business strategies

• Marketing strategies


  Aim to increase brand awareness and achieve their marketing objectives
• Marketing strategies


  • Market segmentation
  • Product/service differentiation
  • Positioning
  • Product
  • Price
  • Promotion
  • Place
  • People, processes, and physical evidence
  • E-marketing
  • Global marketing
• Market segmentation


  Dividing the total market into segments, to choose one as the target market
• Main segmentation types


  • Demographic (features, age, sex, income, culture)
  • Geographic
  • Psychographic (personality traits, socioeconomics lifestyles)
  • Behavioural (relationship with product)
• Product/service differentiation


  Makes products seem different from competitors to gain control over the market, especially price
• Types of differentiation


  • Customer services
  • Environmental concerns
  • Convenience
  • Social/ethical issues
• Positioning


  Create an image about the product against competitors
• Demographic segmentation


  • Happy Meals appeal to young children
  • Mcafe appeals to adults
• Psychographic segmentation


  • Provides options for Muslims, Hindus, and Catholics with halal and kosher options, along with 'fillet of fish' for catholic who don't eat meat on Fridays
• Mcdonalds's Gained bad publicity in terms of health with their supersize portions, thus removing it
• Branding


  To identify a specific product/business, distinguish from competition
• Benefits of branding


  • Distinguish
  • Provide psychological rewards, like prestige or status
  • Repeat sales
  • Encourage customer loyalty
  • New product introduction
  • Carry over effect for new products
• Packaging


  Development of both product's container and graphic design
• Benefits of packaging


  • Preserve product
  • Positive impressionism
  • Transportations
  • Attract customers
• Labelling


  Presentation of products/packaging's information- ingredients, operations, shelf life, country of origin
• Brand recognition


  • 88% of people could identify the "golden arches" logo, compared with 54% that can identify the Chritian cross
  • Synonymous with economic favourites like the Big Mac and French Fries
• Price


  Amount of money a consumer is willing to pay for a product
• Pricing methods


  • Cost based pricing
  • Market based pricing
  • Competition based pricing
• Cost based pricing


  Cost of production + additional costs x markup percentage= price
• Cost based pricing is used by wholesalers and retailers
• Cost based pricing is difficult to accurately price (too high, won't sell, too low, unneeded profit loss)
• Market based pricing


  Pricing based on levels of supply and demand
• Competition based pricing


  Pricing based on competition with similar products
• Competition based pricing strategies

  • Below competition- undercutting competition, break into established markets
  • Equal- avoid market research on consumer pricing needs
  • Above- seen superior, appeal to status-conscious consumers
• Pricing strategies


  • Skimming
  • Penetration
  • Loss leaders
  • Price points
• Price skimming


  Highest possible price for product, establishment stage. Prestige and status for consumer, gain high profits when demand is strong
• Pricing penetration


  Offering lowest possible price to achieve large market share for product (short-term)-mass marketing pricing
• Pricing penetration is difficult to raise prices, locked into low sales revenue
• Loss leaders


  Prices below cost price to attract customers to business, low price image, for overstocked/slow products
• Loss leaders done incorrectly can lose money
• Price points


  Predetermined prices, retailers and clothing stores use to limit key prices and encourage consumers to buy more expensive products
• Loss leaders


  • Loose Change Menu - appeal to value-conscious customers
• Price and quality relationship


  Based on the perception of products's production cost. Low price-'low quality', 'cheap', value conscience consumers. High price-high quality, prestige, wealth, attract status-conscience consumers
• Promotion


  Methods to inform, persuade, remind the target market of a product. Attract new customers, encourage existing ones, reinforce brand image
• Promotion mix elements


  • Advertising
  • Personal selling and relationship marketing
  • Sales promotion
  • Publicity and public relations
• Advertising


  Paid, non personal, message communicated through a mass medium to increase sales and business profit
• Advertising media


  • Mass marketing (television, newspapers)
  • Marketing catalogue (mail to households)
  • Telemarketing (telephone use to contract consumers)
  • E-marketing (use of internet)
  • Social media advertising (use of social media platforms)
  • Billboards
• Advertising choice is based on product type, business budget, medium cost, life cycle position
• Advertising


  • Spends $4b / year
  • Uses TV, Billboards, social media
  • Sponsors sports team e.g. FIFA World Cup
• Personal selling


  Sales consultant, direct to consumer, human aspect of promotion