We will address the following questions after new product development: How should a company price a new good or service? How should the price be adapted to meet varying circumstances and opportunities? When should the company initiate a price change, and how should it respond to competitive price changes? In the entire marketing mix, price is the one element that produces revenue; the others produce costs. Price is also one of the most flexible elements: It can be changed quickly, unlike product features and channel commitments. Although price competition is a major problem facing companies, many do not handle pricing well. The most common mistakes are these: Pricing is too cost-oriented; price is not revised often enough to capitalize on market changes; price is set independent of the rest of the marketing mix rather than as an intrinsic element of market-positioning strategy; and price is not varied enough for different Continue reading
Marketing Management Basics
Concept of Distribution Channels in Marketing
The Importance of Distribution Most producers use intermediaries to bring their products to market. They try to develop a distribution channel (marketing channel) to do this. A distribution channel is a set of interdependent organizations that help make a product available for use or consumption by the consumer or business user. Channel intermediaries are firms or individuals such as wholesalers, agents, brokers, or retailers who help move a product from the producer to the consumer or business user. A company’s channel decisions directly affect every other marketing decision. Place decisions, for example, affect pricing. Marketers that distribute products through mass merchandisers such as Wal-Mart will have different pricing objectives and strategies than will those that sell to specialty stores. Distribution decisions can sometimes give a product a distinct position in the market. The choice of retailers and other intermediaries is strongly tied to the product itself. Manufacturers select mass merchandisers Continue reading
Power Equations of Distribution Channels
The use of power by individual channel member to affect the decision making or the behavior of other is the mechanism by which congruent and effective roles become specified, roles become realigned, when necessary and appropriate role performance is enforced. There are a number of power equations that may be available to one channel member in his attempt to influence the other and vice versa. 1. Reward power 2. Coercive power 3. Legitimate power 4. Referent power 5. Expert power Let us discuss these power equations one by one; 1. Reward power: This refers to the capacity of one channel member to reward other if the latter conforms the influence of the former. This power base is present in virtually all channel system. The rewards are usually manifest in the perceived or actual financial gains, which channel member’s experience as the results of conforming to Continue reading
Methods of Marketing Research
Marketing research is a systematic and objective study of problems pertaining to the marketing of goods and services. It is applicable to any area of marketing. Research is the only tool an organization has to keep in contact with its external operating environment. In order to be proactive and change with the environment simple questions need to be asked: What are the customer needs and how are they changing? How to meet these changing needs? What do the customers think about existing products or services? What more are they looking at? What are the competitors doing to retain customers in this environment? Are their strategies exceeding or influencing yours? What should you do to be more competitive? How are macro and micro environmental factors influencing your organisation? How will you react t this environment? Methodologically, marketing research uses four types of research designs, namely: Qualitative marketing research — This is Continue reading
Top Reasons for the Importance of Integrated Marketing Communications
More Contact Points Traditional mass media such as radio and TV is used to be a way to advertising a product, brand or service. This type of promotional strategy only can transmit the information to some of the target customers but not all. Therefore, Integrated Marketing Communication is a form of promotional strategy where all the promotional strategies are integrated so that the company able to transmit the message to all the target customers and also the customers can interact with the company brand in many ways. For example, a customer may have heard about one restaurant from their friend which they had been go there before and had a great experience dining at there. After that, the customer goes online to search information about that restaurant which include the menu and price and also make reservations. When the days come, your restaurant have to notice how cozy the place Continue reading