Ch 15 Managing the Marketing Mix; 4P's

10 B2C Sales Promo Techniques

*see figure 15.12; B2C Sales Promo Techs 1. Coupons 2. Deals 3. Premiums 4. Contests 5. Sweepstakes 6. Samples 7. Loyalty Programs 8. Point of Purchase displays (product visibility) 9. Rebates 10. Product placement

9 Types of Retail Stores

*see figure 15.5; Types of Retail Stores 1. Department stores (ex. the Bay) 2. Discount stores (ex. Giant tiger, dollar store) 3. Supermkt (ex. metro, sobeys) 4. Warehouse club (ex. costco, wholesale) 5. Connivence store (ex. Mac's) 6. Category killer (Niche; Indigo, Sleep country Canada, Staples) 7. outlet store (Nike, Rockport) 8. Specialty store (jewellery stores, shoe stores) 9. Supercentre (Loblaws, Walmart)

The Promotion Mix Push and Pull Strategy Integrated Marketing Communication (IMC)

-each target group needs diff promo mix, they are COMBINED for max impact 1. Push strategy: -targets WHOLESALERS & RETAILERS -aim to "push" products through CofD to consumer 2. Pull strategy: -targets consumers -aim has consumer demand "pull" product through CofD (customers request retailers to sell certain products) Integrated Marketing Communication (IMC): -combines ALL promo tools into 1 UNIFED promo strategy ensures a delivery that is: -clear -consistent -compelling message -about the firm & its product

Product Development and Total Product Offer

-intense competition forces companies to constantly develop NEW products -total PRODUCT OFFER/VALUE PACKAGE; everything customer evaluates when deciding to what buy -inc; tangible & intangible like packaging, store appearance, delivery, past experience, brand image, name, reputation etc *see figure on Types of consumer Goods

Pricing Objectives Product consideration for Pricing Strategy

-mktrs spend a lot of time & money to find perfect prices that isn't always right -GOAL; inc sales & profit -price & cost NOT always related Each product requires own pricing strategy: 1. achieve target ROI 2. build traffic 3. achieve greater mkt share 4. create an image 5. further social objectives

Nonprice Competition

-price competition: leads to LOW price -non price competition: based on QUALITY and SERVICE & globalization; -adds value -educate consumers -establish relationships -price changes are EASY to match

Importance of Promotion The Promotional Mix (5)

-promotion attempts to engage potential customers in an info exchange *see figure on Promotional Mix 1. Advertising Mass vs Customized: mass payment: pay for space & time Strengths: reach LOTS of ppl Weaknesses: high costs, less contact 2. Personal selling: Mass vs Customized: customized payment: sales ppl commission Strengths: more control, persuasive Weaknesses: expensive 3. Public Relations: Mass vs Customized: mass payment: NO PAYMENT Strengths: credible info Weaknesses: diff media cooperation *adv (non personal) PAID for vs Publicity NOT PAID for form of promo 4. Sales Promotions: Mass vs Customized: mass payment: range of fees paid Strengths: change behaviour in SR Weaknesses: lead to promo wars, easy duplication 5. Direct Marketing: Mass vs Customized: customized payment: cost comm (mail, phone etc) Strengths: quickly, direct relations Weaknesses: declining customer response, expensive

Brand Name Selection

-suggest product benefits & qualities -easy to PRONOUNCE & remember, translate -simple, distinctive -protected legally

9 profit Pricing Approaches

1. Cost based Pricing: -producers set price based on PROFIT MARGIN desired 2. Demand based Pricing: -designing product that SATISFIES customers & meets profit margins desired by firm (ex. target costing) 3. Competition based Pricing: -setting a price AT, ABOVE, or BELOW competitor's prices 4. Break Even analysis: -process used to det PROFITABILITY at various levels of sales, consider fixed & variable costs 5. Surge Pricing: -prices inc w/ demand 6. Break Even Point -Break even point (BEP): quantity where total rev & total costs are EQUAL and $ beyond is PROFIT BEP= FC / (UNIT PRICE -UVC) ex. • Helen is adding greeting cards in her bookstore. Her fixed costs would be $300. Variable costs per card are $1 each. The greeting cards will sell for $2 each. Answer: _300/($2-$1)_=_300_ Helen's breakeven point would occur at 300 cards sold. (301 units sold will yield PROFIT) 7. Everyday low pricing (EDLP): -setting prices LOWER than competitors & NOT having special sales 8. High low pricing: -setting prices HIGHER than EDLP stores, but have MANY SPECIAL sales where prices will be lower than competitiors 9. Psychological pricing: -pricing products at price pts APPEARING less expensive ex. $99.99

