Concept of Marketing and Pricing Strategies - Essay Example

? Marketing Assessment and number submitted Marketing Assessment Marketing is the total of activities involved in the transfer of goods and services from the producer and seller to the consumer or buyer; including advertising, shipping, storing, and selling (Noble & Mokwa, 1999). It exists in a common place i.e. a market where buyers and sellers meet and engage in the act of trade through the process of exchange i.e. receiving something in return of giving something. This is done through the medium of currency which is a generally acceptable form of payment and exchange all around the world. Concept of Marketing The marketing concept can be described as the achievement of corporate goals through meeting and exceeding customer needs and expectations better than the competition or competitors. This can be done by three steps: 1. Customer orientation – the company’s main focus should be on its target market i.e. customer satisfaction rather than solely improving costs and methods for the company itself 2. Integrated effort – fulfilling customer satisfaction is not a one-man job, it requires a management team and workforce with the common motive to achieve this task through production, finance, research and development 3. Goal achievement – for integrated work to run smoothly and successfully, the management must have strong belief in the fact that corporate goals can be achieved through consumer satisfaction. Marketing Mix A marketing mix is a company strategy that helps boost a company customers, profits and innovations with the help of four steps (known as the 4 P’s) i.e. product, price, promotion, and place. These 4 Ps are the key decision elements that marketers must follow in order to achieve the wants and needs of their clientele above their competitors. This marketing mix however has been extended to 7 Ps with the three additions of people, progress and physical evidence due to the rapid growth of the service industries. The emphasis of every individual element varies depending on the commodities the organization offers. Product. The product decision includes choosing which goods and services the company is willing and able to produce and supply to its target customers. This includes product creation as well as integration and development where by the products supplied and new and improved with the advancements in technology and taste. This phase also includes the branding image of the company i.e. its name, packaging and promotions and offers. It seems that Britvic seems to rely on the porter’s model of differentiation to keep its products relevant to the UK’s beverages market. Hence there is more focus on offering the customers a good variety and availability of product, importantly, along with a focus on development of the products to keep the customers interested rather than offer the highest standards of quality (taste) or uniqueness of product and taste. This might be because a large part of Britvic’s business activity consists of distributing drinks of established brands such as PepsiCo and hence the company can choose to rely on provision of quality service to other businesses to maintain relevance to the consumer market rather than on maintenance of quality. Placement. Placement deals with decision making regarding distribution channels. Key management decisions stress upon locations of its outlets, transportation facilities, and inventory levels of stock and stock needing to be reordered. The main goal is to ensure products and services are available in the desired and sufficient quantities, at the desired time durations and venue. These distribution channels consist of organizations such as retailers and wholesalers who act as an intermediary through which commodities pass on their way to customers. Producers need to manage their relationships with these organizations in order for them to provide cost-effective access to that specific firm and the market they belong to. They also need to be familiar with new methods of distribution that can create a competitive advantage and enable the organization to achieve economies of scale. The company Britvic has only one major distribution centre in the country of Great Britain which indicates a lack of dependency on stocking to deliver its product on time and in required quantities to the customer whether the customer be a corporation or the consumer. Britvic has a stated strategy of delivering the right product at the right place (Cheney, 1947). Hence with an excellent Fast-Moving Consumer Goods production and delivery mechanism the only worry for the company in regard to distribution from its main facility is the cost of logistics depending upon the remoteness of the target market, the frequency of delivery orders and the type of shipment required for each market. It is obvious that Placing is in fact the key element of Britvic’s business strategy. One of the reasons the company is able to maintain the dependence of its corporate clients on it for the distribution of their products is the sheer size of the Britvic’s distribution system whereby it is able to market over 1.4 billion soft drinks every year (Britvic Case Study: Maintaining Growth in the Downturn by Focusing on the Value Soft Drinks Categories, 2009). A huge majority of these drinks consist of the type of drinks the company itself classifies as ‘take-home’ drinks, most of which are patented by other companies. This proves that in Britvic’s business model the most important tool for progress is the placement of its product in regard to the needs and desires of consumers rather than the growth and valuation of its brand names. Pricing Strategies Pricing strategies are the most essential stages for an organization as it is the only mix, which generates company turnovers. The major cost a business incurs includes production, product designing, distribution