Advace Fashoin Marketing

8/3/2019 Advace Fashoin Marketing

1/61

Marketing

Marketing is a social and managerial process whereby individuals and groups

obtain what they need and want through creating and exchanging products andvalue with others.

Marketing is the business process by which products are match with the markets andthrough which transfers of ownership are effected.

Marketing may be defined as an economic process by which goods and services are

exchanged and the values is determined in terms of money prices.

The American Marketing Association has defined Marketing As the performance of businessactivities that direct the flow of goods and services through producers to consumers or users.


2/61

Marketing concepts

The Marketing concepts may be defined as a management orientation that holds that the key task

of the organization is to determine the needs, wants, and values of a Targeted market and to adaptthe organization to delivering the desired satisfactions more effectively and efficiently than itscompetitors.

Marketing concept is a philosophy, an attitude, or a course of business thinking. It holds thatsatisfaction of the wants of the consumer is the economic and social justification of a companys

existence.

Marketing concepts is based upon three fundamental beliefs.

1. All companys planning , policies, and operations should be customers oriented.

2. Profitable sales volume should be the goal of the Company.

3. All Marketing activities should be organizationally integrated and co ordinated.


3/61

Core Marketing concepts

NEEDS , WANTS, AND

DEMANDS

Markets

Exchange,

Transactions, and

relationships

Value and satisfactionMarketing offers

(product, services,

experience)


4/61

Needs, wants, Demands

Need :- Human needs are states of felt deprivation.

Want:- The form taken by a human needs as shaped by a culture and individual personality.for example a Man needs food but wants to have chicken Mc grill burger with soft drink.

Demands:- Human wants that are backed by buying power . People demand products withbenefits that add up to the most value and satisfaction.

Market offer:- Some combinations of product s , services, information or experiences offeredto a market to satisfy a need or want.

Consumer value:- It is the difference between the values the consumer gain from owning andusing a product and the cost of obtaining the product.

Consumer satisfactions:- It is depends upon how well the purchase product s performancelives up to the consumers expectations.

Exchange :- The act of obtaining a desired object from someone by offering something in return.

Market :- The set of all actual and potential buyers of a product or service.


5/61

Maslow hierarchy of Human needs

Biological and physiological Needs

( Basic life needs, Air, Food, drink , shelter , sleep etc.)

Safety Needs

( Security, stability, protection, etc.)

Belongingness and Love Needs

( Family, Affection , Relationship etc.)

Esteem Needs(Achievement , status , dignity, recognition)

Need for self-actualization

(Personal growth & fulfillment

Levelofinco

me


6/61

Elements of a modern marketing system

Manufacturer

Exporter

Company

(marketer)

Rivals

Marketing

intermediaries

(Whole-sellers ,Retailers )

End

users

Environment


7/61

Marketing Managements

Marketing Management as the art and science of choosing target markets and building profitablerelationship with them. This involves getting , keeping, and Growing customers through creating,delivering and communicating superior customer value.

Marketing Management deals with planning, organizing, directing and controlling theActivities related to the marketing of goods and services to satisfy the customers needs.


8/61

Marketing functions

Functions ofR & D

Functions of

exchangeFunctions of

Physical treatmentMiscellaneousFunctions

1. Marketing research2. Product planning and

development

1. Buying and

Assembling.2. Selling

1. Standardization,grading, & branding.

2. Packaging3. Storing4. Transportation

1. Promotion

(advertisement,publicity).2. Pricing3. Financing4. Risk-taking


9/61

Factory Existing products Selling and promotion Profits

through sale

Starting Point Existing products Means Ends

The Selling Point

Market Customer needs Integrated Marketing Profits through

customer satisfaction

The Marketing Concept

Selling and Marketing concepts


10/61

Marketing Mix

Marketing Mix is the term used to describe the combination of the four inputs which Constitute the

core of a companys marketing system, the Product, Price- structure, promotional activities andthe distribution system.

Every business firm has to determine its Marketing Mix for the satisfaction of needs of thecustomers. Marketing Mix represents a blending of decisions in four areas-

1. Product2. Price3. Place4. Promotion

These four elements of Marketing mix are inter-related in such a way that decisions taken inone area usually affect actions in others. It is a dynamic state of affairs of the marketing system ofa business firm. It concentrates on how to satisfy the needs of the customers, If the needs of theconsumers change, the Marketing Mix will also be changed.


