09-11-2012, 05:17 PM
Marketing Mix
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Introduction
The basic task of marketing is the delivery of product(s) to consumers
so that their needs are fulfilled and organisational objectives are also
achieved. This involves several important decisions, e.g. deciding about
the product or products which should be offered for sale, price of the
product, markets where products may sell and the means of
communication with the consumer for the sale of the product. All these
decisions form part of marketing-mix. In this lesson we shall study
about the concept of marketing mix, its components and the relationship
among various components of marketing mix
Product
Product refers to a physical product or a service or an idea which a
consumer needs and for which he is ready to pay. Physical products
include tangible goods like grocery items, garments etc. Services are
intangible products which are offered and purchased by consumers.
Services may involve also an innovative idea on any aspect of operation.
Products is the key element of any marketing mix.
Internal factors :
Internal factors, affecting the price of a product, are many. Cost of the
product sets the floor. Any company would like to charge a price
which covers the cost of the product and a fair rate of return.
Cost of the product means total cost i.e., fixed plus variable costs.
Fixed costs do not change with the change in volume of production
upto a certain level. Variable costs change proportionately.
External factors
Besides internal factors, external factors also influence the pricing
decision of a company. These factors are called environmental factors.
Nature of demand, competitors’ costs, price offers and government
policy are very important factors to be considered while fixing prices.
The relationship between price and demand should be analysed properly.
No company can ignore the costs, prices and offers of substitute items
from competitiors. Economic factors, like rate of interest, state of
industry (boom or recession), inflation, etc. affect the price-fixing
decision. In case of certain products, e.g. products which fulfil basic
needs, government may impose price control. Thus, it would also affect
price of the product.
Tools of Promotion-mix
Advertising, personal selling, sales promotion and publicity are the
major tools. The marketing manager must recognise the characteristics
of each tool and costs involved while deciding on the promotion-mix.
Advertising
Advertising is an impersonal form of communication for which the
seller pays in order to promote a physical product or service. It may
be in print form as in newspapers and magazines, or in audio form as
on the radio and other similiar methods, or in audio-visual forms as on
the Television, cinema screen, etc.
The merits of advertising is that it reaches a larger number of people,
the message can be repeated, its cost is not high, and with the
development of art and computer graphics, simple statements can be
transformed into forceful messages.