Businesses have to sell what they product in order to make a profit and survive, break even or make a profit.
It is the role of the marketing department to increase the number of goods sold if
a business wants to be successful it needs to provide products and services at a price that most people are willing to pay.
Here are some of what the marketing department has to do:
Carry out market research into what consumers want from a product or service. This will help the business deiced what changes need to be, made to existing services or goods. This information can be used as a guideline for a new product to go on the market.
Where they are going to sell the product. This is very important as if you were going to set up an ice cream shop you are not going to build it in Alaska or any other cold place as it would be hardly ever used and therefore would be a complete waste of money and time.
Decide what price your product is going to sell at.
Decide what is the best was to advertise and promote the product.
This is called the marketing mix or the 4 P’s (price, place, product, promotion). For example a well designed and produced product that is greatly advertised will not sell if the asking price is too high. Marketing is important because there is much choice in services. A good product, which is poorly marketed, will not sell.
The 4 P’s:
Product:
Is there a market? (Will people buy it?)
The right design
The right style
The right packaging and customer support
Price:
How much will the people pay?
Production and distribution costs
How much profit in each sale?
Pricing is influenced by competitors
Low price is = more competitors
Low price –compete in low cost segment of market
All plastic design = low production cost
Place:
Product positioned in the market as a style icon:
Nike shoes – high quality product
Production costs – low
Point of sale price - high
Product has high mark – up / profit margin
Promotion:
Telling people about the product & getting them to buy it
Ultimate aim to establish a strong brand
Customers will seek out the brand and pay more for it