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The Marketing Mix. Maintaining the right marketing mix that satisfies the target market and creates long-term relationships with customers. Did You Know? Domino’s Pizza delivery drivers cover 9 million miles a week delivering 400 million pizzas a year. Product Strategy. Product development

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the marketing mix
The Marketing Mix
  • Maintaining the right marketing mix that satisfies the target market and creates long-term relationships with customers

Did You Know?

Domino’s Pizza delivery drivers cover 9 million miles a week delivering 400 million pizzas a year.

product strategy
Product Strategy
  • Product development
  • Classification
  • Mix
  • Life cycle
  • Identification
developing new products
Developing New Products
  • New Idea Screening
  • Business Analysis
  • Product Development
  • Test Marketing
  • Commercialization

Did You Know?

In 2001, Microsoft planned to spend $4 billion on R&D.

Source: Rebecca Buckman, “Window into the future,” Wall Street Journal, June 25, 2001, p. R19.

classifying products
Consumer Products

Convenience products

Shopping products

Specialty products

Business Products

Raw materials

Major equipment

Accessory equipment

Component parts

Processed materials

Industrial services

Classifying Products
product line and product mix
Product Line

Closely related products that are treated as a unit because of similar marketing strategy, production, or end-use considerations

Product Mix

All of the products offered by an organization

Product Line and Product Mix
colgate palmolive s product mix and product lines
Colgate-Palmolive’s Product Mix and Product Lines

Source: “Our Products,” Colgate-Palmolive (n.d.), (accessed June 5, 2004).

identifying products
Identifying Products
  • Branding
    • The process of naming and identifying products; can use a brand mark or trademark
  • Packaging
    • The external container that holds and describes the product
  • Labeling
    • The presentation of important information on a package
categories of brands
Categories of Brands
  • Manufacturer Brands
    • Kellogg’s, Ford, Sony
  • Private Distributor Brands
    • Kenmore appliances (Sears)
  • Generic Brands
    • peanut butter, dog food, kitty litter
packaging functions
Packaging Functions
  • Protection
  • Economy
  • Convenience
  • Promotion

Did You Know?

While shopping, the average time a consumer looks at a package is 2.5 seconds.

  • The content of labeling, often required by law, may include:
    • Ingredients or content
    • Nutrition facts (calories, fat, etc.)
    • Care instructions
    • Suggestions or use (such as recipes)
    • The manufacturer’s address and toll-free number
    • Web site
    • Other useful information
product quality
Product Quality
  • The degree to which a good, service, or idea meets the demands and requirements of customers
pricing strategy
Pricing Strategy
  • Four Common Pricing Objectives:
    • Maximize profits and sales
    • Boost market share
    • Maintain the status quo
    • Survival
pricing strategies
Pricing Strategies
  • New Product Pricing
    • Price skimming
    • Penetration pricing
  • Psychological Pricing
    • Odd/Even
    • Prestige pricing
  • Price Discounting
    • Quantity discounts
    • Seasonal discount
    • Promotional discounts
price vs non price competition
Price vs. Non-Price Competition
  • For the following products, indicate whether they are sold using price competition or non-price competition and defend your selection:
    • Toyota Hybrid Prius
    • Hyundai Sonata
    • Porsche Cayenne SUV
    • Estee Lauder Electric Intense Lipcreme
    • Avon Brilliant Moisture Lip Color
    • Louis Vuitton’s Murakami Handbags
    • Olay Complete Moisturizing Lotion
    • Toshiba Widescreen Televisions
distribution strategy
Distribution Strategy
  • Marketing Channels
    • Retailers (Wal-Mart, Sears)
    • Wholesalers (food brokers to restaurants)
    • E-tailers (
supply chain management
Supply Chain Management
  • Long-term partnerships among channel members to reduce costs, waste, and unnecessary movement through the channel to satisfy customers
channels for business products
Channels for Business Products
  • More than half of all business products are sold through direct marketing channels.
  • Other business products may be distributed through channels employing wholesaling intermediaries.
    • Industrial distributors
    • Manufacturer’s agents
intensity of market coverage
Intensity of Market Coverage
  • Intensive distribution
    • Makes a product available in as many outlets as possible
  • Selective distribution
    • Uses only a small proportion of all available outlets to expose products
  • Exclusive distribution
    • Exists when a manufacturer gives a middleman the sole right to sell a product in a defined geographic territory
physical distribution
Physical Distribution
  • Physical distribution includes all the activities necessary to move products from producers to customers.
    • Inventory control
    • Transportation
    • Warehousing
    • Materials handling
importance of distribution in a marketing strategy
Importance of Distribution in a Marketing Strategy
  • Distribution decisions are the least flexible marketing decisions.
    • Use committed resources
    • Establish contractual relationships
    • Are bound by time
the promotion mix
The Promotion Mix
  • A strong promotion program results from the careful selection and blending of:
    • Advertising
    • Personal selling
    • Publicity
    • Sales promotion
  • Integrated marketing communications
    • The process of coordinating the promotion mix elements and synchronizing promotion as a unified effort
  • A paid form of non-personal communication transmitted through a mass medium
    • Advertising campaign
advertising media
Print media



