Chapter 12 — The Marketing Mix [Product]

1. The Marketing Mix.

- marketing mix = all the activities which go into marketing a product or service
- market research, branding, brand image, responding to customer demands
- each of the 4 Ps must be considered carefully so it all fits together
a) Product = good/service; its features, design, quality; packaging; competition
b) Price = comparison with competitors’ prices, high enough to cover production costs
c) Place = channels of distribution; shops; sold to wholesalers or public directly?
d) Promotion = advertisement; promotion; discounts; free gifts; money-off vouchers.

2. The role of product decisions in the marketing mix — types of product.

- consumer goods = goods bought by consumers for their own use; food, furniture…
- consumer services = services bought by consumers for their own use; hairdressing,
education…
- producer goods = goods produced for other businesses to use; trucks, machines…
- producer services = services produced to help other businesses; accounting, insurance…

• successful product:
i) satisfies the needs and wants of consumers, can stimulate new wants
ii) must be the right quality for the price (value-for-money)
iii) the costs of production must not be too high or else they won’t be covered easily
iv) must be designed carefully and in line with the brand image
v) has distinctive properties/the business is the first to produce such a good.

3. Product Development.

ideas → further research → predict sales → prototype → sample → test market → full launch

4. The Costs and Benefits of developing new products.

• benefits:
- Unique Selling Point = special feature of a product that differentiates it from the
competitors, making the business the first to launch that product and attract consumers
- diversification
- business can expand into new and existing markets.

• costs:
- costly to carry out market research and analyse the findings
- costly to make prototypes and trial products
- might be a lack of sales if the target market is wrong
- loss of company image if the new product fails to meet customer needs.

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 5. The importance of Brand Image.

- brand image = image or identity given to a a product which gives it a personality of its
own and distinguishes it from its competitors’ brands
- brand name = unique name of a product that distinguishes it from other brands
- brand loyalty = when consumers keep buying the same brand again and again instead of
choosing a competitor’s brand.
• branding:
- needs advertisement to reinforce the brand’s qualities
- higher quality than unbranded products
- always the same standard
- unique brand/name, unique packaging
- higher price than unbranded products
- creates a brand image and reputation
- encourages customers to keep buying (brand loyalty).

6. The Role of Packaging.

- packaging = physical container or wrapping for a product; also used for promotion and
selling appeal + carries vital information on the labels (often legally required)
- protects the product and is suitable for it
- easy to transport, open, and use the product
- eye-catching and promotes brand image.

7. The Product Life Cycle.

[ product developed → introduced to the market → sales grow rapidly → maturity

where sales grow slowly → saturation where sales stabilise at the highest point →
decline of sales ]
- product life cycle = stages a product will pass through from its introduction, through its
growth until it is mature, and then finally its decline; length depends on the product.

8. How stages of the product life cycle influence marketing decisions.

• pricing:
- beginning/growth stages = high price as the product is new and of good quality
- saturation/maturity stages = price is reduced so the sales don’t decline as much
- decline = price discounts
• promotion:
- more spent on promotion in the beginning, reduced in later stages, increased at decline
- extension strategy = way of keeping a product at the maturity stage to extend the cycle.

9. Extending the product life cycle.

- introduce new variations of the original product, make small changes on its design…
- sell into new markets and sell through additional/different retail outlets
- use a new advertising campaign
= the maturity phase will be prolonged.
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