11/61

Customer

Component of Marketing Mix


12/61

Product :-

In the production of a product (or service) the marketing manager should reckon the fact that his

product indeed satisfies a need of the society. Product component of Marketing Mix involves planning, developing, and producing the right type of products and services to be marketed by the businessfirm.

It should also emphasis on its proper Branding, packing, colors, and other features. In other wordsproduction planning and development involves decision about .

Quality of the product Size of the product Design of the product Volume of the production Product range Branding Packaging Warranties and after sale services Product testing etc.


13/61

Price:-

Another important component of Marketing Mix is the pricing of the product . A marketing managerhas to do a lot of exercise to determine the price, he decide the price in such a way that the firm isable to sell its products successfully.

Pricing also involves establishing policies regarding credit and Discount.Below are other variables which considered while pricing a product ( or Service)

Demand for the product. Actual cost of the product Potential competition Government rules and regulations.

Pricing decisions and policies have direct influence on the sales volume and the profit of the firm.

Therefore right price can be determined through pricing research and by adopting test marketingtechniques.


14/61

Promotion:-

Promotion deals with informing and persuading the consumer regarding the firms productIt involves decisions about advertising , procedure of giving free articles for purchase of the particularcommodities, conducting contest, role of personal selling by the salesman, and other salestechniques.

Advertising is a tool marketing manager uses to communicate a message to consumers through

newspaper, magazines, televisions etc.

Personal selling is another means of communicating to the consumer , and consist of direct person toperson interaction between salesman and consumer.


15/61

Physical distribution:-

This aspect of Marketing Mix includes decisions about wholesale and retail channels of

distribution and the place at which the products should be displayed and made available to theconsumers.

It is managements responsibility and to select and manage trade channels through which theproduct will reach the right customer at the right time and to develop a physical distributionsystem for handling and transporting the products through these channels.


16/61

Marketing philosophies:-

As marketing management carrying out task to build profitable relationship with target consumers,

what philosophy should guide these marketing efforts ? There are five alternative concepts underwhich organizations conduct their marketing activities. The production The product The selling The marketing

The social marketing

The production concepts:-

The production concept holds that consumers will favor products that are availableand highly affordable. Thus the management should focus on improving production

and distribution efficiency . It is useful philosophy in two type of situations.

(a) when the demand of the product is higher than its supply.

(b) when the products cost is too higher and improved productivity is needed to bring

it down. (Henry Ford )


17/61

The product concept:-

The product concept holds that consumer will favor products that offer the most in quality

, performance and features that the organization should therefore devote its energy tomake continuous product improvements.

Selling concepts:-

The selling concepts which hold that consumers will not buy enough of the firms product

unless it undertakes a large scale selling and promotion efforts. Most firms practice theselling concept when they face over capacity , their aim is to sell what they make ratherthan make what market wants. This concept is typically practiced with unsought goodsand services like insurance etc.

The social Marketing concepts :-

The social marketing concepts holds that the organization should determine the needs ,wants, and interest of the target market and deliver the desired satisfaction moreeffectively and efficiently than do competitors in a way that maintains or improves theconsumers and societys well being.


18/61

Market segmentation

As a business firm can not appeal to all the buyers in the market, as buyers are too numerous ,too widely scattered , and too varied in their buying and practices. Moreover , the companies

themselves vary widely in their abilities to serve different segment of the market , rather try tocompete in an entire market, sometimes against superior competitors , each company mustidentify the parts of the market that it can serve best and most profitably.

Market segmentation :-

Dividing a market into smaller groups of buyers with distinct needs , characteristics , orbehavior who might require separate products or marketing mix. The company identifiesdifferent ways to segment the market and develop profiles of the resulting marketingsegments.

Target Marketing :-

The process of evaluating each market segments attractiveness and selecting one or more ofthe market segments to enter.

Market positioning :-

Arranging for a product to occupy a clear ,distinctive and desirable place relative to competingproducts in the mind of the target consumer.


19/61

Market segmentation1. Identify bases for

segmenting the market.

2. Develop segment

profiles.

