IB Business Marketing Mix

IB Business Marketing Mix A brief IGCSE recap! ● ● Developing goals and strategies is the process of marketing planning. Information about the market is recalled in it (via market research). Usually the process involves: 1) Establishing a marketing audit (examining where the business is currently) 2) Marketing Objectives 3) Monitoring and review 4) Evaluation The Marketing Mix ● ● A combination of the four P’s (+ 3 more for services) Product, price, place and promotion. Product ● ● ● ● ● Can either be a physical, tangible good or an intangible service. E.g. good: car, printer, computer. Service: education, advice. Can be differentiated (usually in terms of the relative customer benefits such as brand image, function, packaging etc) Businesses usually sold a variety of products to have a ”product mix” and increase customer base e.g. Samsung sells mobiles, computers, home entertainment systems etc. Marketing strategies differ according to product type i.e. PRODUCER PRODUCTS ; These are products that are sold to businesses. Usually industrial i.e. raw materials, components, machinery etc. CONSUMER PRODUCTS; Sold to the general public But can be further classified into: ● ● ● ● ● ● ● ● ● Consumer single-use goods; Goods used by the consumer once; will be thrown away E.g. Food Consumer durables; Goods used by the consumer several times; long lasting. E.g. Clothes, Cars Consumer services; Services provided to the customer. E.g. Offering expertise Producer single-use goods; Goods used by the producer once. E.g. Wood for furniture will be used once. However, will be purchased again. Capital goods; Tangible Assets E.g. Electronics Producer services; Services provided by the business E.g. Warranty; repair free of charge to some extent Public Goods; E.g. Passport Public capital; E.g. Library books in public library Public services; E.g. Medical services in public hospital Price ● The value in which the product is sold ● ● ● ● ● Products can be over/under priced ‘Equilibrium price’ ; The ‘correct’ (ideal) price. Prices that are too high; Can result in stock piling Prices that are too low; Can result in stock out Pricing decision depends on: + DEMAND + RIVALRY + AIMS + SUPPLY + TIME + IMAGE + COSTS OF PRODUCTION Place ● ● ● 1. 2. 3. 4. Also known as distribution Describes the way in which the product is distributed to the customers (i.e. the method) Classified with the distribution channel: Mail Order Direct Sales Retailers Wholesalers Promotion ● ● ● ● The strategies the business chooses to use to attract the customers to purchase Can be above/below the line ATL (above the line) revolves around mass media i.e. television, radio, newspapers etc. BTL revolves around the other promotional tactics i.e. packaging, direct mail etc. People ● ● ● 1. 2. 3. 4. This refers to the labor involved, be it physical or mental. In order for a service to be provided, employees will need to be involved. e.g. Teachers in schools, Lawyers in law firms However, the delivery of the service must be effective in order for it to sell profitably and in order for it to attract customers. This appears in the form of the following: Appearance and body language (This could be in the form of uniform or outfit i.e. lawyers will appear in suits for a more professional outlook) Feedback (This analyzes how well customer service is. Feedback is necessary to help see how well the service is being presented. Customers can be asked to fill questionnaires, staff can help vote for ’employee of the month/year’ etc.) Aptitudes and Attitudes (An aptitude test figures outs the capability of the staff i.e. how good they are at their job. These tests can help the business figure out how attentive the staff are and whether they portray a strong positive attitude to the customers in terms of being polite, being happy, being respectful etc.) Efficiency Physical Environment (Also known as physical evidence) ● This refers to the tangible parts of a service for example, the out look of a hair cut (the fact that its shorter) or in a hotel, where your room is clean and tidy. ● Peripheral products can also be used to assist the quality of the overall service. These products are ”additional” or extra and only help to enhance the service. For example drinks in a hair salon. ● Measuring the quality of the physical environment is rather difficult though: 1. Mistakes (It’s much easier to spot the mistakes of a physical product. For example, a certain piece of equipment has broken down versus how well the service is provided 2. Productivity (Cannot be determined simply by output) 3. People Management (Since services are usually labour intensive, employing a large workforce is rather costly and difficult to manage especially because the expertise of an individual varies. Not all the staff are consistent.) Processes ● ● 1. 2. 3. The way in which a service is given, provided and delivered. (Not the same as place!) – Processes include: The way in which the item is payed for (i.e. cheque, cash, credit card) Customer Service (How attentive the staff are towards their customers.) After sales care (Gives the business a competitive edge [differentiation] i.e. technical support, warranties) 4. Waiting time (Poor waiting time could reduce the business image and lower customer satisfaction)