Core Marketing Functions, Research, and Pricing Strategies
Commercial Function and Marketing Planning
The Commercial Function Defined
The commercial function is responsible for defining what, how, when, and to whom a company should sell for profit, and for monitoring the suitability of the results against the projections made.
The Marketing Plan
The marketing plan is a document describing the business objectives, action programs, the expected results, and the timetable for conducting every action.
Market Research: Understanding the Consumer
Market research is a process of investigation that aims to obtain relevant information about the consumer, the degree of competition, and other environmental characteristics that affect the product.
Stages of Market Research
- Definition of objectives.
- Design of a research plan.
- Search for sources:
- Primary sources: Data collected specifically for the current project (e.g., opinions of people, surveys).
- Secondary sources: Data developed prior to the project (e.g., statistical studies, population data).
- Data collection.
- Data analysis.
Marketing Strategy and Product Development
Marketing strategy development is the approach a company takes, focused on meeting the needs and desires of consumers while providing benefits to the company.
Product Definition and Attributes
A product is any good or service, or combination of both, which is offered with the aim of satisfying consumer desires.
Key product attributes include:
- Design
- Quality
- Quantity
- Shelf life
- Packaging
- Post-sale service
- Warranty period
- Options
- Brand (Mark)
Defining the Brand (Mark)
The brand (mark) is the name, sign, or design that distinguishes or serves to distinguish a particular product in the market.
Essential Pricing Strategies
Pricing strategies are crucial for profitability and market positioning:
- Promotional Prices: Used to facilitate the sale of a product at a particular time or to capture attention regarding the product.
- Penetration Pricing: Prices are set lower than usual to foster the introduction of a new product, especially in markets with strong competition.
- Prices of Skimming: Setting high initial prices to obtain quick profits, often at the cost of future benefits.
- Psychological Prices: Utilizing pricing points that buyers are sensitive to (e.g., ending prices in .99).
- Discounts: Temporarily lowering the price for a small period of time.
- Price Discrimination: Applying different prices to the same product based on factors like the sales area or customer segment.
- Prestige Pricing: Setting a high price to associate the product with quality (expensive = good).
Advertising Principles and Micromarketing
Key Principles of Effective Advertising
Effective advertising should be:
- Credible
- Clear
- Repetitive
- Timely
- Attractive
Elements of an Advertising Campaign
- Message: Defines concisely what the company wants to convey to the consumer.
- Way (Appeal): Must awaken a need for the product in the consumer.
- Budget: The total amount of funds the company allocates for its advertising campaign.
- Media: Channels used for delivery (e.g., television, radio, print, digital).
Micromarketing and Merchandising Techniques
Micromarketing refers to techniques used to encourage the purchase of a product at the point of sale. Key aspects include:
- Product Placement: Strategic placement of products within the premises, often along paths frequently taken by customers.
- Shelf Location: Placing products where they capture the most attention on the shelves.
- Sensory Elements: Use of music and musical elements, or posters at the entrance, to influence the mood and association with a specific product.