Target Marketing3. Develop measure of

segment attractiveness .

4. Select target segments .

Market Positioning5. Develop positioning for

target segments.

6. Develop a marketing mix

for each segment.

Steps in market segmentation, Targeting, and positioning


20/61

Segmenting consumer market

Followings are the major variables that might be used in segmenting consumer market.

1. Geographic segmentation.2. Demographic segmentation.3. Psychographic segmentation.4. Behavioral segmentation.

Geographic segmentation :-

Dividing a market into different geographical units such as nations, states , regions, cities, orneighborhoods. A company may decide to operate in one or a few geographical areas, or tooperate in all the areas but pay attention to geographical differences in need and want.

Demographic segmentation :-Dividing the market into groups based on demographic variables such as

1. Age, ...under 6, 6-11, 12-19, 20-34, etc.2. Gender, .............Male , Female.3. Family size.1-2, 3-4, 5+4. Family life cycle .young, single, young married, no child, married with child.5. Income under $ 10000, $10000-$25000, $ 25000-$50000, $50000-100000. etc6. Occupation..professional, officials, home-makers, unemployed etc.


21/61

7. Education :- primary , secondary, sr. secondary, collage.

8. Religion :- ...catholic, protestant, Hindu, Muslim , Buddhist.

9. Generation:-.Gen x, gen y .

10. NationalityAmerica, UK, Europe, Japan, Australia.

Psychographic segmentation:-Dividing a market into different groups based on social class, Lifestyle, or personality

characteristics. People in the same demographic group can have very different

psychographic make-up.

1. Social class:-- lower-lower, lower-middle, middle-upper, lower upper, upper -Upper.

2. Lifestyle:------ Achievers, strivers, strugglers.3. Personality:--- compulsive, ambitious.

Behavioral segmentation:-Dividing a market into groups based on consumer knowledge, attitude, use, or response to

A product.

1. Occasions ;---------Regular, special occasion.2. User status:---------non-user, ex-user, potential user, regular user.

3. User rates:-----------light user, medium user, heavy user.

4. Loyalty status:------none, medium, strong, absolute.

5. Attitude towards product:- enthusiastic, positive, indifferent, negative.


22/61

Inter-market segmentation :-

Forming segments of consumers who have similar needs and buying behavior even though they

are located in different countries. For example , Mercedes-Benz target the worlds well to do,MTV targets the teenagers. Coke, Pepsi, UCB , Nike, Adidas are the few companies thatactively target world teens.


23/61

Target Marketing

Market segmentation reveals the firms market segment opportunities. Now firm has to evaluate

the various segments and decide how many and which ones to target.

Evaluating marketing segments- in evaluating different marketing segments, a firm must look atthree factors.1. Segment size and growth.2. Segment structural attractiveness.

3. Companys objectives and resources.

Segment size and growth :-The company must first collect and analyze data on current segment sale , growth rates, andexpected Profitability for various segments. It will be interesting in segment that have the rightsize and growth characteristics.

Segment structural attractiveness :-The company also needs to examine major structural factors that affect long run segmentattractiveness. For example a segment is less attractive if it is already contain many strong andaggressive competitors. ( Rivals ). Existence of actual or potential substitute products, strongbuyers power ( strong bargaining power, )


24/61

Companys objective and resources:-Even if a segment has the right size and growth and structurally attractive , the companyMust consider its own objectives and resources in relation to that segment.

Selecting target market segments:-After evaluating different market segments , the company must now decide which and how manysegments it will target. A Target market consist of a set of buyers who share common needs or

characteristics that company decide to serve.

Target marketing strategies

Undifferentiated

(Mass Marketing)

Differentiated( segmented

market)

Concentrated

( niche ) marketing

Micro marketing( Local or

individualmarketing)

Targeting broadly Targeting narrowly


25/61

Undifferentiated (Mass ) marketing:-A market coverage strategy in which a firm decides to ignore market segment differences and goafter the whole market with one offer. This mass marketing strategy focuses on what is common in

the needs of the consumers rather than on what is different. Company design a product and amarketing program that will appeal to the large number of buyers. It relies on mass distributionand mass advertising.

