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Unit 3 - Marketing (continuing) - Coggle Diagram
Unit 3 - Marketing (continuing)
3.5.1 Branding
Brand
a promise of a value of a company
competency of managing the core values, image and structure of all the brands that a company owns.
allows consumers to create expectations of the product purchasing
Branding Aspects
awareness
ability of a consumer to know the existence of your brand
ability to distinguish its offerings from competitors
development
developing a brand in market
increasing brand power
value
intangible value of a brand adds to product being offered
loyalty
commitment of consumers to your brand
delivers higher perceived value
Brand Architecture
Unitary
one name for all
composite unitary
sub-categories of master brand
brand endorsement
parent brand endorses child brand
hybrid
mix of different styles
corporate invisibility
each brand operates on its own
3.6 Pricing
Price
refers to the money customers pay or give up for acquiring goods or services
generates revenue for a business
Markup Pricing
price is set based on an average upcharge to the cost
generally done in percentages
Advantages
It is a simple and quick method of calculating the selling price of a product
good way to ensure that a business covers its costs and makes a profit
Disadvantages
fails to consider market needs or customer value when setting prices
competitors prices aren't considered a firm could lose sales if it sets a selling price that is higher than its competitors'
Penetration Pricing
low initial price is set to attract customers quickly
skillfully gain more market share
Advantages
prices are low, consumers are encouraged to buy the products - leads to higher sales and market share
high sales volume can lead to decreases in the costs of production
Disadvantages
gaining high sales does not mean achieving high profits
customers may perceive the product to be of low quality if the price is kept low
only suitable for use in markets that are very price sensitive
Price Skimming
refers to setting a higher price when introducing a product to the market
seen as a good tradeoff due to the status that novelties bring to the market.
Advantages
consumers associate high price with high-quality products may enhance brand image
firms are able to obtain initial high revenues that help to recover their research
Disadvantages
high prices may discourage some consumers from buying products
Psychological Pricing
the price is set based on the perceived value that the average customer has in relation to the product
using a specific price to change the perception that consumers will have of your product.
Advantages
effects of selling at a slightly lower price can obtain larger revenues
it is a strategy that can be suitably applied in many market segments
Disadvantages
using prices such as, $9.99 may be inconvenient for some businesses that require whole numbers in their transactions
Loss Leader
the set price is either right at the average cost or below it.
create a large influx of buyers into the company.
Advantages
businesses selling larger number of purchased products may attract many customers
businesses may use promotional strategy to encourage consumers to switch to their brand
Disadvantages
may be accused by competitors of undercutting them by using unfair business practices
Price Discrimination
refers to selling the same product to different people at different prices.
season-based industries, where a higher price is set during peak seasons, or in the hotel industry
Advantages
benefit consumers and producers
peak times businesses charge high prices generating higher revenues
Disadvantages
extra cost of producing and selling more products doesn't exceed the extra revenue
Competitive Pricing
companies that sell similar products will use this strategy to sell their products for less than their competitors
aim of driving them out of the market.
Advantages
consumers benefit from the low prices
firms could gain higher sales revenue
Disadvantages
predatory pricing form of anti-competitive behavior and illegal in many countries
3.7 Promotion
All marketing efforts and actions that refer to the communication of information about a company's products to its customers
Examples of promotional objectives:
create awareness about a product
persuade consumers about a product
remind consumers of the existence of a product in order to stimulate re-uses and re-purchases
Enhance the brand image
Above the Line Promotion
ATL is a paid form of communication that uses independent mass media to promote a firm's products
advertising to reach a wide target audience
ATL ads strategies
Informative: focus is provide information in order to promote rational decisions
Persuasive: focus is to convince customers to buy your proud instead of your competitor's.
Reassuring: focus is to remind existing customers that they made the right choice in purchasing your product
Below the Line Promotion
BTL is a form of communication where the business has direct control over its promotional activities
Examples of BTL forms
Direct Marketing: comes in the form of direct mail, eliminating the use of intermediaries and sends the information right to the customer
Personal Selling: using sales representatives to make sales directly to consumers, using a personal touch.
Sales Promotion: composed of short-term incentives with the aim of boosting sales
Public Relations: promotional activities aimed at enhancing the image of the business and its products.
Social Media Marketing
harnesses the power of social networking services (SNS) in order to spread the reach of your intended messages.
Benefits of social media marketing:
wide reach
more engagement
constant and updates market information
cost savings
brand recognition
speed
Drawbacks of social media marketing
accessibility issues
distractions
Guerrilla Marketing
is a wide umbrella that takes into consideration all kinds of uncommon media and activities in order to spark attention.
benefits of guerrilla marketing
low costs
simplicity
proximity to target market
novelty
interaction
drawbacks of guerrilla marketing
ethics opportunity to go haywire