Marketing Management: A Comprehensive Guide

Posted on Oct 19, 2024 in Economy

Marketing Management

Evolution of Marketing

  1. One of the earliest advertising methods involved painting ads on walls. This practice dates back to ancient Rome, with examples found in Pompeii advertising properties for sale and taverns.
  2. During the Middle Ages, town criers announced events.
  3. Print advertising emerged with the invention of the printing press, giving rise to the first trademarks and symbols.
  4. Around 1870, newspaper and magazine inserts were used to market patented medicines.
  5. In the late 19th century in the United States, packaged products began to be sold under brand names.
  6. The advent of electricity led to the creation of neon signs and improved printing techniques.
  7. In the 1920s, radio emerged as a new medium for stimulating sales using voice.
  8. With the arrival of television, businesses had to enhance their marketing skills to utilize visual and audio media.
  9. The internet emerged as a global medium for disseminating advertisements.

Marketing

Marketing is the management area that seeks to identify the unmet needs of a social group and design products or services that meet those needs.

The 5 Ps of Marketing

  • Product
  • Place
  • Price
  • Promotion
  • Process

The purpose of the 5 Ps is to develop a strategy that offers consumers an optimal marketing mix.

Elements of the 5 Ps

Product

A product is defined on three levels:

  1. Core Benefit: The benefits or services a consumer receives when purchasing the product.
  2. Actual Product: The physical product, influenced by brand and features.
  3. Augmented Product: Additional services and benefits offered to consumers, such as installation, warranty, after-sales service, and credit sales.

Classification of Products

Products are classified according to their target market:

  1. Consumer Goods: Purchased by end consumers for personal use. These include:
    • Convenience Goods: Frequently purchased items requiring minimal effort. They are readily available, low cost, and consumers can easily switch brands.
    • Shopping Goods: Consumer goods where the customer engages in a selection and comparison process.
    • Specialty Goods: Identified by their trademark, consumers are willing to spend significant amounts to acquire them.
    • Unsought Goods: Goods that consumers are unaware of or not actively considering purchasing.
  2. Industrial Goods: Consumed by individuals and industries for use in production processes. These include:
    • Materials: Goods that become part of the manufacturer’s product.
    • Capital Goods: Industrial goods that are partially incorporated into the finished product but are required for production, such as plant and machinery.
    • Supplies and Services

Classification of New Products

  1. Innovative Products: Entirely new to the market.
  2. Technologically Enhanced Products: Existing products improved through technology.
  3. Imitator Products: Existing products that are new offerings for a specific company.

Product Engineering

  • Idea Generation
  • Development and Proof of Concept
  • Financial Analysis
  • Product Development
  • Market Testing
  • Marketing

Product Design

The process where producers aim to create an attractive, easy-to-use, simple, and economically distributable product.

Price

The dollar amount a consumer is willing to exchange for a good or service.

Basis of Price

  • Economic Function: Price should be based on costs.
  • Market Demand: Price is determined by the desired sales level.
  • Competition: Price is influenced by the price of similar products.
  • Social Function: Price reflects consumer perception.

Product Life Cycle

The evolution of an item’s sales over its time on the market.

Cycle Stages

  • Introduction
  • Growth
  • Maturity
  • Decline

Packaging

The design and production of a product’s container. It has two functions:

  • Utilitarian Function: To protect the product.
  • Marketing Function: To attract attention and promote sales.

Logo

An image that identifies a product from a specific manufacturer.

Label

Ranges from simple paper to complex graphics. Labels identify, qualify, describe, and promote the product.

Brand

A name, sign, symbol, or combination thereof that identifies and differentiates a seller’s goods and services. These include:

  • Word Mark: One or more readable and pronounceable letters.
  • Figurative Mark: A visual sign or figure.
  • Mixed Brand: Combines a word mark and a figurative element.

Market Concepts

The physical or virtual space where consumers and producers agree on price and quantity. Two main types:

  • Consumer Market: Individuals and households buying goods for personal consumption.
  • Business Market: Organizations buying goods and services for production, including government, institutional, and industrial markets.

Market Segmentation

Dividing a market into groups with different needs and characteristics. Types of segmentation:

  • Demographic: Age, gender, occupation, religion, nationality.
  • Geographic: Physical location.
  • Income: Purchasing power.
  • Psychographic: Social class, lifestyle, personality.

Target Market

A group of buyers with common characteristics and needs that a company chooses to serve.

Penetrated Market

The number of consumers who buy a specific item or service.

Distribution

Planning, implementing, and controlling the physical flow of materials and finished goods to meet customer needs and achieve profit.

Types of Distribution Channels

  • Manufacturer-Consumer
  • Manufacturer-Retailer-Consumer
  • Manufacturer-Wholesaler-Retailer-Consumer
  • Manufacturer-Wholesaler-Retailer-Consumer-Intermediary

Promotion

Making customers aware of product attributes and benefits to encourage purchase.

Promotion Techniques

Advertising

Paid presentation through media to publicize a product.

Advertising Aims

  • Inform: Communicate product existence, benefits, and usage.
  • Persuade: Create selective demand for a specific product or service.
  • Remind: Maintain awareness for established products.

AMAP Code of Ethics

Advertising messages must:

  • Comply with legal provisions.
  • Identify verifiable product characteristics.
  • Use techniques that preserve education, health, family integrity, environmental protection, and respect for individuals.

Principles of Code of Ethics

  • Legality
  • Honesty
  • Decency
  • Truth
  • Dignity
  • Respect
  • Fair Competition
  • Health and Wellness

Commercial Possession

Establishing a product or service in the consumer’s mind.

Sales Promotion

Short-term incentives to encourage sales, such as samples, coupons, and discounts.

Personal Sales

Oral presentations to potential buyers, often at fairs and exhibitions.

Public Relations

Activities aimed at creating a favorable image.

Subliminal Advertising

Using subconscious cues to influence consumer behavior.

Marketing Information System (MIS)

An organized system for generating, analyzing, disseminating, and storing marketing information.

Factors Affecting Product Demand

  • Purchasing Power/Consumer Income
  • Family Life Cycle
  • Fashion
  • Price of Substitute Goods

Market Segmentation

Dividing the market into smaller, uniform groups.

Requirements for Good Segmentation

  • Homogeneity within segments
  • Heterogeneity between segments
  • Segment stability
  • Identifiable and measurable segments
  • Accessible and manageable segments
  • Profitable segment size

Importance of Market Segmentation

  • Understanding consumer behavior
  • Determining service requirements
  • Improving needs identification
  • Improving customer communication
  • Increasing customer retention