Principles of Marketing - Term Paper Example

Introduction Marketing can be defined as the recognition and expectation needs inorder to meet these needs and achieve one's objectives. In business, there are two main functions, one of them is marketing and the other is innovation. Innovation involves coming up with a new way of delivering services or products while marketing involves getting customers. Once these two aspects have been taken care of then a business has high chances of succeeding. There are four main principles of marketing - sometimes called the 4Ps i.e. Product Price Place - distribution channels Promotion There are also a number of issues that need to be examined like; market research, marketing management and Customers. These issues shall be discussed in detail in the subsequent section of the essay. (Porter, 1985) Price This can be defined as what must be sacrificed or given up by one party in an exchange inorder to obtain another item from the other party. Price means a variety of things to a number of people. The first view is the consumers view. He does not just consider price in monetary terms i.e. what he must pay to get a good or service, but he also considers the time he has to spend to fully utilise the product. This implies that all the trouble he has to undergo before he can derive utility from the product is considered as a price. While the seller considers price in a positive sense in that it is a reflection of the amount of revenue he is getting. It is also seen as a prerequisite to profit. It is also an important marketing aid for organisations. This is because marketers can use their prices as a tool to advertise or promote their wares. There are a number of factors that need to be considered by the marketer when making pricing decisions. This is because it is not just the final consumer who will make contact with his product. Taking an example of a book sold online - the publisher must consider wholesalers, retailers and even resellers because these groups of people will substantially affect his final income. (Hunger, 2003) The main idea behind any price decision is to strike a balance between satisfying the customer's needs while at the same time making profit for the organisation. It should be remembered that price is proportional to innovation. This is because creativity adds value and thus allows the company to raise its price. Besides this fact, a marketer should also incorporate a company's objectives - what does the company want to gain from sale of a product or service. Allowances and discounts need to be integrated too be cause they cause a substantial decrease in sale of the product. If a product is new to the market, it must have a lower price to lure consumers. This is what is called tactful introductory pricing. In addition, a marketer needs to consider geographical factors when setting his price. The product may have to travel long distances from its place of manufacture. Lastly, prices should be flexible at all times. It must reflect both internal and external market forces and these are very dynamic factors. Place -distribution channels Distribution channels include all the people between the consumer and the supplier that are involved in the exchange of services or products. The activities integrated in distribution range from storage, ordering, shipping, promotion, displaying, feedback and selling. In this channelling process there are usually two broad categories i.e. firms specialised in channels and resellers. Resellers are those groups that take over ownership of products from the marketer and sell these to others. Resellers may come in form of a network or may simply be on their own. Examples of resellers include retailers, wholesalers and industrial distributors. Speciality firms provide help with the sale of an item but do not necessarily buy the item. Some of them may be brokers or agents who bring sellers and buyers in concert after a certain charge. Other speciality firms are distribution service firms who help in storage, transportation or other activities that involve movement of the product. Other companies like insurance firms are also considered as speciality firms because they help in distribution too. (Hunger, 2003) Retailing is the process of selling products from one party to a consumer who will use the product personally. There are numerous retailers in the UK. Retailers normally do not obtain their products from the original supplier directly but obtain it from another party in the retail channel. In addition, there are consumers who may act as retailers. This conflicting definition arose after introduction of online purchasing because for one to qualify as a retailer, they must be legally defined as a business and must be taxed. Retailing is a crucial aspect to the marketer because it provides the company with an opportunity to find out information about their consumers. Retailers are able to assess customer's preferences, dislikes and overall purchases. Retailing also provides marketers with an opportunity to promote their products or to give allowances. This is the reason why some manufacturers prefer doing the retailing themselves through their own network. The benefits of such an arrangement is that the company can be able to personalise service provision, get feedback directly from the consumer and eliminate all extra expenses that come with introduction of a chain. The disadvantage with such an arrangement is that customers have to move about from supplier to supplier to purchase different items yet these same consumers would prefer buying a variety of products all under one roof. This is the most important aspect of retailing- most retailers offer variety/do not specialise. (Porter, 1985) Wholesaling is defined as that act of selling products obtained from manufacturers to other buyers. Wholesalers are a link between retailers and suppliers and they provide opportunities to certain organisational buyers like business buyers to purchase items which would have been inaccessible to them in the first place. Wholesalers are important to marketers because they contribute to product movement and obtain products in large concessions. (Grant, 2005) Product movement must also be considered during distribution. Distribution channels do not necessarily provide a means of earning revenue but simply help in delivering the product to a customer. This implies that the marketer should strike a balance between cost of distribution and adequate service delivery to the customer. Taking an example of transporting computer hardware to a client; this client may want to receive his product as soon as he possibly can but shipping companies that provide the fastest delivery are also the most expensive. It is therefore cost effective for the business if the marketer chooses a moderate company to transport the hardware then he will save on costs and can still provide the goods to the client. Sometimes the most efficient distribution channel for the client may not be the most economical choice for the marketer and it is wise to strike a balance between these two obligations. In this case optimisation rather than the best service is imperative. Lastly, it is important for products to be located at a central place. If customers cannot access the product, then how can