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Continuous exposure to advertising and personal selling leads many people to link marketing
and selling, or to think that marketing activities start once goods and services have been
produced. While marketing certainly includes selling and advertising, it encompasses much
more. Marketing also involves analyzing consumer needs, securing information needed to
design and produce goods or services that match buyer expectations and creating and
maintaining relationships with customers and suppliers.
The following table summarizes the key differences between marketing and selling
concepts.
The American Marketing Association, the official organization for academic and
professional marketers, defines marketing as: Marketing is the process of planning and
executing the conception, pricing, promotion and distribution of ideas, goods and services to
create exchanges that satisfy individual and organizational objectives Another definition goes
as ‘ … process by which individuals and groups obtain what they need and want through
creating and exchanging products and value with others’. Simply put: Marketing is the
delivery of customer satisfaction at a profit.
Evolution of Marketing
In the production era, the production orientation dominated business philosophy. Indeed
business success was often defined solely in terms of production victories. The focus was on
production and distribution efficiency. The drive to achieve economies of 8 scale was
dominant. The goal was to make the product affordable and available to the buyers. In the
product era, the goal was to build a better mouse trap and it was assumed that buyers will
flock the seller who does it. However, a better mousetrap is no guarantee of success and
marketing history is full of miserable failures despite better mousetrap designs. Inventing the
greatest new product is not enough. That product must also solve a perceived marketplace
need. Otherwise, even the best-engineered. Highest quality product will fail. In the sales era,
firms attempted to match their output to the potential number of customers who would want
it. Firms assumed that customers will resist purchasing goods and services not deemed
essential and that the task of selling and advertising is to convince them to buy. But selling is
only one component of marketing. Next came the marketing era during which the company
focus shifted from products and sales to customers’ needs. The marketing concept, a crucial
change in management philosophy, can be explained best by the shift from a seller’s market –
one with a shortage of goods and services – to a buyer’s market – one with an abundance of
goods and services. The advent of a strong buyer’s market created the need for a customer
orientation. Companies had to market goods and services, not just produce them. This
realization has been identified as the emergence of the marketing concept. The keyword is
customer orientation. All facets of the organization must contribute first to assessing and then
to satisfying customer needs and wants. The relationship marketing era is a more recent one.
Organization’s carried the marketing era’s customer orientation one step further by focusing
on establishing and maintaining relationships with both customers and suppliers. This effort
represented a major shift from the traditional concept of marketing as a simple exchange
between buyer and seller. Relationship marketing, by contrast, involves long-term, value-
added relationships developed over time with customers and suppliers.
Marketing Framework
The basic elements of a marketing strategy consist of (1) the target market, and (2) the
marketing mix variables of product, price, place and promotion that combine to satisfy the
needs of the target market.
The product strategy involves deciding what goods and services the firm should offer to a
group of consumers and also making decisions about customer service, brand name,
packaging, labeling, product life cycles and new product development. The pricing strategy
deals with the methods of setting profitable and justifiable prices. Marketers develop place
(distribution) strategy to ensure that consumers find their products available in the proper
quantities at the right times and places. Place-related decisions involve the distribution
functions and marketing intermediaries (channel members). In the promotional strategy,
marketers blend together the various elements of promotion to communicate most effectively
with their target market.
Marketing Process
The marketing process can be divided in several different ways. One popular
conceptualization of marketing tasks is:
Strategy formulation – the development of the broadest marketing/business strategies with
the longest term impact
2. Marketing planning – the development of longer-term plans which have generally stronger
impact than the short-term programs
3. Marketing programming, allocating and budgeting – the development of short-term
programs which generally focus on integrated approaches for a given product and on the
allocation of scarce resources such as sales effort or product development time across various
products and functions
4. Marketing implementation – the actual task of getting the marketing job done
5. Monitoring and auditing – the review and analysis of programs, plans and strategies to
assess their success and to determine what changes must be made
6. Analysis and research – the deliberate and careful acquisition and examination of
qualitative and quantitative data to improve decision making.