and promotion. The set price must support all the elements of the market mix and must cover the costs of the production while setting an average markup margin enough to generate sales and profits while not fleecing its customers. This requires the calculations of marginal and average costs and revenues and must reflect supply and demand relationship as inaccurate pricing could lead to loss, loans and debt. As is common for packaged food products around the world, the prices for Britvic products are fixed. It is pertinent to mention here that the company has in the past employed the tactic of manipulating the prices of products of its own brands to compensate from losses stemming from the marketing of third-party products that the company produces and distributes and does not have pricing control over. Because the company maintains much less inventory compared to other packaged food producers such as its main competitor, Coca-Cola, Britvic has a sophisticated mechanism for contracting distributors and hence the pricing policy for goods is most responsive to fluctuations in demands for the products; whereas the pricing policies for services and production for corporate clients are dependent on the contracting and risk management strategies that the organization employs. Promotional Mix Promotional mix is a combination of various elements that combine together to meet the requirements of its targeted clients. This is mutually achieved by both the owners and the employees of the company through common motives for e.g. the entrepreneur does all the decision making and risk taking however the sales staff have the expertise to convince and influence and successfully make the sale. Therefore it is essential to adopt all the needed elements of the promotion mix to get a better response from the target customers. There are six main elements in Britvic’s promotional mix: Advertising. Advertising is the means of communication through mass media projecting the good or service by sponsors on the radio, internet and television and also through reading materials called print advertisements put up on billboards, and distributed through local newspaper distributors with company flyers, brouchers/pamphlets and catalogues. Britvic does not advertise the company name apart from through the products it sells to the consumers. Instead the company has specialized marketing strategies for each of its brands under which the advertisement budget and tactics are localized. The organizational structure includes brand managers for each of the larger company-owned brands like Robinson’s and Shandy Bass. Sales promotion. This is an activity that offers an incentive for a limited time duration to obtain a desired response from the target audience or intermediaries including both the wholesalers and retailers. Britvic offers incentives to retail stores chains for the promotion of its products such as sponsoring the employee rewards for select stores in return for priority in the location of certain products to increase their visibility to visitors of the stores. Similarly it conducts promotional campaigns for the launch of its new products where contingency workers are employed who are responsible for in-person marketing to the consumer, often offering free try-outs of the newly launched products, and are paid per the number of consumers engaged. Corporate image building. It is important to build a unique, stand-out and innovative image in the sight of the general public as the visionary picture of an organization to every individual is a crucial point in marketing. In the conventional sense, image-building for FMCG producers like Britvic has long been a realm of the particular brands produced by these companies. However as these producers get older as enterprises along with their long-served customers and as consumer awareness surges to the very high levels indicated by contemporary research, these manufacturers have developed and continue to develop deep rooted images of their own in the minds of the consumers. The top FMGC companies of the world, such as Unilever, are now realizing this fact and coming up with image-building ideas such as strategic Corporate Social Responsibility activities and promotion of the company’s image through advertisement in popular media; however Britvic along with most of the FMGC world has yet been indifferent this kind of promotion which is still considered superfluous. Still Britvic does manage effective presentation to its corporate clients evidenced by the recent awards to it of multi-billion dollar contracts by PepsiCo in 2008 and 2009. Segmentation, Targeting and Positioning Market segmentation is a marketing strategy that divides a broad market target into subdivisions of buyer groups with common wants and needs and creates a newly updated and improved product to fulfill these needs with the help of the many media advertisement techniques mentioned above. An ideal marketing segment follows a set patterned criterion: It is measurable i.e. buyers and product estimations can be concluded It should be in a large size; enough to generate profits It must be stable and for see long-term continuity without the chances of failure Goal to reach potential customers through product promotion and distribution should be attainable Internal homogeneous products should be developed and produced Externally heterogeneous i.e. potential customers come from different segments and therefore have different tastes and quality preferences over others It should respond immediately and accurately to a given market stimulus Market intervention is attainable in a cost-effective manner It is useful in deciding on the marketing mix and its required elements / components The broadest categories of segmentation of Britvic customers are school, college and university students, children, middle-aged professionals, and romantics. It is evident from the