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The Marketing Mix - Coggle Diagram

- - - - 1) Individual Brands
        
        Product Brands
        
        These are brands associated with products e.g Marmite
        
        Pros of Product Branding
        
        Branded products can command higher prices than non-branded
        Businesses can expect higher profits from branded cash cows
        
        Good branding differentiates product and creates customer loyalty
        
        If one brand has a PR disaster, it doesn't affect the overall company
        
        Cons of Product Branding
        
        Product branding will require a very high investment
        
        Product branding may take many years to build up
        
        Limited flexibility when the product wants to develop beyond what they are known for
        
        Service Brands
        
        These are brands that add perceived value to services, they can be delivered face-to-face or online e.g Uber, Vue
      - 2) Umbrella ("Family") Brands
        
        This is a brand that is associated with more than 1 product e.g Cadbury
        
        This type of branding makes different product lines easily identifiable by the consumer by grouping them under one brand name
        
        Pros of Umbrella Branding
        
        Under one brand, advertising will promote multiple products simultaneously and this reduces advertising costs and enforces brand recognition
        
        Consumers familiar with one product under the umbrella are more likely to try others
        
        Cons of Umbrella Branding
        
        A single product failure or controversy can negatively impact the reputation of all products under the embrella
        
        Products may struggle to stand out individually
      - 3) Corporate Brands
        
        This is when the business promotes the brand name of a corporate entity instead of specific products e.g Nestle
        
        Pros of Corporate Brands
        
        Spreads the cost of marketing across all the individual brands
        
        Spreads awareness that the company can be worldwide (e.g Coca-Cola)
        
        Cons of Corporate Brands
        
        Any unfavourable incidents (e.g a product recall) causes the whole brand to suffer
        
        Too much advertising exposure can cause indifference towards the brand
      - 4) Own Label Brands
        
        This is an example of corporate branding where retail outlets assign their corporate branding to a range of goods and services (e.g Tesco's Finest, Essential Waitrose)
        
        Pros of Own Brand Products
        
        Boosts customer loyalty to the supermarket
        
        Fills gaps left by the competition
        
        Cons of Own Brand Products
        
        Quality is variable as products are often made by multiple different companies under the supermarkets name (e.g Tesco ketchup might be amazing, but Tesco corn flakes might be awful)
    - - Added value on the product
        
        A strong brand can add value to a product both for a consumer and a business
        
        This increases the value of the overall business and makes it look more attractive to investors
      - Ability to charge premium prices
        
        Consumers associate household names (e.g Hoover) with consistent high quality and therefore will pay a price higher than non branded
      - Reduced PED
        
        A well known brand will make the product more price inelastic, reducing the PED (e.g McVities Hobnobs can charge a higher price as you don't want to buy an inferior brand if you can afford)
    - - 1) USP's/ Differentiation
      - 2) Advertising
        
        Brand awareness is between customer and advertiser
        
        Customers purchase from brands they are familiar with
        
        Businesses need a mixed media approach (e.g use both print [newspapers] and digital [YouTube ads])
      - 3) Sponsorship
        
        Association with a celebrity or sports star can increase brand recognition, awareness, and perception
      - 4) Social Media
        
        A brand can engage with customers (followers) on social media channels
  - - - Online adverts can be targeted at customers who have shown an interest in a product by browsing for it. Digital communication is often cheaper than traditional forms of advertising.
- - - - The way a product works
      - If the product does what it needs to do
      - Products that emphasise function normally:
        
        Have a stable demand
        
        Have a longer product life cycle
        
        Have lower promotional costs
        
        Have a good reputation regarding reliability
    - - This is how the product appeals to the customer in terms of how it looks/feels etc
      - This is based on the subjective judgement of the customer
      - This is a very popular way to differentiate your product from the competition
      - Products that emphasise aesthetics normally:
        
        Have a high added value
        
        Potentially have a shorter product life cycle
        
        Demand is fuelled by customer aspiration
        
        Need greater promotional support
    - - Does the design allow the product to be made and sold profitably?
      - How much value is added during the production process?
      - Can the product be made efficiently and for a lower cost than competitors?
    - - Sustainability
        