Business Environments
Consumer Behaviour
Consumer behaviour is affected by many internal, personal factors, as well as interpersonal
ones. Each individual brings unique needs, motives, perceptions, attitudes, learning and self-
concepts to buying decisions. Marketers study consumer behaviour because it has serious
marketing implications – be it in marketing strategy (as defined by market segmentation,
targeting and positioning) formulation or in designing the marketing mix (defined by the 4 Ps
of marketing, viz., product, price, place and promotion).
Or
Market Targeting
After dividing the market into different segments next step is to choose one or more segment
to enter in the market. For this purpose marketer analyze the segment weather it is beneficial
for long run or not, this evaluation and selecting of segment is called targeting. Simple
definition of segmenting is “process of evaluating each market segment’s attractiveness and
selecting on or more segments to enter”. We can also say that targeting is actually cutting up
the market pie into different parts. Segmentation means that, instead of sending your message
to a crowded hall, a company should pitch their product to a group of attentive listeners in a
quiet room.
Market Positioning
Once the market is divided into smaller and more manageable categories, in the next step
companies carve out a position within each market segment. Positioning defines as “the
process by which marketers try to create or build an image (identity) of their products or
services in the mind of their targeted segment”. This mean determining the perception of
company’s product or service in the target segment or this is the way to understand that why
a customer should prefer your product or service instead of competitors. There are two type
of market positioning.
Re-positioning involves changing the identity of a company’s product or service relative to
competitors. This is called changing own product image.
De-positioning involves attempting to change the identity of competitor’s products or
services. This is called changing competitors product image.
Positioning strategies:
A company can position on -
1. Product attributes - eg Hyundai eg - positioned on low price 2
Benefits offered - eg Colgate toothpaste - reduces cavities, fights off decay 3.
Usage occasions - eg in summer - Gatorade
4.. Class of Users - Johnsons Baby shampoo - formerly used only on babies - now
position
to be used by all family members
5. Against a competitor-computers, technology products
6. Away from a competitor eg 7 Up as an Uncola drink
7. Different product class - some margarines are positioned against butter other margarines
are
positioned against cooking oils
8. Or their can be a combination of these
positioned against cooking oils
8. Or their can be a combination of these
A good way to understand the 4Ps is by the questions that you need to ask to define your
marketing mix. Here are some questions that will help you understand and define each of the
four elements:
Product/Service
What does the customer want from the product /service? What needs does it satisfy?
What features does it have to meet these needs?
Are there any features you've missed out?
Are you including costly features that the customer won't actually use?
How and where will the customer use it?
What does it look like? How will customers experience it?
What size(s), color(s), and so on, should it be?
What is it to be called?
How is it branded?
How is it differentiated versus your competitors?
What is the most it can cost to provide and still be sold sufficiently profitably? (See also
Price, below.)
Place
Where do buyers look for your product or service?
If they look in a store, what kind? A specialist boutique or in a supermarket, or both? Or
online? Or direct, via a catalog?
How can you access the right distribution channels?
Do you need to use a sales force? Or attend trade fairs? Or make online submissions? Or send
samples to catalog companies?
What do your competitors do, and how can you learn from that and/or differentiate?
Price
What is the value of the product or service to the buyer?
Are there established price points for products or services in this area?
Is the customer price sensitive? Will a small decrease in price gain you extra market share?
Or will a small increase be indiscernible, and so gain you extra profit margin?
What discounts should be offered to trade customers, or to other specific segments of your
market?
How will your price compare with your competitors?
Promotion
Where and when can you get your marketing messages across to your target market?
Will you reach your audience by advertising online, in the press, on TV, on radio, or on
billboards? By using direct marketing mailshots? Through PR? On the internet?
When is the best time to promote? Is there seasonality in the market? Are there any wider
environmental issues that suggest or dictate the timing of your market launch or subsequent
promotions?
How do your competitors do their promotions? And how does that influence your choice of
promotional activity?
Forever 21 CASE STUDY:
About Forever 21: Forever 21 is one of the most recognized fashion brands based out of
USA. One of the largest retailer chain of United States, Forever 21 was founded in year 1984.
It is famous for its youth oriented fashion and apparel products. The biggest competitor of
Forever 21 are: H&M, Zara, Gap Inc, URBN and J. Crew etc.