marketing techniques and brand advertisement campaigns of Britvic that the company essentially does not engage senior citizens through its marketing strategy. Overall the two main segments of society targeted most by Britvic can be summed up as children and young people. The company itself classifies the target markets of its marketing orientation into the categories of ‘take-home’ and ‘on-premise’ markets. ‘Take-home’ relates to the non-setting-based products that are consumed in mass numbers through the everyday activities of consumers. Whereas the success of ‘on-premise’ marketed products is dependent upon their effectiveness and suitability to certain scenarios and settings; such as use in social interactions, romantic settings, public gatherings etc. The positioning of Britvic as a product itself is really divided into two very different spheres: Its positioning towards other brands that represent its current and potential prospective customers; and its positioning towards consumers in the general public. For the general public the positioning of Britvic is really represented by the positioning of its brands. However there is one promoted position of Britvic’s products that is reflected in most of its branding approaches. The company finds its place in the market through representation of the relatively healthy soft drinks as reflected also in the design of the company’s logo which depicts a fresh orange. This position is one that the company aims to pursue further as evidenced by its recent (2008) contracting of production and distribution responsibilities of PepsiCo’s strategically named drink Vitamin Water. Britvic was in fact founded as the British Vitamin Products Company in the 1930s. References BBC News, Business Section / World Section / UK Section: http://www.bbc.co.uk/news/ Brassington, F, Pettitt, S., (2007), Essentials of Marketing, Second Edition, Prentice Hall, England Britvic Case Study: Maintaining Growth in the Downturn by Focusing on the Value Soft Drinks Categories. (2009). S.l.: Datamonitor Plc. Cheney, R. H. (1947). The biology and economics of the beverage industry. Economic Botany, 1(3), 243-275. CIM (The Chartered Institute of Marketing): http://www.cim.co.uk Jobber, D, (2010), Principles and Practice of Marketing, Sixth Edition, McGraw Hill, Great Britain Kotler, P, Armstrong, G., (2010), Principles of Marketing, Thirteenth Edition, Prentice Hall, Great Britain Lawson, R. and B. Wooliscroft (2004) Human Nature and the Marketing Concept, Marketing Theory 4(4), 311–26 Marketing Profs..smart thinking..pass it on: http://www.marketingprofs.com/marketing/library/45/segmentation Marketing Week: http://www.marketingweek.co.uk/ Noble, C. H., & Mokwa, M. P. (1999). Implementing marketing strategies: developing and testing a managerial theory. The Journal of Marketing, 57-73. The Economist: http://www.economist.com/ The FT (Financial Times): http://www.ft.com/home/uk The Guardian – Business Section / World Section: http://www.guardian.co.uk/ The Guardian, Efficient Marketing Strategies for SMEs: http://www.guardian.co.uk/small-business-network/2013/apr/19/effective-marketing-strategies The Independent - Business Section / World Section: http://www.independent.co.uk/ The Times 100 Business Case Studies, Marketing Theory, Marketing Strategy: http://businesscasestudies.co.uk/business-theory/marketing/marketing-strategy.html#axzz2Yw2GuumY Reflective Review The knowledge gained from this course of Marketing will help the students mainly in the pursuit of an academic qualification. However the curriculum of the course is designed in a manner that should enable diligent students to understand the basic principles of marketing strategy. Also the nuances of teaching by lecturers and speakers in this course are a resource that can be of vital importance for the students in pursuit of their future corporate aspirations and that cannot be tapped without attending a course on Marketing like the current course. The one facet of the course that might help me greatly in my pursuit of expertise and vocation in the field of Event Management is the practicing of marketing of specialized products in hypothetical scenarios, an activity that forces a person to think creatively and learn to maneuver his thinking style to tailor it to the thought process most effective in dealing with the marketing of the product at hand. The course also deals to some extent with the aspect of time management in marketing which is a vital quality of progressive event managers as on most occasions the volatility of event planning can cause the event manager to take crucial decisions quickly which might entail the way the event had been promoted to invitees before institution of the changes in the proposed event. And of course the marketing of a commercial event is an elementary part of event planning and management of an event; it is something without success in which the event cannot be deemed successful on the whole and of which the event manager has to bear the most burden. In particular an event manager needs to know how to focus the marketing campaign for the event on the target audience of the product which is the event. For instance, almost all concerts are advertised to specific segments of society, like the youth of a specific ethnic or geographic background. Furthermore the marketing campaign of a concert is often also tailored for followers of the particular genres the music of performing artists of the concert represents. But marketing is not restricted to the domain of corporate sector employment; entrepreneurship and start-ups too, in a majority of cases, depend the most for their success on the efficacy of marketing strategies. Hence the course should help me prepare for my prospective entrepreneurial venturing as well. All-in-all, the course touches on some of the few vital elements of the whole field of business management. Read More