Differentiated marketing:-

A market coverage strategy in which a firm decide to target several market segments and designseparate offers for each. For example Nike offers athletic shoes for a dozen or more differentsports , from running, fencing, golf, bicycling to baseball. And American express offers not only itstraditional green cards but also gold cards, corporate cards, or even a black card called thecenturion.

Concentrated ( niche) marketing :-

A marketing- coverage strategy in which a firm goes after a large share of one or a few segmentsor niches. A niche marketing is especially appealing when company resources are limited. Forexample tetra sells 80% of the worlds tropical fish food, and steiner optical captures 80% of themilitarys binocular markets.


26/61

In niche marketing segments are fairly large and normally attracts several competitors,niches are smaller and may attract only one or few competitors, company achieves astrong position because of its greater knowledge of consumer needs in the niches it serves

and the special reputation it acquires.

Concentrated marketing can be highly profitable . It involves higher than normal risk .Companies that rely on one or few segments for all their business if that segments tunedsour.

Micro marketing :-The practice of tailoring products and marketing programs to the needs and wants of thespecific individuals and local consumer groups ---------include local marketing and individualmarketing.


27/61

Positioning for competitive advantage

After selecting and deciding which segments of the market it will target , the company mustdecide what positions it wants to occupy in those segments. A product s position is theway the product is defined by the consumers on important attributes----the place the productoccupies in the consumer s minds relative to competing products.Positioning involves implanting the brands unique benefits and differentiation in customersmind.For example TIDE is positioned as a powerful, all purpose family detergent ; Ivory snow ispositioned as the gentle detergent for fine washable and baby clothes.

To simplify the buying process, consumer organize products, services, and companies intocategories and position them in their minds. A products position is the complex set of perceptions, impression, and feelings that consumers have for the product compared withcompeting products.


28/61

Choosing a positioning strategy:-

The positioning consist three steps:-

1. Identifying a set of possible competitive advantages upon which to build a position.

2. Choosing the right competitive advantages.

3. Selecting an overall positioning strategy.

Competitive advantages:-

An advantage over competitors gained by offering consumer greater value, either

through lower prices or by providing more benefits that justify higher prices.

Thus positioning begins with actually differentiating the company s marketing offerso that it will give more value that competitors offers do.

Companies can differentiate their products on such attributes as consistency,

durability, reliability, or reparability.

Product differentiation with its services differentiation i.e. speedy, convenient, or

careful delivery, customer training, consulting services, advising services etc.

Choosing the right competitive advantages:-

A company has to choose the ones ( differentiations) on which it will build its

positioning strategy. It must decide how many differences to promote and which

ones.


29/61

1. How many differences to promote ? One or two or more.

2. Which differences to promote ? The company must carefully select the ways in which

it will distinguish itself from competitors.

Important :- the differences delivers a highly valued benefit to target buyers.

Distinctive:- competitors do not offer the difference, or the company can offer it in amore distinctive way.

Superior: - the difference is superior to other ways that consumer might obtain thesame benefit .

Communicable :- the difference is communicable and visible to the buyers.

Preemptive:- competitors cannot easily copy the difference.

Affordable: - buyers can afford to pay for the difference.

Profitable:- the company can introduce the difference profitability.


30/61

Selecting an overall positioning strategy:-

Consumers typically choose products and services that give them the greatest value.

Thus marketers want to position their brand on the key benefits that they offer relative tocompeting brands. The full positioning of a brand is called the brands valueproposition---- the full mix of benefits upon which the brand is positioned.It is the answer to the consumer question why should I buy your brand ?

Developing a positioning statement:-A statement that summarizes company or brand positioning --- it takes this form:

To ( target segment and need ) our ( brand) is (concept) that ( point of difference)


31/61

Perceptual Mapping

Marketing research technique in which consumers views about a product are traced or

plotted (mapped) on a chart. Respondents are asked questions about their experience with the

product in terms of Its performance packaging, price, size, etc. Theses qualitative answers aretransferred to a chart (called a perceptual map) using a suitable scale and

the results are employed in improving the product or in developing a new one.

A perceptual map is a means of displaying or graphing in two dimensions the location of

products or brands in the minds of consumers to enable a manager to see how consumers

perceive competing products or brands relative to its own and then take marketing actions.

HOW A Perceptual map is created ?

