MARKETING

Montu Basak
Assistant Professor Fashion & Apparel (Fashion Design) National Institute of Fashion Technology, Kolkata Jan-July 2011

Session 7

CONTINUED: MARKETING MIX

Marketing Mix is a term which is used to describe the combination of the four inputs which constitute the core of a companys marketing system: 4Ps; The Product, The Price Structure, The Product Promotion and The Physical Distribution.
Marketing mix is an important tool in the process of successful business enterprise. Every business enterprise has to determine its efficient marketing mix for the satisfaction of needs of the customers. It can be changed according to the change in taste of the customers.

CONTINUED: MARKETING MIX

Every business firm has to determine its Marketing Mix for the satisfaction of needs of the customers. Marketing Mix represents a blending of decisions in four areas1. Product 2. Price 3. Place 4. Promotion These four elements of Marketing (called as 4Ps) mix are inter-related in such a way that decisions taken in one area usually affect actions in others. It is a dynamic state of affairs of the marketing system of a business firm. It concentrates on how to satisfy the needs of the customers, If the needs of the consumers change, the Marketing Mix will also be changed.

PRICE Credit Allowance Discount Price

PRODUCT Range Product Service Brand Package

CUSTOMER
PROMOTION Advertising Publicity Personal Selling Sales Promotion PHYSICAL DISTRIBUTION Channel Transport Storage Inventory Control

Component of Marketing Mix

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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 just tangible goods. Broadly defined, products include physical objects, services, events, persons places, 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 that is essentially intangible. A product has three dimensions or layer, which must be distinguished. 1. Core product ( Core Benefit ) 2. Formal product or Actual product 3. Augmented product.

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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 business firm. It should also emphasis on its proper Branding, packing, colors, and other features. In other words production planning and development involves decision about . 1. Quality of the product 2. Size of the product 3. Design of the product 4. Volume of the production 5. Product range 6. Branding 7. Packaging 8. Warranties and after sale services 9. Product testing etc.

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Core product (core benefit)

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

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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.

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Augmented product

Delivery and credit Brand name

Actual product

After sale services

Features

Quality level warranty

Core benefits
Design installation Packaging

CONTINUED: PRODUCT CONTINUED: MIX PRODUCT

CONTINUED: PRODUCT CONTINUED: MIX PRODUCT

Product Mix: Width It refers to the number of different product lines the company carries. P & G market a fairly wide 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 beverages products.

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Product Mix: Length It refers to the total no of items, one company carries items within its product lines. P & G typically carries many lines brands within each line. For example it sales six laundry detergents, six hand soaps, five shampoos etc. Product Mix: Depth It refers to the number of versions offered of each product in the line. For example Hindustan unilever Ltd is offering bath soaps Lifebuoy, Lux, Breeze, Liril, Rexona,Hamam and Moti soaps.

Liril, lifbuoy, lux, Rexona, Hamam, Moti

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

CONTINUED: PRODUCT CONTINUED: MIX PRODUCT

The company has a distribution channel of 6.3 million outlets and owns 35 major Indian brands. Some of its brands include 1. Kwality Wall's ice cream, 2. Knorr soups & 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, and 7. 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, Rexona 13.Modern Bread, and 14.Axe deosprays.

Product Depth Product Depth

Product Mix
Product Length

Product Length

Product Depth

Product Length

Product Mix of HUL can be explained with the help of the above information.
Width: The width of the product mix refers to how many different product lines the company carries. The product lines are broadly classified into three main categories. They are 1.Home and Personal Care 2.Food 3.Water But all together there thirteen (13) product lines for HUL (HUL has other businesses as well). Length: The length of a product mix refers to the total number of items in the mix. From the above figures, the length of the HUL product mix is 38. We can also talk about average length of a line. This is obtained by dividing the length (38) by the number of line (here 13) which is less than 3 in this case. Depth: The depth of a product mix refers to how many variants are offered of each product inthe line. For example, if Brooke bond in the tea line of food brand has 4 variants Brooke Bond3 Roses, Brooke Bond Red Label, Brooke Bond Taaza and Brooke Bond Taj Mahal. And if each comes in 3 sizes 100gm, 200gm, & 500gm packets then the depth will be 12 (4 variants X 3sizes). Consistency: The consistency of the product mix refers to how closely the various product linesare related in end use, production requirements, distribution channels, or some other ways.HUL s product lines are consistent as they are all consumer goods that go through the samedistribution channels. The lines are inconsistent when the end function of each items are takeninto consideration (some are hair care products skin products, food products, laundry productsetc)

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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/ Lenor is 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. Whisper is a brand of panty liners sold primarily in Asian markets.

CONTINUED: PRODUCT CLASSIFICATION

CONTINUED: CONSUMER PRODUCT

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Convenience products: These are the items which the consumer buy frequently, immediately and with minimum shopping efforts. Cold drink, cigarettes, magazines and newspaper, drugs and most grocery items are the examples of these products . These products are non-durable and used and consumed rapidly.

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Shopping Products: These products include items which the consumer select and buy after 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 to compare different stores offerings and devote considerable time and efforts to take the buying decision.

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Specialty products: Consumer products with unique features or brand identification for which a significant group of buyers is willing to make a special purchase effort. For example specific brands, types of cars, luxury watches, designer clothes service of medical and legal specialists.

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Unsought products:Consumer products that the consumer either does not know about or knows about but does not 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.

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Industrial Products:- are those meant for use in making Products other products or for rendering a service in the operation of business firm. These can be further classified on the basis 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

CONTINUED: 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 indicates what 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. This will help in taking sound marketing decisions at different stages of the product life cycle.

CONTINUED: PRODUCT LIFE CYCLE

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Sales and Profits ($)

Sales

Profits

Product Development

Introduction

Growth

Maturity

TIME Decline

Losses/ Investments ($)

CONTINUED: PRODUCT LIFE CYCLE

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.

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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 .

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Maturity Stage: The product enters into maturity stage as competition intensifies further 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

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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 sharply and 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.

CONTINUED: FASHION LIFE CYCLE

CONTINUED: FASHION LIFE CYCLE

Basic Apparel 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 few style changes. Businesses selling basic products can count on a long product life cycle with the same customers buying multiple units of the same product at once or over time.

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

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Fad
The fad has the shortest life cycle. It is typically a style that is adopted by a particular subculture or younger 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 cycles are generally the longest.

Apparel products often have a fashion dimension, even if it is just color. As fashion features increase in a 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 and colors and are always in the line. Four additional styles may be modified every two years to include silhouette, 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 a popular celebrity or sports hero is wearing are examples of fashion and fad styles.

(For your kind patience)