The Marketing Mix: Product

The Marketing Mix

A term used to describe all the activities which go into marketing a product

The four Ps of the marketing mix

Product

Price

Place

Promotion

Design and Quality

The price at which the product is sold

Comparison with the prices of competitor's products

Price should, in the long run, cover costs

The channels of distribution that are selected

How the product is advertised and promoted

The Role of Product Decisions in the Marketing Mix

The product itself is probably the most important element in the marketing mix

Types of product

Some products are sold to consumers and some can be sold to other businesses

Consumer Goods

Goods which are consumed by people

Consumer Services

These are services that are produced for people

Producer Goods

These are goods that are produced for other businesses to use

They are bought to help with the production process.

Producer services

These are services that are produced to help other businesses

Promotion of a producer good will be quite different to promotion of a consumer good

Producing the right product at the rice price is an important part of the marketing mix

The product needs to satisfy consumer wants and needs, If it does not then it will not sell

The product also needs to be of the right quality so the price is what consumers are willing to pay

The costs of production must enable a price to be set that will produce a reasonable profit

Design of the product is very important

The product also needs to perform to a standard expected from it

Product Development

The process:

Generate Ideas

Select the best ideas for further research

Decide if the company will be able to sell enough

Develop a prototype

Launch the product in one part of the country to test the market

Full launch of the product to the whole market

The costs and benefits of developing new products

Benfits

USP (Unique Selling Point) will mean the business will be first into the market with the new product

Diversification for the business, therefore giving it a broader range of products to sell

It allows the business to expand into new markets

It may allow the business to expand into existing markets

Costs

The costs of carrying out market research and analysing the findings

The costs of producing trial products including the costs of wasted materials

Lack of sales if the target market is wrong

Loss of company image if the new product fails to meet customer needs

The Importance of Brand Image

Selling a product directly to the customer makes it easy to inform the customer of the products's qualities and good points

The sales person can persuade the customer to buy the product

It is the assurance of a standard quality that makes consumers confident in buying branded products

Businesses use brands for their products to encourage consumers to keep buying their products and not those of their competitors

Consumers may have brand loyalty, which means they will keep buing the same brand of a product instead of products from other brands

The Role of Packaging

It has to be suitable for the product to be put in

Packaging has to give protection to the product and now allow it to spoil.

It also has to allow the product to be used easily

It has to be suitable for transporting the products

Promoting the product

It has to appeal to the consumer, eyecatching

The brand image will be reinforced bu the packaging in which the product is sold

The labels on products sometimes have to carry vital information about the product

The Product Life Cycle

First a product will be developed

Then introduced or launches on to the market

Sales start to grow rapidly

Maturity

Sales now increase only slowly

Competition becomes intense and pricing strategies are now competitive

Sales have reached saturation point and stabilize at their highest point

Sales of the product will decline

New products come along

The product has lost its appeal

Advertising is reduced and the stopped

Extending the product life cycle

Introduce new variations of the originals product

Sell into new markets

Make small changes to the product's design

Use a new advertising campaign

Introduce a new improved version of the old product

Sell through additional, different retail outlets