Choose a product orservice and identify three companies who manufacture it. For example,

you might choose peanut butter as the product you will study. Then identify three peanut butter

manufacturers. Next create two questions about how the peanut butter product is positioned

compared to its competitors, the other two brands of peanut butter. Ask six people your

questions and plot their answers on your perceptual map. Analyze your results, draw

conclusions (such as, do you think the product or service is competing head-on or is avoiding

competition?), and if needed, make recommendations about the positioning of your chosen

product.

.


32/61


33/61

We must remember that perceptual maps are plotted on the basis of some ones

perception and what maybe a quality product to one person, may not be perceived as

quality to another.

When plotting a perceptual map two dimensions are commonly used. Below is a very

basic perceptual map. If we plot the UK chocolate market we can identify those brands

which are high price and high quality. Belgium chocolates are plotted as high quality

and high price, and Twix is plotted one low quality low price brand. Once completed the

perceptual map could help identify where an organization could launch a new brand

perhaps at the medium price and quality range.


34/61

Product

A product may be defined as anything that can be offered to a market for attention, acquisition,

use, or consumption that might satisfy a want or need. Products includes more than justtangible goods. Broadly defined, products include physical objects, services , events, personsplaces, ideas, organizations, or mix of these entities.

A service may be defined as any activity or benefit that one party can offer to another party thatis essentially intangible and does not result in the ownership of anything.

A product has three dimensions or layer, which must be distinguished.

1. Core product ( Benefit )2. Formal product ( Actual product)3. Augmented product.

Core benefit ( product):-It is the fundamental dimension of a product as it represents bundle of benefits to itsprospective customers ( buyers) .The core product answer the question : what is thebuyer buying ??For example a women buying a lipstick, is buying hope and not a set of chemicals andphysical attributes for their own sake.


35/61

A person buying a washing machine is buying comfort and not a mere collection of drum, heater,and nuts and bolts for his own sake.

The basic job of a marketer is to sell the core benefits.

Actual products - it is the larger packaging of a core product . It is what the target marketrecognizes as the tangible offer(product) . A product is a physical object have the followingattributes: Features Style or Design Level of qualityA brand name Packaging

Augmented products:-

It is a broader conception of the product . It represents the totality of the benefits that a

consumer may receive or experience in getting the actual product . The augmented

product of a TV distributor is not only the TV .. But also the whole set of accompanying

services like instructions, free home delivery, free installations, warranty, and service and

maintenance. This dimension of the product is very important for a firm operating in a

competitive market. The firm that develops the right augmented products will be able to

attract more consumers and survive in the competitive market.


36/61

Core

benefits

Actual products

Brand

name

Quality

level

Packaging

Design

Features

Augmented product

After sale

services

installationwarranty

Delivery

and credit

Three level of product


37/61

Product mix

A product mix consists of all the product lines and items that a particular seller offer for sale . Acompanys product mix has four important dimensions .

1. Width2. Length3. Depth4. Consistency

Product mix width:-

It refers to the number of different product lines the company carries. P & G market a fairlywide range of the product mix consisting of 250 brands organized into many product lines.These lines includes homecare, baby care, beauty care, health care, and food and beveragesproducts.

Product mix length:-It refers to the total no of items, one company carries within its product lines. P & G typically

carries many brands within each line. For example it sales six laundry detergents, six handsoaps, five shampoos etc.

Product line depth:-It refers to the number of versions offered of each product in the line. For example Hindustanunilever Ltd is offering bath soaps Lifebuoy, Lux, Breeze, Liril, Rexona,Hamam and Motisoaps.


38/61

Consistency of the product mix:-

It refers to how closely related the various products lines are in end use, production requirement,distribution channels, or some other way. P & G s product lines are consistent insofar as they areconsumer products that go through the same distribution channels. Lines are less consistentinsofar as they perform different functions for the buyer.

Product Differentiation:-

Product differentiation is a marketing strategy in which busnis firms attempt to create and exploitdifferences between their products and those offered by competitors. These differences may leadto competitive advantage if customers perceive the difference and have a preference for thedifference.

A product differentiation strategy requires that a firm be able to effectively communicate withcustomers through advertising, public relations, sponsoring of events, etc.


