DETERMINING THE EMPHASIS WITHIN THE MARKETING MIX

 

In reality, a marketer must decide on the appropriate market mix, that is, what emphasis should be placed on each of the marketing elements to create a unified marketing strategy - the combination of elements will depend on the following factors.

·                vision, objectives, and resources of the business

·                unique characteristics of the target market

·                present and future economic conditions

·                the amount, or degree of competition in the market place

·                the stage in the life cycle of the product

·                competitor’s marketing strategies

·                budget allocation for the marketing strategy

·                the product itself.

THE IMPACT OF THE PRODUCT LIFE CYCLE ON THE MARKETING MIX

 

New technology, variations in consumer tastes, fluctuations in the level of economic activity and shifts in consumer habits means that the market in constantly changing.  Because of this, the marketing of a new product must be carefully planned and managed.

Marketing strategies also need to be assessed and changed depending on stage a product is at within its life cycle.  Businesses need to be able to launch, modify and delete products in response to changes in the products life cycle.  There are five stages to a product’s life cycle, and each stage will require a different marketing mix.

1.      Introduction stage.  At this stage, a business needs to set a price to attract its target market; promote heavily; encourage association with a brand name; and set up appropriate distribution channels.

 

2.      Growth stage.  At this stage, a business needs to encourage brand loyalty; strengthen the products position; differentiate its product as competition increases; develop new market segments; offer discounts; broaden their distribution network; and emphasis customer service.

 

3.      Maturity (saturation) stage.  At this point in the product life cycle, a business needs to redesign packaging; offer reduced prices, incentives and markdowns; come up with new promotion strategies; have aggressive personal selling; and look at the possible abandonment of the product.

 

4.      Decline stage.  At this stage, a business needs to lower the price to reduce inventory; narrow distribution channels; reduce promotion efforts; and eliminate the product

 

5.      Regrowth stage.  At this last stage, a business needs to redesign its initial advertisement; increase promotion; and encourage brand recognition.

One strategy often used to promote the life of a product is to keep updating/changing advertising so that the product is kept ‘fresh and alive’. 

As all products eventually follow the path of the life cycle, a business must continually develop new products.  However, developing and introducing new products is time consuming, expensive and risky.  Research suggests that over 70% of all new products fail after being launched into the market.

Product Strategy

 

Before a new product is introduced onto the market, it goes through five stages.

 

1.      Idea generation:  this involves coming up with a new idea for a product.

 

2.      Screening:  the ‘good’ ideas are sorted from the ‘bad’. Those ideas that match the business’s objectives and resources are accepted and the others are rejected.

 

3.      Financial analysis:  those ideas that have been accepted are costed.  Projections of expected costs, sales and profitability are calculated.

 

4.      Product development:  At this stage the product begins to take shape.   Research and development construct and test a prototype.

 

5.      Test marketing:  Through limited sales, the product is tested against customer’s reactions.

This process, however, does not guarantee success of a product.  In fact, many new products do fail, even though they have gone through such a process and the resulting product is technically superior to that of its competitor.