . You have already fixed, as an hypothesis a customer price fitted to your customer profile but you will have now to bargain it with the wholesalers and retailers. Do not be foolish: They know better the market than you and you have to listen their advices. 41-Pricing strategies In fact, you have to choose between three strategies: -Competitive pricing: If your product is sold at the lowest price regarding all your competitors, you are practicing competitive pricing. Sometimes, competitive pricing
-Cost-plus-profit: It means that you add the profit you need to your cost. It is also called cost-orientated strategy and is mainly used by the big contractor of public works. The authority may have access to the costing data and should like to check if the profit added to the cost is not too high. In fact, this strategy is only good for a business whom the customers are public collectivities or government agencies. -Value pricing: It means that you base your prices on the value you deliver to customers. For example, when a new technology has a very large success, you can charge high prices to the customer. This practice is also called skimming . It is easy when you are in the introductory phase of the product life cycle. Value pricing is also common in luxury items. Sometimes, the higher the price, the more you sell : Fashionable clothing or restaurants for snob people. Of course value pricing is limited by the price elasticity as you have already learnt in Economics.
<ul><li>5-PROMOTION </li></ul><ul><li>Advertising, public relations and so on are included in promotion and consequently in the 4Ps. Sometimes, packaging becomes a fifth P. As promotion is closely linked to the sales, I will mention here the most common features about the sale strategy. </li></ul>
-Definition: The function of promotion is to affect the customer behavior in order to close a sale. -Advertisement: It takes many forms: TV, radio, internet, newspapers, yellow pages, and so on. You have to take notice about three important notions: Reach is the percentage of the target market which is affected by your advertisement. For ex: if you advertise on radio you must know how many people belonging to your segment can be affected. Frequency is the number of time a person is exposed to your message. It is said that a person must be exposed seven times to the message before to be aware of it. Reach*frequency gives the gross rating point. You have to evaluate it before any advertisement campaign. Message: Sometimes, it is called a creative. Anyway, the message must: get attraction, capture interest, create desire and finally require action that is to say close the sale.
-Promotion: Promotion includes three topics: advertisement, public relations, and sales promotions. -Public relations: Public relations are more subtle and rely mainly on your own personality. -Sales promotion : It includes fair trades, coupons, discounts and are linked to the sales strategy. 6-SALES STRATEGY Sales bring in the money. Salesmen are directly exposed to the pressure of finding prospects, making deals, beating competition and bringing money. You have first to learn some definitions used by the MBA lingo:
61-Definitions : A lead is a person who has been identified as a prospect. A prospect is a potential customer. An account is a customer that often buys from the company. A national account is a very big customer On the contrary, active selling involves locating customers and persuading them to buy. Inside sales refers to selling done mainly by phone or by internet. Outside sales involves getting appointment to meet customers at their home. Home cold calling means to phone people you do not know. Hard sell means to use of high pressures upon the prospect. 62-The sales process: It depends heavily on the buying process . It includes prospecting and persuading.
Prospecting involves finding the leads and presenting the product. After making contact, the salesman must show that the product solves a customer's problem. He must also answer two questions : - Has the prospect a need or an interest in the product ? - Does the prospect have the money to buy the product ? If the prospect does not meet these criteria, you have better to move on to the next prospect ! Persuading and authority are often necessary to close a sale. The salesman's approach is often to rise questions in order to lead the prospect to a logical conclusion : I must buy now. -The sale organization: The two major issues are to recruit salesmen or to organize a franchising or or multi-level market
If you recruit the salesmen: -You should determine the size of the sales force: It must cover the customer segment. A poor coverage is an invitation to competitors. Remember the production possibility frontier to determine your maximum sales force. Alignment by territory divides the market into geographical areas such as counties or cities and specializes each salesman in an area. Alignment by product specializes each salesman in a product. Alignment by customer specializes each salesman in a customer (it means that the customer must be a national account).
<ul><li>But how to convert any product in a high involvement product? </li></ul><ul><li>The best way is to create a value expressive message about the product. You have to link the product to very high involvement issues. For example : health, social status, youth, success, and so on. This link must be seen by the consumers as a very important characteristic (in fact, this characteristic is only subjective. It just exists in the consumer's mind). </li></ul><ul><li>2) A product provides different benefits : For example, a single garment brings you three benefits : it is warm, it is fashionable and it is easy to clean. </li></ul>
New Product Development(NPD) <ul><li>Once a company has carefully segmented the market, chosen its target customer groups, identified their needs and determined its desired market positioning, it is ready to develop and launch appropriate new products. The NPD process is classified as: </li></ul><ul><ul><li>Idea generation </li></ul></ul><ul><ul><li>Concept testing </li></ul></ul><ul><ul><li>Product development and </li></ul></ul><ul><ul><li>Test marketing. </li></ul></ul><ul><ul><li>Some examples of NPD are kisan credit card 5kg cooking gas of cylinder by HPCL,etc. </li></ul></ul>
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