The market price is the price determined by the free play of demand and supply. The market price of a product affects the price paid to the factors of production – rent for land, wages for labor, interest for capital and profit for enterprise. In fact, price becomes a basic regulator of the entire economic system because it influences the allocation of these resources. The pricing decisions must take into account all factors affecting both demand price and supply price. The price determination process involves the following steps: Market Segmentation : On the basis of market opportunity analysis and assessment of firms strengths and weaknesses marketers will find out specific marketing targets in the form of appropriate market segments. Marketers will have firm decision on : (a) the type of products to be produced or sold, (b) the kind of service to be rendered, (c) the costs of operations to Continue reading
Marketing Management
Marketing management combines the fields of marketing and management. Marketing consists of discovering consumer needs and wants, creating the goods and services that meet those needs and wants; and pricing, promoting, and delivering those goods and services. Doing so requires attention to six major areas – markets, products, prices, places, promotion, and people. Management is getting things done through other people. Managers engage in five key activities – planning, organizing, staffing, directing, and controlling. Marketing management implies the integration of these concepts.
Measuring Advertising Effectiveness
All advertising efforts are directed mainly towards the achievement of business, marketing and advertising objectives i.e., to increase the sales turnover and thus to market the maximum profit. The advertiser spends millions in to this advertising activity. In the background of all these efforts, is an attempt to attract the customer towards the product through advertising. As soon as the advertising campaign is over, a need is generally arisen to measure the effectiveness of the campaign. Whether, it has achieved the desired results i.e. desired sales profitability or results in terms the change in customer behavior in favor of the company’s product which will naturally, affect the future sale of the product. In order to measure the effectiveness of advertising copy, two types of tests pre-tests and post-tests can be undertaken. Pre-tests are generally conducted in the beginning of the creation process or at the end of creation process or Continue reading
Major Differences Between B2B and B2C
Marketing includes those business activities in the flow of goods and services from production to consumption. Goods and services are of two types; consumer and industrial. Firstly, it is important to define the primary difference between Business to Business (B2B) Marketing and Business to Consumer (B2C) Marketing. Both markets are types of commercial transactions, however, simply put, business to consumer (B2C) is the process of selling products directly to consumers and industrial/business to business (B2B) is the process of selling products or services to other businesses. However, the differences between both business systems are much more complex than their simple definitions, so are their similarities. Obviously, both B2B and B2C markets have one fundamental difference: the type of customer. However, this article is going to investigate these markets further, discussing the similarities and differences between their market’s structure, marketing practices and buying behaviour within the industry. Market Structure One key Continue reading
Concepts of Luxury and Masstige
The word ‘luxury’ derives from the Latin word ‘luxus’ , which according to the Latin Oxford dictionary signifies ‘soft or extravagant living, indulgence’ and ‘sumptuousness, luxuriousness, opulence’ . There are two aspects to consider when defining luxury, the psychological value and the value of the product/service itself. The psychological value of luxury comes from its function as a status symbol and from a highly involved consumption experience that is strongly congruent to a person’s self-concept. From a product perspective, luxury brands are frequently defined in terms of their excellent quality, high transaction value, distinctiveness, exclusivity and craftsmanship. In his paper on International Retail Marketing, T.B. Jackson proposes the following as the core characteristics of a luxury product: ‘… exclusivity, premium prices, image and status which combine to make them more desirable for reasons other than function’. Dimitri Mortelmans, in his paper ‘The concept of luxury’, says there are three main characteristics Continue reading
Positioning Strategies in Marketing
Positioning is the strategy of differentiating your product from that of the competition, in the mind of the prospect. A positioning strategy may be developed from the product’s attributes, its specific uses, the type of uses, the product class or category, or the competition. Each of these represents a different approach to developing a positioning strategy. However, all of them have the ultimate objective of developing or reinforcing an image in the minds of the audience. Following are steps of positioning strategies: 1. Positioning by Product Characteristics/Consumer Benefits a) This is a commonly used strategy and consists of associating an object with a product characteristic or customer benefit. “Colgate is a cavity fighter.” The ability to fight cavities is a product attribute that translates into a consumer benefit. b) Sometimes, a new product can be positioned with respect to product characteristics that competitors have ignored. “The toothpaste with clove oil.” Continue reading
Different Approaches to the Study of Marketing
Marketing may be studied by different approaches. To facilitate the study these approaches may be broadly classified as follows: Commodity Approach: The first approach is the commodity approach under which a specific commodity is selected and then its marketing methods and environments are studied in the course of its movement from producer to consumer. In this approach, the subject matter of discussion centers around the specific commodity selected for the study and includes the sources and conditions of supply, nature and extent of demand, the distribution channels used, promotional methods adopted etc. Functional Approach: The second approach is the functional approach under which the study concentrates on the specialized functions or services performed by the marketers and the problems faced by them in performing those functions. Such marketing functions include buying, selling, storage, standardizing, transport, finance, risk-bearing, market information etc. This approach certainly enables one to gain detailed knowledge Continue reading