        Making a product without affecting the long-term supplies of the inputs into the product
        
        Use inputs/materials that regenerate/grow (e.g wood replaces plastic)
        
        Source inputs that are not supplied by damaging environment
        
        Minimise waste in production
        
        Enable recycling or re-use
        
        Pros of Sustainability
        
        Higher demand
        
        Can charge a higher price
        
        Loyal customers
        
        Cons of Sustainability
        
        Costs increase
        
        Regulations - Less freedom in design
        
        Bad press could lead to long term reputation damage
      - Waste Minimisation
        
        Reduce packaging
        
        Reusable product and packaging
        
        Repairable - can get parts repaired/replaced without having to buy a completely new product
      - Ethical Sourcing
        
        Good examples:
        
        Fair trade - fair to the farmers
        
        No slavery (e.g Tony's chocolonely)
        
        Bad Examples:
        
        "Sweat shops" - Nike, Shein
        
        Child Labour
- - - - The business works out the costs for the product and then adds on the profit margin they want (Price = Costs + Profit Margin)
      - Pros of Cost Plus Pricing
        
        Easy to calculate
        
        Managers can be confident there will be a profit for each product
      - Cons of Cost Plus Pricing
        
        Doesn't acknowledge competition and their prices
        
        Sales are lost of price is too high for consumer
        
        Ignores PED
    - - The business charges a prices in line with its competitors, forcing the customers to judge based off non-price factors (e.g quality of service)
        
        This is used when products in a market are all very similar
      - Pros of Competitive Pricing
        
        If you trust your customer service is better (or at least as good) than competitors, why would the customers shop anywhere else?
      - Cons of Competitive Pricing
        
        Pricing at the same price as larger companies may not cover costs for small businesses with fewer sales
    - - This is used when launching a new product. The price is set high to start, to create high profits and to pay back the high research and development costs.
        
        Normally used in markets with few competitors
        
        As competitors enter the market or when all loyal customers have bought the product, the price decreases. This will win over the customers deciding between them and a competitor
      - Pros of Price Skimming
        
        A high starting price can establish an upmarket image of a premium product
        
        For innovative products it's a good way to harvest high profits from early buyers who want the latest thing and can pay a premium price for it
      - Cons of Price Skimming
        
        Cheap imitations of the product may appear on the market too soon and take sales away from the real product
        
        Risky strategy as customers may be put off from buying due to the high price
    - - Prices are set really low on a new product to encourage sales and to persuade customers to try it. If the customer likes the product, they will keep buying it, even if the business raises the price.
        
        Low prices should gain the business more market share (this is called market penetration)
        
        In a mass market, repeat purchases (e.g tea bags, biscuits) are called Fast Moving Consumer Goods (FMCGs)
      - Cons of Penetration Pricing
        
        Consumers may have bought even with a higher price to start (meaning the business lost themselves potential revenue)
        
        Expensive as it eats into profits by reducing revenue - Low profit margin - Longer to pay back startup costs
      - "Hook and Bait" Penetration Pricing
        
        Sell the product cheaply, then sell any replaceable parts (called consumable items) very expensive
        E.g sell a razor for cheap, but the replaceable razor blades very expensively
    - - When one existing firm in the market cuts its prices, so they are below the cost of production
        
        This causes competitors to either lose their customers or be forced into a price war that will see them making a loss.
        
        The firm will hope competitors will leave the industry, allowing them to re-raise prices, and profit maximise (without competition)
        
        Limit pricing is a similar strategy, but done to deter a new entrant from joining the industry (limit the profits and incentive to join a market)
      - NOTE: IS ILLEGAL IN SOME COUNTRIES
    - - -This means pricing a product at £1.99 instead of £2 because people read the 1 and treat the price lower than it actually is
        
        Some businesses consider pricing carefully as it is often an indicator of quality, if products or services are perceived to be "too cheap" by customers then the value will be lost