Direct mail

Outdoor (billboards)

Electronic media



Cyber ads

Advertising Media
internet advertising
Internet Advertising
  • Total revenues from internet advertising in the U.S. increased over 30 % between 2004 and 2005 and now totals over $12.5 billion.

Source: “IAB Internet Advertising Revenue Report,” PriceWaterhouseCoopers

and the Interactive Advertising Bureau, April 2006, p. 3.

top 10 product categories for advertising spending in the united states for the year 2003
Top 10 Product Categories for Advertising Spending in the United States for the year 2003

Source: “U.S. Advertising Spending Rose More than 5% in 2003, Nielson Media Research press release, February 19, 2004, available at

personal selling
Personal Selling
  • Direct, two-way communication with buyers and potential buyers
  • A six-step process:
    • Prospecting
    • Approaching
    • Presenting
    • Handling objections
    • Closing – asking for the order
    • Following up

Did You Know?

A typical sales call on an industrial customer can cost between $200 and $300 per call

  • Non-personal communication transmitted through mass media but not paid for directly by the firm
    • Presented in news story form
    • Describes what a firm is doing, what products it is launching, or other newsworthy information
sales promotion
Sales Promotion
  • Direct inducements offering added value or some other incentive for buyers to enter into an exchange
    • Store displays
    • Premiums
    • Sampling and demonstrations
    • Coupons
    • Consumer contests and sweepstakes
    • Refunds
    • Trade shows

Did You Know?

Annually, 248 billion cents-off coupons are distributed, but less than 2% are redeemed

objectives of promotions
Objectives of Promotions
  • Stimulate demand
  • Stabilize sales
  • Inform, remind, and reinforce customers
promotional positioning
Promotional Positioning
  • The use of promotion to create and maintain an image of a product in the buyer’s mind
  • A natural result of market segmentation
  • Assists in product differentiation
average salary for sales and marketing executives 2003
Average Salary for Sales and Marketing Executives, 2003

Source: Galea, Christine. “The 2004 compensation Survey,” Sales & Marketing Management, May 2004, table p.29.

solve the dilemma
Solve the Dilemma
  • Design a marketing strategy for the new product line.
  • Critique your marketing strategy in terms of its strengths and weaknesses.
  • What are your suggestions for implementation of the marketing strategy?
explore your career options
Explore Your Career Options
  • Do you think the role of marketing will continue to be important in the face of increasing technological advances?
    • Should professionals such as doctors, lawyers, and dentists utilize marketing in the same way that manufacturing and retail firms do?
additional discussion questions and exercises
Additional Discussion Questions and Exercises
  • Research and development is the process of identifying new ideas and technologies that can be developed into new products.
    • Where do these new ideas come from?
  • Assume you have the opportunity to buy a company that markets a product.
    • Which stage of the life cycle of that product would offer you the greatest opportunity for profits? Why?
additional discussion questions and exercises43
Additional Discussion Questions and Exercises
  • What is the difference between a “brand mark” and a “trademark”?
  • What are the advantages of businesses using coupons and/or contests and sweepstakes for sales promotion purposes?
chapter 13 quiz
Chapter 13 Quiz
  • In the introductory stage of a product’s life, buyers may be charged the highest possible price for the product. This pricing approach is called
    • penetrating pricing
    • psychological pricing
    • price skimming
    • break-even point
  • Branding may include:
    • the brand name
    • the brand mark
    • the trade mark
    • all of the above
chapter 13 quiz45
Chapter 13 Quiz
  • Products that are purchased after the consumer has compared competitive products are:
    • convenience products
    • shopping products
    • specialty products
    • a product line
  • Intermediaries who sell products to ultimate consumers for home and household use rather than for resale or for use in producing other products are:
    • wholesalers
    • retailers
    • merchant middlemen
    • agent middlemen
multiple choice questions about the video
Multiple Choice Questions about the Video
  • How much market share does Apple have of the digital music devices market?
    • 90%
    • 60%
    • 30%
    • 10%
  • Which of the following is not currently offered by Apple?
    • GarageBand
    • iMovies
    • iThing
    • iWeb