39/61

Product Differentiation...is creating products so that customers perceive

them as different from competing products .

Profit

Form creation

Idea

Acceptance Demand Estimation

A manager s view


40/61

(a) Differentiation through Multiple sources

L&T , the engineering firm , recruits engineers with excellent qualification and

engineers with excellent qualification and claims superiority in executing projects.

Modi Xerox with its collaboration with Rank Xerox as its differentiation.

Coke and Pepsi differentiated through brand power.

(b) Product Differentiation based on ingredients

HULs Close-up based on gel used Glycerine while others use calcium

carbonate .

Dabur Vatika with herbal ingredients used by woman for hair care -Coconut oil

,Brahmi , Lime and Mehandi etc.

Product Differentiation through Functional values

Videocon computer controlled fridge,450 lts, 6 door with quick freezing corner

and Deodorizer at a touch of with quick freezing corner and Deodorizer at a touch

of finger .


41/61

(d) Product Differentiation through Additional features

Mega Feature BPL , Videocon , ONIDA , Philips Large screen features .

Aristocrat suitcases with wheels , a unique convenience to users.

(e) Product Differentiation by Packaging

Frooti in Tetra packs.

Le sancy in see thru pack.

Harpic Toilet cleaner with an application friendly nozzle.

(f) Product Differentiation by Design

Product attributes (tangible or intangible tangible or intangible) separate your

product from others - Kinetic Honda with electronic ignition and do away with kick

start routine , automatic gear shifting especially for women.


42/61

(g) Services Differentiation

When Physical cannot easily differentiated , the key to competitive success may lie in

adding services and improving their quality. The main service differentiators are :

Ordering ease

Delivery

Installations

Customer Training

Maintenance and Repair

Miscellaneous Services


43/61

The company has a distribution channel of 6.3 million outlets and owns

35 major Indian brands.[3] Some of its brands include

1. K

walityW

all's ice cream,2. Knorrsoups & meal makers,3. Lifebuoy, Lux, Breeze, Liril, Rexona, amamand Moti soaps,4. Pureit water purifier,5. Lipton tea, Brooke bond tea, Bru coffee,6. Pepsodent and Close Up toothpaste and brushes, and7. Surf, Rin and Wheel laundry detergents,8. Kissan squashes and jams,9. Annapurna salt and atta,10. Pond's talcs and creams, Vaseline lotions, Fair and

Lovely creams, Lakm beauty products,11. Clinic Plus, Clinic All Clear, Sunsilk and Dove shampoos, Vim dish wash, Ala

bleach,

12. Domex disinfectant, Rexona13. Modern Bread, and14. Axe deosprays.

Products offered by hindustan unilever Ltd.


44/61

1. Ariel is a brand of laundry detergent/liquid available in numerous forms and scents.2. Crest is a brand of toothpaste and teeth whitening products.3. Dawn is a brand of dishwashing detergent

4. Downy/ Lenoris a brand of fabric softener.5. Duracell is a brand of batteries and flashlights.6. Fusion is a brand of men's wet shave razors.7. Gain is a brand of laundry detergent and fabric softeners.8. Gillette is a brand of safety razor and male grooming products.9. Head & Shoulders is a brand of shampoo and conditioners.10. Old Spice is a brand of aftershave Deodorants, Soaps and Body wash

11. Ivory is a soap.12. Nice 'n Easy is a hair coloring product.13. Olay is a brand of women's skin care products.14. Oral-B is a brand of toothbrush, and oral care products.15. Pampers is a brand of disposable diaper and other baby care products.16. Pantene is a brand of hair care products (conditioners/styling aids).17. Puffs is a brand of facial tissue

18. Secret is a brand of antiperspirant and deodorant.19. TAG is a deodorant and body spray.20. Tide is a brand of laundry detergent.21. Wella is a brand name of hair care products (shampoo, conditioner, styling, and hair color).22. Whisperis a brand of panty liners sold primarily in Asian markets.

Products mix of procter and gamble


45/61

Product classification

Product and services can be classified in to two categories :

(a) Consumer products

(b) Industrial products.Consumer products:- consumer product and services bought by final consumers for personal

consumption. These products include convenience products, shopping products, specialtyproducts and unsought products.

