Transcript Designing an Effective Marketing Mix

Marketing and the Competitive Environment
Designing an Effective
Marketing Mix
“You can hype a questionable product for a little while, but you’ll
never build an enduring business.”
Victor Kiam
“If you do build a great experience, customers tell each other
about that. Word of mouth is very powerful.”
Jeff Bezos
“In general, my children refused to eat anything that hadn’t danced
on TV.”
Erma Bombeck
2.14 Designing an Effective Marketing Mix
Designing an Effective Marketing Mix
In this topic you will learn about:
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Influences on the marketing mix
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The importance of an
integrated marketing mix
2.14 Designing an Effective Marketing Mix
Influences on the marketing mix
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The traditional marketing mix is the combination of variables through
which a firm achieves its marketing objectives. Commonly, these
are called the 4Ps:
Product
Price
Promotion
Place
However, the extended marketing mix takes into account other
important variables that particularly affect services to make the 7Ps:
People
Process
Physical evidence
2.14 Designing an Effective Marketing Mix
The marketing mix – the 7Ps
Product
Price
Promotion
Marketing
Mix – the
7Ps
Physical
evidence
Place
Process
People
You will need access to the
internet to watch this clip
The marketing mix at Cadbury’s:
Provides information on the
marketing mix at Cadbury’s
plus activity
2.14 Designing an Effective Marketing Mix
Cadbury’s advert ready
for take off.
Does the product speak
for itself so the advert
doesn’t have to?
Influences on the marketing mix
PRODUCT
The goods and services that the firm provides.
Goods are physical or tangible products. You can touch them – a
car or a television.
Services are often non physical or intangible. They cannot be
touched – financial consultancy or teaching.
We will look at product in Section 2.15
2.14 Designing an Effective Marketing Mix
Influences on the marketing mix
PROMOTION
Activities designed to increase visibility and sales of a product.
Firms use different promotional strategies to make their products
more widely known to other businesses and the general public. We
call this the promotional mix.
We will look at promotion in Section 2.16
2.14 Designing an Effective Marketing Mix
Influences on the marketing mix
PRICE
How much a firm will charge for the product being sold.
Firms use different pricing strategies to price their products, taking
into account a number of factors such as market research and the
state of the economy.
We will look at price in Section 2.17
2.14 Designing an Effective Marketing Mix
Influences on the marketing mix
PLACE
The means by which the product will be distributed.
Where will the customer be able to buy the product?
We will look at place in Section 2.18
2.14 Designing an Effective Marketing Mix
Influences on the marketing mix
The 7Ps
Although not specifically stated in the AQA specification these can
help to answer questions on service sector firms. The AQA exams
may be based on firms in the tertiary sector:
People – customer service is extremely important in today’s service
sector in the UK. Staff must be appropriately trained, motivated and
show good communication skills when dealing with customers.
Process – the interrelated tasks and systems in place that help to
achieve the marketing objectives.
Physical evidence – the proof that the firm can provide the service
required. With no physical product the firm can produce case
studies and demonstrations showing the quality of service that they
provide.
2.14 Designing an Effective Marketing Mix
Influences on the marketing mix
The following are companies from 5 different industries:
• Arsenal (or club of your choice)
• Johnson’s Dry Cleaners
• Innocent Smoothies
• Harrods
• Gregg's the bakers
For each company make a list of the 7Ps prioritising which is the most important
all the way down to which is the least important. Justify your decisions.
Produce an A4 poster for one of the companies to show this information.
2.14 Designing an Effective Marketing Mix
Influences on the marketing mix
The most important element of the marketing mix is the product.
However, students should understand that different elements of the
marketing mix have differing levels of importance for different firms
and at different times. Whilst price is clearly more important to a
firm such as Aldi compared to Marks and Spencer it should be noted
that price has become more important to M&S in credit crunch
Britain.
In the BUSS2 exam it is important that you discuss the significance
of each P in relation to the firm in the case study. An answer
regarding Aldi will have a different emphasis than one about M&S.
2.14 Designing an Effective Marketing Mix
Influences on the marketing mix
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There a number of factors that might influence the marketing mix for a firm:
The market and market research – competitors and target market
segments
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Finance – what budget does the company have available?
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People – what are the skills of the people within the firm?
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New technology – what technology is available to the firm?
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The state of the economy – what stage of the economy is the business
cycle at?
Take one element of the marketing mix.
How does each of the above factors affect your chosen P at Marks and Spencer?
2.14 Designing an Effective Marketing Mix
The importance of an integrated
marketing mix
An integrated marketing mix means that all elements of the
marketing mix are dependent upon and complementary to each
other.
PRODUCT
PROMOTION
PRICE
PLACE
2.14 Designing an Effective Marketing Mix
The importance of an
integrated marketing mix
This means that any event with one element of the marketing mix will have
an impact on all other elements:
A high price is likely to mean that the firm is using a premium product to
target a wealthier market segment. The product will be promoted to a
specific market and will be located or placed in locations that are visited
by this target market.
Alternatively, a low price may be targeted at a mass market with a no-frills
product. Promotion might be through mass media and the product will
be placed at locations that are easily accessible and where there are
mass sales e.g. supermarkets.
2.14 Designing an Effective Marketing Mix
Activity – Marks and Spencer
Watch the following video clip
You will need access
to the internet to watch
this video clip
You have been called in by Marks and Spencer as a management
consultant. They are facing challenging conditions with the current
downturn in the UK economy and are looking to adapt their marketing mix
due to lower sales.
You have been asked to come up with suggestions that will boost sales
through changes to the 4Ps at Marks and Spencer.
For each P give a suggestion as to how the company can improve taking
into account the current economic climate.
2.14 Designing an Effective Marketing Mix