Principles of Marketing and Marketing Strategies

Posted on Nov 7, 2024 in Economy

Principles of Marketing

Importance of Technological Change

Marketing activities must consider new technologies because customers have new communication methods. Companies must also adapt to these methods.

Flexibility

Given rapid social and technological changes, companies must adapt to market changes.

Directionality

Marketing actions are expensive and must be profitable.

Long-Term Vision

Gaining customers is difficult, but losing them is easy. Due to high competition, companies must dedicate resources to acquiring and retaining customers.

Customer Orientation

Consumers have more product information and choices. Companies must research consumer needs and motivations.

The Marketing Plan

A document describing business goals, action programs, necessary resources, and timelines.

Market Research

A systematic process to obtain reliable and relevant information for strategic marketing planning decisions.

Steps in Market Research

  1. Define objectives.
  2. Design the research plan.
  3. Identify information sources (primary and secondary).
  4. Acquire data (interviews, internet searches).
  5. Analyze data.

Marketing Strategies

Strategies must be flexible to adapt to unforeseen changes.

Competitive Strategies

  • Leader: The company leads the market.
  • Challenger: A secondary market player aims to increase market share.
  • Follower: The company adapts to the leader’s products and prices.
  • Specialist: Focuses on specific market segments.

Loyalty Strategies

Aim to retain customers through incentives for repeat purchases.

Generic Strategies

  • Cost Leadership: Focuses on low-cost production. Pros: Deters new competitors. Disadvantages: Requires high investments.
  • Differentiation: Distinguishes the product through unique elements. Advantages: Allows premium pricing. Disadvantages: Price sensitivity.
  • Specialization/Focus: Targets a specific market segment. Pros: High profit margins. Disadvantages: Limited market share.

The Marketing Mix

  • Product: Goods or services offered to satisfy consumer needs.
  • Price: Monetary amount paid by the buyer.
  • Communication: Activities to inform and motivate consumers.
  • Distribution: Activities to deliver the product to the consumer.

Product Attributes

  • Design: Features for ease of use or differentiation.
  • Quality: Fitness for purpose and meeting customer needs.
  • Quantity: Product content per unit.
  • Package: Protects the product and influences purchase decisions.
  • Brand: Distinguishes the product in the market.
  • Options: Additional product features.
  • Warranty: Period of vendor responsibility.
  • After-Sales Service: Activities for customer satisfaction post-purchase.
  • Expiry: Date after which the product is unfit for use.

Brand Elements

  • Logo: Graphical representation of the brand.
  • Graphics: Visual elements associated with the brand.
  • Slogan: Memorable phrase.
  • Anagram: Combination of logos and graphics.

Product Life Cycle

  • Introduction: Product launch and slow sales growth.
  • Growth: Increasing consumer adoption and rapid sales growth.
  • Maturity: Sales stabilization and increased competition.
  • Decline: Decreasing demand and potential market exit.

Pricing Strategies

  • Promotional Pricing: Temporary price reductions.
  • Penetration Pricing: Low prices for new product introduction.
  • Price Skimming: High prices for quick profits.
  • Psychological Pricing: Considers consumer price perception.
  • Discounts: Temporary price cuts.
  • Price Discrimination: Different prices for different buyers.
  • Prestige Pricing: High prices for perceived quality.

Marketing Communication

  • Advertising: Paid communication to inform and motivate consumers.
  • Public Relations: Manages company relationships.
  • Personal Selling: Direct interaction with customers.
  • Merchandising: In-store product promotion.
  • Loyalty Programs: Encourage repeat purchases.
  • Sales Promotion: Activities to increase sales effectiveness.

Distribution

Choosing appropriate distribution channels is crucial.

Distribution Channels

Pathways between producers and consumers.

  • Short Channel: Few intermediaries.
  • Long Channel: Multiple intermediaries.

Distribution Process

  • Manufacturer: Produces and sells to wholesalers.
  • Wholesaler: Buys from manufacturers and sells to retailers.
  • Retailer: Sells directly to consumers.
  • Consumer: Purchases the product.