Non Store Retailing (4)

1. Electronic Retailing 2. Telemarketing 3. Vending machine, Kiosks & carts 4. Direct selling

2 Pricing Strategies for New Products

1. Penetration Pricing: -low INITIAL price -win many buyers & large mkt share quickly useful for: -mkt is price SENSITIVE -potential scale economies 2. Skimming Pricing: -"market plus" approach, showing HIGH price rel to prices of competing products -USP enables higher price and inc WILLINGNESS TO buy -will then lower price to attract larger share -CPI tracks price inc

4 Other Promotional Tools

1. Word of Mouth (WOM) 1. Buzz marketing (popularity by consumer WOM) 2. Viral marketing (WOM online) 3. Guerilla marketing (low cost unconventional means) 2. Blogging 3. Podcasting 4. Mobile Media

Retail Distribution (3 Mkt Coverage Strategies)

3 Retail Distribution Strategies 1. Intensive Distribution (connivence goods): -stock MAX amnt of goods -MAX brand exposure/ saturation 2. Exclusive Distribution (speciality goods): -LIMITED # of dealers, exclusive rights -Ex. Fine China, Harley Davidson motorcycles 3. Selective Distribution (shopping goods): -use only a portion of avail outlets -good mkt coverage -more control, less cost vs intensive

Traditional S-Shape Product Life Cycle (PLC) 4 stages

4 Stages in Product Life Cycle 1. Introduction 2. growth 3. maturity 4. decline Impacts: -progress @ diff rates -magnitude btwn sles & profits vary @ each stage depending on: cost, price, demand -managers SWOT analysis and strategies impacts PLC *see figure 15.2; Stages of PLC Intro stage: Competition: few Product: one Price: skim/penetration Place (distribution): limited Promotion: inform, educate Growth stage: Competition: more Product: more versions Price: gain mkt share, deal Place (distribution): more outlets Promotion: stress pts of diff Maturity stage: Competition: many Product: full product line Price: defend mkt share, profit Place (distribution): max outlets Promotion: REMINDER orientated Decline Stage: Competition: reduced Product: best sellers Price: stay profitable Place (distribution): fewer outlets Promotion: min promo

Personal Selling

B2C Business to Consumer Sales process *see figure 15.11 B2C sales process 1. Approach 2. Ask Q's (MOST IMPORTANT TO RETAIN customers) 3. Make presentation 4. Close sale (IMPORTANT) 5. Follow up

Brand Equity

Brand Equity: -have the ability to create significant economic VALUE for businesses they serve & stakeholders -strong brands develop strong g/s: -command premium prices -attract best talent -reward investors -fare better in economic downturns -support communities & install pride *see figure Canada's Top Brands 2018 (mostly BANKS & TECH) 1. RBC 2. TD 3. Bell 4. Scotiabank 5. BMO 6. Rogers 7. Telus

Role of Distribution; Marketing Channels Channel Members 2 Channel Levels

Marketing channels (channel of distribution): -business structure of indep org reaching pt of product origin to CONSUMER w/ purpose of moving products to their final consumption Channel Members: -intermediaries, resellers, middlemen -negotiate w/ one another, buy & sell products & facilitate change of ownership btwn buyer & seller in course of moving product from MANUFACTURER to CONSUMER 2 Channel Levels: 1. Direct marketing channel: -producer TO user -better control of quality and price, closer ties w/ consumers -no intermediaries 2. Indirect marketing channels: -selling through 1+ intermediaries -more levels inc customer contact -fewer levels -more control & less complex

Packaging (5th P) 7 Functions

Packaging: -all activities of DESIGNING & PRODUCING container for product 7 functions: 1. attract buyer's attention 2. protect good inside & standing up under handling & storage 3. Ease of operating & use 4. describe & give info about contents 5. explain benefits of good inside 6. provide info on WARRANTIES, earnings etc 7. giving indication of price, value & uses

Supply Chain and Distribution Channels Agents/Brokers Social Commerce Mode of transport

Supply Chain (ALL): 1. Supplier's plants Channels of distribution: 2. Manufacturers 3. Wholesalers 4. Retailers 5. Consumers Agent/Brokers: mkting intermediaries bringing buyers & sellers together & assist in negotiating, DO NOT take TITTLE of g/s Social commerce: -form of electronic commerce that involves using social media to buy & sell Mode of transport: -transporting goods by truck, plane, ship, pipeline