Marketing

Dr. Bukaza Chachage

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 Introduction
• Marketing strategy involves planning and
decision-making over the longer term, with the
aim of effectively selecting and pursuing
marketing opportunities and establishing a
competitive advantage.
• This requires an awareness of the external
trading environment and market trends, an
appreciation of organization’s capabilities
resource base, and the ability to develop
appropriate target market strategies.
ANALYSING COMPETITORS
 Competitive Advantage
• Michael Porter identified the three generic
routes to competitive advantage, which are:
1.Cost leadership
2.Differentiation
3.Focus
 Competitive Advantage
• Steps in analysing competitors
1.Identifying the company’s competitors
2.Determining competitors objectives
3.Identifying competitors strategies
4.Assessing the competitors’ strengths and
weaknesses
5.Estimating competitors’ reaction patterns
6.Selecting competitors to attack and avoid
 Competitive Advantage
• The five competitive forces determining
industry competition by Michael Porter
1.Rivalry among existing like-for-like players
2.The threat of new entrants
3.The threat of substitute products or services
as a solution to customers’ problems or needs.
4.The bargaining power of buyers
5.The bargaining power of suppliers
MARKETING MIX
 MARKETING MIX
• The marketing mix refers to the set of actions,
or tactics, that a company uses to promote its
brand or product in the market.
• The 4Ps make up a typical marketing mix -
Price, Product, Promotion and Place.
• However, nowadays, the marketing mix
increasingly includes several other Ps like
People, Process and Physical evidence.
 Marketing Mix
1. Product
The product is either a tangible good or an intangible
service that is seem to meet a specific customer need
or demand. All products follow a logical product life
cycle and it is vital for marketers to understand and
plan for the various stages and their unique
challenges. It is key to understand those problems
that the product is attempting to solve. The benefits
offered by the product and all its features need to be
understood and the unique selling proposition of the
product need to be studied. In addition, the potential
buyers of the product need to be identified and
understood.
 Marketing Mix
2. Price
Price covers the actual amount the end user is expected to pay
for a product. How a product is priced will directly affect how
it sells. This is linked to what the perceived value of the
product is to the customer rather than an objective costing of
the product on offer. If a product is priced higher or lower
than its perceived value, then it will not sell. This is why it is
imperative to understand how a customer sees what you are
selling. If there is a positive customer value, than a product
may be successfully priced higher than its objective monetary
value. Conversely, if a product has little value in the eyes of
the consumer, then it may need to be underpriced to sell.
Price may also be affected by distribution plans, value chain
costs and markups and how competitors price a rival product.
 Marketing Mix
3. Promotion
The marketing communication strategies and
techniques all fall under the promotion heading. These
may include advertising, sales promotions, special
offers and public relations. Whatever the channel used,
it is necessary for it to be suitable for the product, the
price and the end user it is being marketed to. It is
important to differentiate between marketing and
promotion. Promotion is just the communication
aspect of the entire marketing function.
 Marketing Mix
4. Place
Place or placement has to do with how the
product will be provided to the customer.
Distribution is a key element of placement. The
placement strategy will help assess what
channel is the most suited to a product. How a
product is accessed by the end user also needs
to complement the rest of the product strategy.
 Extended Marketing Mix
• The service marketing mix consist of 7 P’s which are:-
- Product
- Pricing
- Place
- Promotion
- People
- Process, and
- Physical evidence
 Extended Marketing Mix
• Simple said, the service marketing mix assumes the
service as a product itself.
• However, it adds 3 more P’s which are required for
optimum service delivery.
• The 7-Ps or Extended Marketing Mix of Booms and
Bitner is a Marketing Strategy tool that expands the
number of controllable variables from the four in the
original Marketing Mix Model to seven
 Extended Marketing Mix
1.Product
-The product in service marketing mix is intangible in nature.
-Like physical products such as a soap or a detergent, service
products cannot be measured.
-Tourism industry or the education industry can be an excellent
example.
-At the same time service products areheterogenous, perishable
and cannot be owned.
-The service product thus has to be designed with care.
 Extended Marketing Mix
2. Price
-Pricing in case of services is rather more difficult than
in case of goods.
- If you were a restaurant owner, you can price people
only for the food you are serving.
-But then who will pay for the nice ambience you have
built up for your customers? Who will pay for the band
you have for music
 Extended Marketing Mix
3.Place
-Place in case of services determine where is the service product
going to be located.
-The best place to open up a petrol pump is on the highway or in
the city.
-A place where there is minimum traffic is a wrong location to
start a petrol pump.
- Similarly a software company will be better placed in a business
hub with a lot of companies nearby rather than being placed in a
town or rural area.
 Extended Marketing Mix
4. Promotion
-Promotions have become a critical factor in the service
marketing mix. Services are easy to be duplicated and
hence it is generally the brand which sets a service
apart from its counterpart.
-You will find a lot of banks and telecom companies
promoting themselves rigorously.
 Extended Marketing Mix
5.People
-People is one of the elements of service marketing
mix. People define a service.
-If you have an IT company, your software engineers
define you.
-If you have a restaurant, your chef and service staff
defines you.
- If you are into banking, employees in your branch and
their behavior towards customers defines you.
 Extended Marketing Mix
People cont…
- In case of service marketing, people can make or
break an organization. Thus many companies
nowadays are involved into specially getting their
staff trained in interpersonal skills and customer
service with a focus towards customer satisfaction.
- In fact many companies have to undergo
accreditation to show that their staff is better than
the rest
 Extended Marketing Mix
6. Process
Service process is the way in which a service is delivered to
the end customer. Lets take the example of two very good
companies – Mcdonalds and Fedex. Both the companies
thrive on their quick service and the reason they can do
that is their confidence on their processes. On top of it, the
demand of these services is such that they have to deliver
optimally without a loss in quality. Thus the process of a
service company in delivering its product is of utmost
importance. It is also a critical component in the service
blueprint, wherein before establishing the service, the
company defines exactly what should be the process of the
service product reaching the end customer.
 Extended Marketing Mix
7. Physical Evidence
-The last element in the service marketing mix is a very
important element.
- As said before, services are intangible in nature.
However, to create a better customer experience
tangible elements are also delivered with the service.
 Extended Marketing Mix
Physical Evidence Cont..
- Take an example of a restaurant which has only chairs
and tables and good food, or a restaurant which has
ambient lighting, nice music along with good seating
arrangement and this also serves good food. Which
one will you prefer? The one with the nice ambience.
That’s physical evidence. Several times, physical
evidence is used as a differentiator in service
marketing. Imagine a private hospital and a
government hospital. A private hospital will have plush
offices and well dressed staff. Same cannot be said for
a government hospital. Thus physical evidence acts as
a differentiator.
 Extended Marketing Mix
Physical evidence cont...
• The environment in which the service is
delivered and where the firm and customer
interact. Any tangible components that
facilitate performance or communication of
the service.
• ‘Tangible’ representation of the service such
as brochures, letterheads, business cards,
signage, equipment.
Thanks

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