BizKids 4 P's of Marketing PDF

Marketing Mix and Product Mix

First identify your product mix.  All the different products and services make up your product mix.  You should select the Product Features like color, size, or quality.  For a service business you need to select the hours, warranty, delivery, and installation.  It is imporanta to select the right features based on your target market.

Branding, Packaging, and Labeling

Make it stand out with the way you brand and package your product.  Branding is the name, symbol or design used to identify your product or service. Package is the box, container, or wrapper used to hold your product.  The label is the information about your product written on the package.

Position Your Product or Service

How do you want your customers to see your product.  Both Jaguar and Hyunda are both car companies with totally different position in the market.

Pricing the Product or Service

There are many ways to set the price of a product. Price should be set high enough to get a profit but low enough that customers will purchase the product. There are 3 ways to think about it.

  1. Demand pricing is based on what people are willing to pay.
  2. Cost pricing is based on what the item actually costs to make.
  3. Competition pricing is based on the pricing based on your compeditor's pricing.

For Service Businesses there are 2 basic price structures:

  1. Time Based pricing is based on how much time it takes to do the service.  Many plumbers, auto mechanics, taxi cab drivers all base their fees on how much time it takes.
  2. Bundle Based pricing is when a service business bundles different jobs together to make one price.  You might walk a neigbor's dog, give it a bath, and board the dog overnight for one fee.

 

Pricing Techniques

Price skimming is when a new product is developed and a very high prices is charged at first to recover the research costs involved in bringing it to market.

Penetration Pricing is when very low pricing is introduced so that it will help build customer loyalty to purchase your product or service.  This also discourages competitiors from entering the market.

Psychological Pricing

Prestige Pricing - High prices are placed on an item to make the item look prestigious.

Odd/even Pricing - Bargin verse quality pricing.  Many businesses will put $29.99 vers $30.00 on the tag. The $29.99 would make people think they are getting a bargin where the $30.00 price seems like the item has high quality.

Price Levels - Low, medium and high prices based on factors about your product or service.

Promotional Pricing - This is typically low prices for a specific time period.

Multi-Unit Pricing - this is pricing when your can get 10 for $1 or buy 3 get one free.

Discount Pricing - This is for items that are marked down 50% off.

Quantity Discounts - Prices are set to when you buy one get one free.

Seasonal Discounts - Most things go on sale after the season like bathing suits in winter or Christmas lights the day after Christmas.

Distribution and Promotion

There are 2 Channel Options
1. Manufacturer to consumer.  This channel offers the lowest cost and higher profits for the business however there might be a limited sales opportunity.  This could be achomplished by having a web based business and directly mailing your product to consumers.

2.  Manufactuer to Retail:  This chanel offers your product through different stores and allows for wide spread sales but at a lower profit since the store will need part of your profits.

Physical Distribution

Transportation-

Product Storage and Handling.  When you have inventory this will add to the cost and risk of having the products go bad, stolen or just not to sell.

Promotional Mix

Advertising should clearly communicate your message.

Marketing Mix and Product Mix

First identify your product mix.  All the different products and services make up your product mix.  You should select the Product Features like color, size, or quality.  For a service business you need to select the hours, warranty, delivery, and installation.  It is imporanta to select the right features based on your target market.

Branding, Packaging, and Labeling

Make it stand out with the way you brand and package your product.  Branding is the name, symbol or design used to identify your product or service. Package is the box, container, or wrapper used to hold your product.  The label is the information about your product written on the package.

Position Your Product or Service

How do you want your customers to see your product.  Both Jaguar and Hyunda are both car companies with totally different position in the market.

Pricing the Product or Service

There are many ways to set the price of a product. Price should be set high enough to get a profit but low enough that customers will purchase the product. There are 3 ways to think about it.

  1. Demand pricing is based on what people are willing to pay.
  2. Cost pricing is based on what the item actually costs to make.
  3. Competition pricing is based on the pricing based on your compeditor's pricing.

For Service Businesses there are 2 basic price structures:

  1. Time Based pricing is based on how much time it takes to do the service.  Many plumbers, auto mechanics, taxi cab drivers all base their fees on how much time it takes.
  2. Bundle Based pricing is when a service business bundles different jobs together to make one price.  You might walk a neigbor's dog, give it a bath, and board the dog overnight for one fee.

 

Pricing Techniques

Price skimming is when a new product is developed and a very high prices is charged at first to recover the research costs involved in bringing it to market.

Penetration Pricing is when very low pricing is introduced so that it will help build customer loyalty to purchase your product or service.  This also discourages competitiors from entering the market.

Psychological Pricing

Prestige Pricing - High prices are placed on an item to make the item look prestigious.

Odd/even Pricing - Bargin verse quality pricing.  Many businesses will put $29.99 vers $30.00 on the tag. The $29.99 would make people think they are getting a bargin where the $30.00 price seems like the item has high quality.

Price Levels - Low, medium and high prices based on factors about your product or service.

Promotional Pricing - This is typically low prices for a specific time period.

Multi-Unit Pricing - this is pricing when your can get 10 for $1 or buy 3 get one free.

Discount Pricing - This is for items that are marked down 50% off.

Quantity Discounts - Prices are set to when you buy one get one free.

Seasonal Discounts - Most things go on sale after the season like bathing suits in winter or Christmas lights the day after Christmas.

Distribution and Promotion

There are 2 Channel Options
1. Manufacturer to consumer.  This channel offers the lowest cost and higher profits for the business however there might be a limited sales opportunity.  This could be achomplished by having a web based business and directly mailing your product to consumers.

2.  Manufactuer to Retail:  This chanel offers your product through different stores and allows for wide spread sales but at a lower profit since the store will need part of your profits.

Physical Distribution

Transportation-

Product Storage and Handling.  When you have inventory this will add to the cost and risk of having the products go bad, stolen or just not to sell.

Promotional Mix

Advertising should clearly communicate your message.

 


This site was created by Roderick Hames
for the primary purpose of teaching and demonstrating computer & business skills..
Any distribution or copying without the express or written consent of
Alton C. Crews Middle School or its creator is strictly prohibited.
***
Any questions, comments or suggestions concerning
this simulation or this handbook should be forwarded to
Roderick Hames, Computer Science / Business Education Teacher
copyright ©1997-2014, last updated November 05, 2016 Alton C. Crews Middle School: CS Dept