(a) Convenience products:- these are the items which the consumer buy frequently,

immediately and with minimum shopping efforts. Cold drink, cigarettes, magazines andnewspaper, drugs and most grocery items are the examples of these products . Theseproducts are non-durable and used and consumed rapidly.

(b) Shopping products:- these products include items which the consumer select and buyafter making comparison on such criteria such as suitability, quality, price and style.Furniture items, dress, shoes, TV , refrigerator , and other home appliances are the example

of shopping goods. These goods are durable and is used up slowly. The consumer has tocompare different stores offerings and devote considerable time and efforts to take thebuying decision.

(c) Speciality products:- consumer products with unique features or brand identification forwhich a significant group of buyers is willing to make a special purchase effort. For examplespecific brands, types of cars, luxury watches, designer clothes service of medical and legal

specialists.


46/61

(d)Unsought products:-consumer products that the consumer either does not know about or knows about but doesnot normally think of buying. For example blood donation to Red cross, Life insurance. By

their very nature , unsought products require a lot of advertising, and other marketing efforts.

Industrial products:- are those meant for use in making other products or forrendering a service in the operation of business firm. These can be further classified on thebasis of use into five categories.

Raw material : Fiber for making yarn, etc.

Fabricated material and parts: yarn for knitting / weaving etc.

Installations : Heavy machinery , diesel engine, trucks etc for industrial use.

Accessories equipment : Buttons, zipper, labels, laces, etc.

Operating supply: these are the convenience goods for industrial products, oil, pen, pencil,paper, pins, fuel. etc


47/61

Product life cycle

The concept of product life cycle has gained importance as it indicates that sooner or

later all products die and if management wishes to sustains its revenue , it must replace

the declining products with new ones. The product life cycle concepts also indicateswhat can be expected in the market for a new product at various stages.

The product life cycle concepts is also a useful framework for describing the typical

evolution of marketing strategy over the product life cycle. This will help in taking

sound marketing decisions at different stages of the product life cycle.

The product moves through the four stages :

1. Introduction

2. Growth

3. Maturity

4. Decline

As the product moves through different stages of its life cycle, not only do profit and

sales volume changes from one stage to the other stage but also the management

decisions regarding the marketing mix undergoes changes from stage to stage.


48/61

ProductDevelop-

ment

Introduction

Profits

Sales

Growth Maturity Decline

Losses/

Investments ($)

Sales andProfits ($)

TIME

Product life cycle

1 I trod ctio ta


49/61

1. Introduction stage:-The first stage of PLC is the introduction, under which competition is slight or non-

existent , price are relatively higher, market are limited and rapid improvements are

being made in its technology . The growth in sales volume is at lower rate because of

lack of knowledge on the part of consumers and delays in making the product

available to the consumer. During this stage higher expenditure are to be incurred on

advertising and other promotional techniques. Price are higher during this stage

because of small scale of production, technology problems, and heavy promotional

expenditure.

2. Growth stage :- as the product grows in popularity, it moves into second phase of

its life cycle i.e. growth stage in which demand expands rapidly, price fall,

competition increases, and distribution is greatly broadened. The management

focuses its attention on improving the market share by deeper penetration into the

existing market or entry into the new markets. The promotional expenses remain

high although they tend to fall as a ratio to sales volumes. It will increase the profit .

3. Maturity stage:- the product enters into maturity stage as competition intensifiesfurther and market grows saturated. Profits come down because of stiff competition

, and marketing expenditure rise. The price are decreased because of competition

and technology. This stage may last for long period as in the case of many products

with long run demand characteristics. But sooner or later , demand for the product

starts declining as new product displace it. Product differentiation, identification of

new segments and product improvements are the strategies are followed in this

stage.


50/61

4. Decline stage:-

The stage is featured by either the products gradual displacement by some new

products or evolving change in consumer buying behavior, the sales fall down sharplyand the expenditure on promotion has to be cut down drastically . Many firm

abandon the product in order to put their resources to better use. The demand of the

people change and other innovations come to the market to take place of the

abandoned products.


51/61

Style , Fashion , Fad

Basic, Fashion, and Fad ProductsApparel and other consumer products can be classified by the length of their life

cycles. Basic products such as T-shirts and blue jeans are sold for years with fewstyle changes. Businesses selling basic products can count on a long product lifecycle with the same customers buying multiple units of the same product at once orover time..


