“What is marketing?” At the beginning of each term, I pose this question to my undergraduate marketing students.
Their answers are diverse:
– “It is the process of selling your product.”
– “It is how to advertise your company.”
– “It is the study of how to give your company a brand that others will recognize quickly.”
– “Today, marketing is centered on how to promote your company online through social media, search engine optimization, blogging, website development, creating apps, and other technological tools.”
– “Marketing is about building relationships with your clients.”
All of these answers focus on promotion. While promotion is a vital part of marketing, our responsibilities extend far beyond this single component. Today, we’re going to explore other factors of marketing.
Determine Needs & Desires
The first step in marketing is to segment the market—divide it into groups with shared needs and desires. To accomplish this, we examine:
Demographics
– Age
– Gender
– Education
– Income
– Occupation
– Geographic Location
– Cultural Background
Psychographics
– Values
– Interests
– Attitudes
– Beliefs
– Personalities
After identifying the market segments, we develop a product or service that meets the needs and desires of one of more of these groups—a process that we call target marketing.
Predict Demand
In this step, marketers predict the products and services that consumers will want or need in the future. We ask questions like:
– Will consumers purchase this product?
– How many units will consumers purchase?
– How often will they purchase this product?
– What historical trends do we have, and what purchase rates can we project from them?
– What external factors might increase or decrease purchase rates in the future?
After we predict what consumers will want in the future, we can work with our product design and manufacturing teams to create new products, or modify our existing products to accommodate consumer demands.
We can also predict the number of units we should make to meet demand.
Identify Competition
We identify competitors by finding companies that are providing similar products or services. Some of the questions we ask are:
– Which companies are making similar products?
– What is the price for these products?
– How many units are they selling, and to whom?
– What are consumers saying about their products?
As we learn about our competitors’ strategies, products, services, and consumer response, we can develop a plan to successfully compete against them.
Plan Market Entry
In our market entry plan, we determine how we will distribute our products or services to our target market. The questions we ask include:
– When is the best time to start selling our products?
– How many product units will we be able to sell initially?
– What licenses or approvals will we need to sell our products?
– What alliances or partnerships will help us to successfully reach our target market?
– In which stores or online venues should we sell the product?
-What risks will we incur?
The market entry plan is important for establishing a process, communicating that process to our team, and avoiding risks. It will also help us to select the best option for entering the market, as well as help us to avoid mistakes that will cost us time and money.
Calculate Pricing
Of course, all of our hard work is meaningless if we do not set a price that is high enough for us to make a profit, yet low enough that consumers will purchase the product. Setting a price can be challenging; the questions we ask include:
– What price can our consumers afford?
– Can we make a profit for the company at this price?
– At this price, can we compete with our competitors?
– If our prices are higher than our competitors’, can we create “value-addeds” that will make us more attractive?
– Is it important that the customer buy from us more than once, or do we want to maximize our profit for each transaction?
– Can we adjust our product line or quality to meet the needs of consumers who are price sensitive, as well as those who aren’t?
– Will we offer free or discounted products, and if so, how will we offset this financial loss?
Selecting the right price for our products and services is one of the biggest and most difficult marketing decisions—especially if you are offering a brand new type of product or service. Consumers must first be educated about the product, and the price must be low enough that they are willing to try something new.
Develop Promotional Plan
Whether we are launching a brand new product type or promoting a product that is widely available, we must decide how we will promote it. This is what most people think of when we tell them we are marketers: it includes our advertising, social media, publicity, etc. In the promotional plan, we decide how to tell consumers about our product.
– What are our sales and revenue goals?
– What metrics will we use to determine success?
– What is our core message?
– What image do we want to portray?
– What does our target market know about us?
– What marketing channels and tools will we use?
– When and how will we implement our selected tactics?
To learn more about promotional plans, refer to my article from September 9.
Provide Service
Finally, we examine the type of customer service that our consumers will require, asking questions such as:
– What types of problems could the customer experience?
– What training will our customers need to successfully use this product?
– How will our customers access our customer service department (phone, online, in person)?
– What internal service standards will we establish?
Poor customer service will destroy customer loyalty very quickly, while exceptional customer service will encourage consumers to continue to purchase our products and refer others to our business.
As you can see, there are many aspects involved in marketing. Be sure to work closely with your expert advisors to determine the best path for your company.
Hope Wilson, CPSM, is president of Wilson Business Growth Consultants, a firm that provides international business strategy and communications services. Specializing in infrastructure development, Hope has received 12 international awards for her work. Have a question about marketing? Email: [email protected]
