Marketing Mix for Solar Panel System - Case Study Example

Marketing Mix paper Introduction This paper defines the elements of the marketing mix and looks at how they are employed for a specific product, solar panel system. The marketing mix for the solar panel system is detailed with each element of the marketing mix analyzed and the nature of the product and service that it provides is described. Definitions Product: This means the combination of goods and services that a company offers to the consumers and in the market. Price: Price is defined as the amount of money charged for a product or service. It also means the value that is exchanged by consumers for the benefit that accrues from using the product or service Place: Place indicates the activities of the company that make the product available to the target consumers. Promotion: The set of activities that communicate the merits of the product and are designed in such a way to ensure the sales of the product Marketing Mix The marketing mix of a company comprises the 4 P’s as the blend of these elements. Once the company has decided on its marketing strategy, the company must develop a marketing mix based on these elements and with an eye on capturing market share. The marketing mix must be developed in such a way that the firm can meet the demands of the consumers and also influence the purchasing decisions so as to maximize revenue. The 4 P’s of the marketing mix are themselves made up of different marketing tools that the organization can employ. The marketing mix is thus a strategy aimed at market capture and leadership that is a combination of the elements and the factors for each. Tools in the elements The tools available within each P are: Product: Variety, Quality, Design, Features, Brand name, Packaging, Services Price: List price, Discounts, Allowances, Payment period, Credit terms Promotion: Advertising, Personal selling, Sales promotion, Public relations Place: Channels, Coverage, Assortments, Locations, Inventory, Logistics Solar Panel system A solar panel is a device that converts the energy from the sun into electricity or heat. Thus, a solar panel is a system for producing renewable energy. The product operates on trapping the energy from the rays of the sun and using photo voltaic cells between the layers of the panel produces an electric current that can be used to heat water or power any other device. The market for the solar panel The market for the solar panel systems is still in the nascent stage and a concerted marketing effort is required to grow and capture the market. Though there are a number of players in the market for solar panel systems, the demand for the same is yet to kick off in a major way. An effective marketing mix for the solar panel should concentrate on the selling proposition of “alternative” energy source. Solar panel – Marketing mix While we have discussed the theoretical definition of the marketing mix and the elements, in the next sections, we would look at how they relate to the specific marketing mix for a Solar panel system. Product The solar panel system is one of the products in the range of the solar heating and solar energy producing appliances. Currently, the demand for the solar panels is quite low despite the solar panel system being around for a long time. The features and the brand name of the product are important from the view of marketing the product effectively. The brand name of the product can be used to create awareness of the product in the local market. As noted above, the demand being low is due to the lack of awareness and the same can be rectified by an aggressive marketing campaign. The robustness of the product is another factor in the product component. The solar panel system has to be manufactured and quality controlled to achieve the desired quality of the product. After sales service is important as the solar panel system is a product that requires constant attention from the seller. The guarantee for the reliability of the product forms another element of the product component. The replacement of the photo voltaic cells as and when required should be guaranteed by the producer as well as the warranty for the same listed in the manual. Price The price of the solar panel system can be discounted for bulk orders and the incentives offered by the regulatory agencies who want to promote solar power can be utilized for providing a price that is attractive to the users. Since there are lots of incentives that are offered by the federal government for the usage of devices that run on solar energy, these can be utilized for the benefit of the consumers and the manufacturers alike. The main disadvantage of a solar panel system is the fact that the prices of the components are not cheap and as a matter of fact, the photo voltaic cells are expensive and with regulatory support, this can be overcome to a certain extent. The market is not price-sensitive as yet as the market is not fully mature. On the other hand, this can lead to buyers being put off by a high price for the product. Thus, the pricing of the solar panel system has to be done judiciously and keeping in view the different market segments. The target market segments can be divided into individual, bulk and institutional users. The individual users are the homes that need the solar panel for their heating needs. The institutional and the bulk users are the ones that require the product in large numbers. These can include colleges, corporates and other users who want the product in bulk. Thus, according to the segment of the market, appropriate marketing mix must be developed. The credit terms can be negotiated with the bulk users whereas for individual users, the payment can be taken in full. Promotion The awareness for the solar energy products is low. Thus, a concerted promotion strategy that takes into account the need to increase the awareness among the consumers must be developed. This includes advertising in all media avenues and with particular emphasis on trade journals to attract the institutional users. The individual users of the product can be contacted through personal selling. The federal agencies responsible for the promotion of solar energy products have a role to play as well. The promotion strategy should focus on the imperatives for solar energy as an alternative to the fossil fuels and other non-renewable energy sources. The unique selling proposition or the USP of the product should be on the focus of the solar panel system as a “clean” and cost-effective product for the energy needs of the users. Place This is the last element of the marketing mix. The tools that make up the place include the regions in which the product is marketed and the strategies for the same. As the solar panel system is a product that depends on the weather and the solar energy that is needed, the place element has to ensure that the product is marketed only in locations where there is plenty of sunshine round the year. It does not make sense for the product to be marketed in places that have inclement weather. In fact, this is one of the reasons the solar energy powered devices have not taken off in a big way apart from the fact that the prices of the components are expensive. Conclusion As we have seen, the solar panel system is a unique product, if marketed and utilized well can lead to a revolutionary and new way of energy production. The marketing mix for the same must enhance the features of the solar panel system while positioning the product in such a way as to ensure that the disadvantages are reduced through Notes 1. Kotler, Philip and Armstrong, Gary (2003) Marketing: An Introduction. Singapore: Pearson publishers. 2. Energy Trust website http://www.energytrust.org/meetings/rac/2003/030917/solar_marketing_plan.pdf> Retrieved on June 22 2008. 3. Pollick, Michael. How Do Solar Panels Work?. Wisegeek. Conjecture Corporation http://www.wisegeek.com/how-do-solar-panels-work.htm. Retrieved on June 22 2008. Read More