52/61

Fashion product life cycles last a shorter time than basic product life cycles. By definition, fashion is astyle of the time. A large number of people adopt a style at a particular time. When it is no longeradopted by many, a fashion product life cycle ends. Fashion products have a steep decline once theyreach their highest sales.

The fad has the shortest life cycle. It is typically a style that is adopted by a particular sub-culture oryounger demographic group for a short period of time.The overall sales of basic products are the highest of the three types of products, and their life cyclesare generally the longest.

Apparel products often have a fashion dimension, even if it is just color. As fashion features increase ina product, the life cycle will decrease. Therefore, if you are designing a fashion product, you will want

to have multiple products in line for introduction as each fashion product's cycle runs its course.Some firms build their lines to include basic, fashion, and fad products in order to maximize sales.

For example, with a sweater line, a business may have four styles that have classic styling andcolors and are always in the line. Four additional styles may be modified every two years to includesilhouette, length, and collar changes based on the current fashion. One or two short-cycle fashion

or fad styles based on breaking trends may be introduced once or twice a year. Styles that apopular celebrity or sports hero is wearing are examples of fashion and fad styles.

N d t d l t


53/61

New product developments

A firm can obtain new products in two ways. One it is through acquisition ----by buying a wholecompany, a patent, or a license to produce some ones product. Or other through New product

development in companys on research and development department .

New product development:- means development of new original product , product improvement,product modification, and new brand that the firm develops through its own research anddevelopment efforts.

Followings are the main stages in new product development.

1. Idea generation2. Idea screening3. Concept development and testing4. Marketing strategy5. Business analysis6. Product development7. Test marketing8. Commercialization


54/61

Major stages in new product development


55/61

New Product Development Process

Step 1. Idea Generation

The Systematic Search forNew Product Ideas

Internal sources : From companys own executives, scientists, engineers, designers,manufacturing staff, marketing and sales executives etc.

External sources :

1. Customers

2. Competitors

3. Distributors

4. Suppliers


56/61


Step 2. Idea Screening

Process to spot good ideas and drop poor ones

Criteria : Market size

Product price

Development time & costs

Manufacturing costs

Rate of return


57/61


Step 3. Concept Development & Testing

3. Choose the Best One

2. Concept Testing - Test theProduct Concepts with Groups

ofTarget Customers

1. Develop Product Ideas intoAlternative

Product Concepts


58/61

Part One - Overall:Target Market

Planned Product PositioningSales & Profit Goals

Market Share

Part One - Overall:Target Market

Planned Product PositioningSales & Profit Goals

Market Share

Part Two - Short-Term:

Products Planned PriceDistribution

Marketing Budget

Part Two - Short-Term:

Products Planned PriceDistribution

Marketing Budget

Part Three - Long-Term:Sales & Profit Goals

Marketing Mix Strategy

Part Three - Long-Term:Sales & Profit Goals

Marketing Mix Strategy

Marketing Strategy Statement Formulation


Step 4. Marketing Strategy Development




59/61

Business Analysis

Review ofProduct Sales, Costs,and Profits Projections to See ifThey Meet Company Objectives

If Yes, Move toProduct Development

IfNo, Eliminate

Product Concept


Step 5. Business AnalysisStep 6.Product Development


Step 5. Business AnalysisStep 6.Product Development




60/61

SimulatedTest Market

Test in a simulatedshopping environment

to a sample ofconsumers.

SimulatedTest Market

Test in a simulatedshopping environment

to a sample ofconsumers.

ControlledTest Market

A few stores that have

agreed to carry newproducts for a fee.

ControlledTest Market

A few stores that have

agreed to carry newproducts for a fee.

StandardTest Market

Full marketing campaignin a small number of

representative cities.

StandardTest Market

Full marketing campaignin a small number of

representative cities.


Step 7. Test Marketing


Step 7. Test Marketing




61/61

e oduct e e op e t ocess

Step 7. Commercialization

e oduct e e op e t ocess

Step 7. Commercialization

Introducing a new product into the market

Advace Fashoin Marketing

Documents

Transcript of Advace Fashoin Marketing