Understanding the Marketing Mix and Its Impact on Business Success

1. Class : Y10 • Lesson Topic: Marketing • Scheme of Work: The Marketing Mix

2. Lesson Objectives P&D Planning and Data ALL (KNOWLEDGE) Describe a market and the different aspects of marketing mix MOST (ANALYSIS) Analyse the marketing mix and apply your understanding to a case study SOME (EVALUATION ) • Evaluate the usefulness of marketing mix to the success of a business. Higher thinking Skills

3. By end of lesson you will Climb the Ladder ATD Apply to demonstrate

4. Key Words; • Before we start can you find these definitions in your textbook • Marketing Mix • Pricing strategies • Above/below line • Distribution • Packaging • Product life cycle

5. COMPARING Equally… As with… Like… In the same way… Similarly… Even so… Likewise… CONTRASTING Although… Except… Moreover… If… However… Yet… Apart from… Unless… Despite… As long as… QUALIFYING Despite… Yet… As long as… Unless… Apart from… If… Moreover… Except… However… Although… CAUSE & EFFECT Consequently… Due to… As a result… Therefore.. Because of… Because… ADDING In addition… And… Too… Also… Additionally… As well as… Furthermore… CONNECTIVES for Analysis CONNECTIVES for Application CONNECTIVES for Evaluation CONCLUDING Firstly… After… Secondly… Before… Overall…I believe… Finally… I think … In conclusion… it depends… To conclude… short term… Meanwhile… Long term… EMPHASISING Most importantly… Significantly… Notably… Especially… Above all… In particular… Indeed… ILLUSTRATING For instance… Such as… In the case of… So… For example… As revealed by… As illustrated by…

6. Prepare for Learning – 5mins PfL Can you remember some keywords for each section?

7. Marketing Mix

8. The marketing mix • A coherent marketing strategy for a business to target its market in relation to its marketing objectives. • 4Ps – Price, Product, Promotion, Place. • We will study each P to learn the marketing mix.

9. 1. Price • Firstly, basic economics dictates the price of a good.

10. 1. Price • Other factor affecting Price of a good or service; • Tax – Some goods are taxed to increase Price (cigs) • Competition Pricing – Businesses monitor other businesses prices. • Costs of production – Costs of oil, labour, transport affect prices. • Objectives – If a firm wants to grow it might ______ price.

11. 1. Pricing Strategies • . Cost based Pricing A simple pricing strategy where businesses calculate their costs ($50 per unit), add a mark up (e.g. 10%) and find their price ($55). No analysis of customer wants/needs. Does assure profit

12. ii. Market orientated Pricing • This approach has some analysis of the market. • Skimming - High price for a new product to maximize revenue. (inelastic) • Discount – Selling goods at lower prices that competition (surplus stock) • Penetration - Low Price for new product to maximize sales/share. (elastic) Discount

13. ii. Market orientated Pricing • Also, • Psychological pricing • $9.99 seems cheaper than $10.00? • Loss leader • Selling items in store at loss to attract customers in (e.g. milk in supermarket)

14. iii. Competition based pricing • This is when you price according to the COMPETITION. • The dominant firm becomes the Price Leader and set the price for others to follow. • Charge same price as the price leader. • Charge much lower than others, called predatory pricing to steal market share.

15. Price elasticity of demand Goods with elastic demand Goods with inelastic demand • A price change will result in a significant change in demand for the product. • Lower price to increase demand and increase TR • A price change will have little impact on amount of demand. • Higher price for increase TR! Why?

16. Price elasticity of demand • Discuss whether these items are elastic or inelastic demand • Cigarettes • Generic blue shirt • Gucci blue shirt • Toyota Land cruiser • Nandos meals • School lunches What would you do to the price to increase / decrease TR>

18. Mini – Plenary Pricing • Explain how price is determined • Explain market orientated pricing • What’s the difference between cost based and competition pricing? • What pricing is best for MCd Happy meals? Why?

19. Mark up Competition based pricing Cost based pricing Psychological pricing skimming Market orientated pricing Penetration pricing Demand and supply market Discount

20. Marketing Mix

21. Neighbours – Marketing Mix R Review the Learning 2 things your neighbour has learnt about marketing mix 1 question your neighbour wants to ask about marketing mix

22. 2nd P . Promotion • Communicate with customers • 2 types… • Above the line • Advertising through the media, TV, magazines, online, radio. • Below the line • Not the media. Coupons, direct mailing, displays in shop, BOGOF, Loyalty cards

23. Below Line • Other below the line options are • Call Centre • Door step selling / mailing • Trade fair stand.

24. Purpose of Promotion • What’s the purpose of Mercedes advertising / Promotion? • Inform • Reassure • Persuade • Reach new customers Extension (who is target market segment?)

25. Promotion Above v. Below

26. Business Bad image?

27. Public Relations (PR) • Many businesses now communicate with stakeholders through PR> This seeks to improve the IMAGE of the business. • FT: How to avoid PR Disaster! • Press Release • Press Conference • Sponsorship (Risky?) • Donations

28. Choosing Promotion Methods • What must a business think about (evaluate) before it chooses a method of Promotion? • Customer • Product • Cost • Competion

30. Marketing Mix

31. Personal selling promotion Public Relations BOGOF Direct mail Above the line Loyalty cards Below the line Advertising Coupon

32. Neighbours – Marketing Mix R Review the Learning 2 things your neighbour has learnt about marketing mix 1 question your neighbour wants to ask about marketing mix

33. 3. Place • Where and how to purchase the product. • Not everyone sells in a shop. • The route from producer to consumer is called DISTRIBUTION CHANNEL.

34. Distribution • Wholesaler • Is a warehousing agent where goods are stored for retailers • Retailer • Is the shop where customers buy their goods (e.g. Carrefour) DIRECT

35. 2 main types of distribution • Direct Selling • Telephone • Internet • Door to door • Mail • Retailing • hyper market • Department store • Market trader • Kiosk • Supermarket

36. Evaluation • How you distribute your products depends on; • Costs • Product • Customer • Competition

38. Marketing Mix

39. Personal selling promotion Public Relations BOGOF Direct mail Above the line Loyalty cards Below the line Advertising Coupon

40. Neighbours – Marketing Mix R Review the Learning 2 things your neighbour has learnt about marketing mix 1 question your neighbour wants to ask about marketing mix

41. 4. Product • Firstly, a product goes through a design process which will meet customer needs.

42. 30 secs, how many brands can you remember?

44. 30 secs, how many brands can you remember? Click hyperlink to see the top 10 brands

45. Branding and Packaging • 2 important elements of a Product for a market orientated business would be branding and packaging the product. • Efficient, effective, attractive packaging can really boost sales and revenue!

46. 2 ways of analysing a products’ success..

47. Product Life Cycle – Sales over time. • A Product is first developed, then goes through 4 stages of life. • The sales increase, then eventually decline. • (EVAL) True for all products? • Can decline be avoided?

48. Extension strategy • A method of extending sales after initial products decline. • New products • New markets • New customers • FT: Lego Success • Explain how Lego has utilized extension strategies? (4m)

49. Boston Matrix • This helps business understand their range of products according to market growth & share.