Marketing Mix of Forever 21 analyses the brand/company which covers 4Ps (Product, Price,
Place, Promotion) and explains the Forever 21 marketing strategy. The article elaborates the
pricing, advertising & distribution strategies used by the company.
Product:
The product strategy and mix in Forever 21 marketing strategy can be explained as follows:
Forever 21 is a popular fashion brand serving clothes for both men and women across various
age categories. Forever 21 has its presence globally with a diverse portfolio of products in its
marketing mix ranging from beauty products and accessories to apparel for girls, men and
women. The company caters adults, kids and even toddlers as its target customers. Some of
Forever 21’s products include-
Price:
Below is the pricing strategy in Forever 21 marketing strategy:
Forever 21 is known for its pricing strategies. It has a great deal reputation for meeting the
fashion demand of its customer at an economical price tag. The pricing strategy in its
marketing mix is that to compete in the aggressive industry. The response received by the
company from its customers speaks about the strategy of the company by itself. The numbers
are rising up as we speak. The end of financial year generated 3.7 billion revenues for the
company from its 480 stores which increased to 3.9 billion and reached 4.5 billion in the next
year. All the data shows that Forever 21 has become one of the coveted brand because of its
well thought of policies of making products pocket- friendly and qualitative as well.
Company also caters to its high- end consumers as well. The number of units sold by the
brand is highest in USA.
Place:
Following is the distribution strategy of Forever 21:
Started in Los Angeles, Forever 21 has spread its network in various countries around the
world. It has more than 600 retail stores across Asia, Europe, Middle-East, America and
Africa. The company has strategically established its huge outlets in the Countries like India,
Germany, Australia Japan, China, Brazil and United Kingdom. Forever 21also eyeing to go
to the countries like Israel, Malaysia, Costa Rica, Russia and Greece. The retail stores are at
least as large as Thirty Eight thousand Square-feet. On average 60 percent of the total
production for the company happens in manufacturing Plants located in China. Forever 21
has a substantially wide distribution channel and network around the globe. This network
consists of vendors, suppliers and franchise owners. Except a few locations like Middle-East,
the company has ownership of the business.
Promotion:
The promotional and advertising strategy in the Forever 21 marketing strategy is as follows:
Forever 21 uses all media channels to ensure it reaches all its customers. Promotional policies
are required to maximize the reach of the brand and to capitalize of market share. The
company since its inception has been an international organization which sold its products
globally. To lure customers from all around the world, Forever 21has been following multiple
promotional ideas. The rise of Social media has been a biggest plus for the company. With
the help of various social media platforms, like Facebook, Twitter, Pintrest, Instagram etc
company is spreading awareness among the masses by each passing day. The increasing
popularity can be measured by its increase in number of followers of the company’s official
social media pages. Conventional methods like Print and Digital media has been not dropped
as well. The company’s official website has been constantly upgrading to become more user
friendly to provide all the necessary information to the existing and potential customers.
Hence this completes the marketing mix of Forever 21.
MERCHANDISING: Merchandising is a specialized management functions within the
fashion industry. It is the business that moves the world fashion from designers showroom to
retail sales floor and in to the hands of consumers. It is the internal planning that takes place
within a retail organization in order ensures adequate amount of merchandise are on hand to
be sold at prices that the consumers are willing to pay to ensure a profitable operation.
TYPES OF MERCHANDISERS:
►►Fashion Merchandising:
Fashion merchandising is a rather broad term that can be used to describe the business side of
the fashion industry. Professionals with a fashion merchandising career must still have an eye
for style, but they should also have a head for business as well.This field involves buying,
pricing, marketing, displaying, and selling certain types of garments and accessories.A
fashion merchandiser may have several different duties.Most fashion merchandisers must be
able to predict future fashion and market trends. In order to do this, these professionals will
often need to rely on their own research as well as current trend reports.
Product development:
Product development is the business policy of the organization which includes the
development of the new designs and styles within the organization. This activity brings the
more business to organization, by showing pro-activeness in design development buyer also
impress. The role of production merchandiser in this activity plays very important role.
Production merchandiser must keep update to buyer time to time about the product
development done by organization. Motivate the buyer to give the design development to the
organization instead of doing themselves. Whenever buyer visits to the organization,
presentation of new colour, prints, embroidery patterns and desk loom developments is done
by production merchandiser. To present new designs developed by product development
department. Try to convince the buyer to select the designs from presentation. A very good
presentation and convincing ability of production merchandiser brings more business to the
organization.