they buy it The marketer must pay attention to this area because location determines availability hence purchases. Product There are a number of issues that fall under this principle. A product is defined as the service or tangible good made available for exchange; It maybe an individual good, a product line, or a service. The marketer is able to judge how products are moving depending on the demand for the product. A marketer must ensure that the product has the following features; it must have a distinct and clear value addition to a consumer's life. If it is part of a brand within a given brand family, then it must have unique features that either appeal to a new market target or increase the number of purchases by the old target. The product should be seen as something that can solve a particular problem and should stand out from any other item in the market. (McGahan, 2004) The marketer must also pay extra attention to the brand name or product name. This is because it gives the first impression to a consumer. Besides this, marketers must also improve the product's packaging. A case in point is the sale of peanuts. It has been found that customers who purchase peanuts only utilise about twenty percent of the item. The rest of the amount paid for the peanuts goes to packaging. Therefore a product is not simply the item to be used but the whole wrap up. Marketers should also improve their products by accessorising. For example, hair chemicals should be sold together with a scoop to help in application of the product. Companies can also improve their product by providing other features like warranties. This is especially necessary for electronic products or technical items. They should also include instructions on product use. Lack of knowledge on how to use a seemingly complicated product can put off some buyers. It also increases value utilisation of the product since customers will maximise on all functions of the product if an instruction manual has been provided. If a product cannot be utilised directly, that is the product requires installation, then marketers should make sure that this is a service offered alongside the product. All these features mentioned above will give the product an edge over all others and will increase their value. Promotion This is the most typical aspect of marketing perhaps because it requires a creative input. Promotion may be defined as a corporate communication through specific methods to access a specific target. These promotions are done in order to achieve specific objectives of the company. Promotions come in a variety of ways; they may be large scale or small scale. Some companies may spend millions on getting a famous celebrity to endorse their product while other companies may focus on personal selling like dishing out business by a small scale seller. Marketers should remember that promotions are supposed to be in collaboration with other parts of the company. Marketers should make sure that they sell exactly what the production team can deliver. Most of the time, marketers have been accused of overadvertising. Promotions should be realistic and should not promise too much. Promotions within the same company should be coordinated and should sing the same song. This means that if a company does advertisements through television and then sends out its sales team to talk to consumers, they should all be communicating the same message to customers. They need to feel like they are dealing with the same group of people and that they will be buying the same product. It is the continuous repetition of this message that will make clients interested in the product. They must be able to identify with the message for them to purchase the product. Consistency is a key factor in promotion. (Grant, 2005) Advertising, one of the most typical methods of promotions, can be defined as mass promotion through a specific media outlet. It is usually accompanied by payment for placement of a message. This implies that advertisements are impersonal and are designed to reach a wide audience. Sometimes, this very aspect has been used to discredit the method of promotion. This is because messages delivered do not go directly to a target group but are received by everyone. This means that finances are not fully utilised. Another deficiency of this form of promotion is the fact that there are no instant reactions to advertisements. Advertisements stimulate buyers only after they have been around long enough. Despite these inadequacies, there are a number of benefits which advertisements provide. First of all, they allow companies to penetrate different market groups. They give products a lot of mileage especially when the advertisements are well done. Besides these, advertisements allow companies to break geographical barriers as companies can communicate to people who are miles away or even out of the country. Public relations are another aspect of promoting a company's image hence product. Public relations involve creating positive associations with the public through a number of communication pathways. This encompasses informing the public about a company through articles in the media. It also involves assessing media outlets for comments about products offered about a company or other issues concerning the company. It also involves supervising a crisis that could potential spoil the company's image. Companies must also promote goodwill among their target market through events, programs and charities for the community. Public relations are essential in marketing because it makes up the company image and builds the product too. There are a variety of advantages offered by PR that may not be available through other forms of promotion. The first is that PR offers additional details about a company compared to other promotions. For example, an article writing about a certain company in the papers could include other things which the company engages in thus educating consumers. PR is also important because most consumers think it is impartial. This is mostly because they assume that a given media outlet does not favour specific companies. Consumers would rather believe a given story about a company rather than read a full advertisement on a magazine. (Hunger, 2003) Conclusion Marketing is an essential tool for any company because at the end of the day whatever a company is making needs to be sold. Companies should engage in market research since it is a fundamental aspect of marketing. It helps marketers to determine what consumers need and then forge a way forward in regards to choices or improvements to be made. Besides these, there ought to be marketing management through market analysis and segmentation. All in all, if a company considers all the four Ps, then it will be on its way to achieving its objectives and providing optimum services to clients. References Grant, R.M. (2005): Marketing Analysis and marketing strategy; Blackwell Publishing Ltd., Oxford (U.K.) Hunger, J. D & Wheelen, T, L. (2003): Essentials of Strategic Management. New Jersey: Pearson Education Inc. McGahan, A. (2004): How Industries Evolve - Principles for Achieving and Sustaining Superior Performance". Harvard Business School Press, Boston, Porter, M.E. (1985): Competitive Advantage: The Free Press, New York, 1985. Read More