Sampling
Sampling is one of the main processes in Garment manufacturing and it plays vital role in
attracting buyers and confirming the order, as the buyers generally places the order once
satisfied with the quality and responsiveness of the sampling. Sampling is the most crucial
and most important stage of fashion merchandising. Sampling department makes samples on
the basis of the specification and requirement by the buyer. Sampling in merchandising may
be defined as “The concept, perception and ideas of fashion designer developed into product
samples, in systematic stages of product development, with technical and quality clarity in a
development.” The role of merchandiser plays the crucial role as the follow up of the samples
is important aspect. Buyer passes some comments to the merchandiser after submitting the
sample. These comments are needed to understand and communicate with the sampling
department. Get changes from the sampling and resubmit to buyer. Follow up with buyer to
get approvals of the sample.
Costing
Costing is the very dynamic process, and it is the most important function performed by
merchandiser. Merchandiser should have knowledge of costing and it’s calculations. While
calculating the cost of the garment merchandiser keeps following things in mind.
• Fabric consumption
• Trims
• CMT
• Value added services: printing, embroidery, washing, applique
• Testing
• Transportation and logistics cost
• Profit of the manufacturing organization
• Currency exchange rate
The role of merchandiser does not end only after calculating the cost, but after quoting the
cost merchandiser need to negotiate with buyer on cost of the garment.
►►Objects of Merchandising :
Merchandising denotes all the planned activities to execute and dispatch the merchandise on
time, taking into consideration of the 4 Rs to replenish the customer.
►Right Cost: Everybody wants more from what they are paid.
►Right Time: No one wants to wait idle even in a Restaurant. Keeping delivery.
schedule is mandatory
Qualities of Merchandiser
►Loyalty: Loyalty is an essential character of human beings. Especially for the business
people like merchandiser it is a must.
►Knowledge about the field: Merchandiser should have adequate knowledge about the
garments, Computer knowledge, and technical knowledge to communicate with different
people in the business is a must.
►Co-ordinate & Co-operate: Merchandiser is the person who is actually co-ordinate with
the number of departments. To Co-ordinate with different people in the industry he should be
co- operative.
►Function of Merchandisers
1. Developing new samples, execute sample orders
2. Costing
3. Programming
4. Raw materials / Accessories arrangement
5. Production scheduling (or) route card drafting
6. Approval of various Process, Pattern and size set
7. Pre production follow up
8. Meet Inspection Agencies
9. Production controlling
10. Identifying shortages and make arrangement for the shortages
11. Following quality assurance procedures, quality control procedures
12. Monitoring the in-house, sub-contractors and junior activities
13. Buyer communication
14. Communication with sub-contractors, processing units & other 3rd parties
15. Proper reporting
16. Highlighting to the management
17. Record maintenance
18. Developing samples
19. Placement of orders to suppliers
20. Taking measures for consistent production
21. Taking preventive action to maintain the targeted performance in all areas of activities
22. Attending meeting with superiors and furnishing the required details about merchandising
Purchase order (PO) is received from the buyer which includes:
• PO no/date
• Buyer/Consignee
• Garment no
• measurement
• the description of the garment
• L/C date
• Last date within which shipment to be reach the destination.
• Sign and seal
•Order validity date
After receiving PO from the buyer merchandiser issues PO for the fabric unit, buttons, thread,
dyeing unit, printing, embroidery and other raw materials. These raw materials’ are checked
and color, quality and size approved by the merchandiser.
Responsibilities of a Merchandiser:
A mecrchadiser is responsible for the following tasks but not limited to these only.
Marketing
Costing and price quoting
Sample development and control whole sampling process
Fabric and accessories sourcing and tracking
Factory production scheduling and production tracking
Arranging final inspection
Shipping plan and booking
Customer liaison etc
Merchandising and interdepartmental relations:
In an export house or garment manufacturing unit, a merchant plays major role in order
execution. They need to interact with all the department in a factory. The major departments
in factory with whom merchants work closely is shown in the following diagram.