The document discusses various aspects of marketing mix and its elements - product, price, place, promotion and additional element of people. It provides details about each element, including factors to consider for product planning, levels of products, pricing procedures and strategies, distribution channels, various promotional tools, and importance of employees in service industry. The marketing mix is a set of controllable variables that can be used to influence customer response. Each element requires strategic decisions for effective implementation of marketing plans.
2. MarketingMix
• The term ‘marketing mix’ first appeared in the article entitled ‘The Concept of Marketing Mix’ (1948)
written by theorist Neil Borden, a professor of marketing and advertising at Harvard Business School.
• In 1960, Professor Jerome McCarthy developed Borden’s theory and kept four main points, namely
the 4 P’s (Product, Price, Place and Promotion) in his book Basic Marketing: A Managerial Approach.
• According to Philip Kotler “Marketing Mix is the set of controllable variables that the firm can use to
influence the buyer’s response”.
• The constituents of marketing mix are said as marketing mix elements. Elements are also referred
as decision variables.
• Marketing mix consists of mainly four elements, referred to as “4 Ps”
• Each element is also referred as mix, for example, product mix, price mix, promotion mix, and
place mix.
• Each mix contains a set of decisions.
4. Marketing Mix- Product
• anything that can be offered to a market that might satisfy a want or need.
• a bundle of benefits which a marketer offers to the consumer for a price.
• includes product –
• planning,
• development,
• design,
• mix,
• innovation, standardization and branding.
• According to William J. Stanton “Product is a set of tangible and intangible attributes (packaging,
colour, price, manufacturer’s prestige, retailer’s prestige and manufacturer’s and retailer’s
services) which buyer may accept as offering satisfaction of wants and services”.
• According to Alderson, W., “Product is a bundle of utilities consisting of various product features and
accompanying services”
7. Levels ofProduct
1.Core Benefits: ex.the core benefit in a hotel is to provide place to rest or sleep when away from home.
2.Basic/ Generic Product: ex- in a hotel, this could mean a bed, towels, a bathroom, a mirror, and a wardrobe.
3.Expected Product: Ex-clean sheets, some clean towels, Wi-fi, and a clean bathroom.
4. Augmented Product: any product variations, extra features, or services that help differentiate the product
from its competitors. Ex-free map of the town in every room, room for the driver, some sort of entertainment
facilities ( Live orchestra, exclusive arrangements for loyal customers, refrigeration for certain items, locker facility,
personal attn)
5.Potential Product: all augmentations and transformations the product might undergo in the future. In simple
language, this means that to continue to surprise and delight customers the product must be augmented.
In this example of a hotel, this could mean a different gift placed in the room each time a customer stays. It could be
some chocolates on one occasion.
9. Thelife cycle of a product is associated with marketing and management decisions within
businesses, and all products go through five primary stages:
1. Development
2. Introduction
3. Growth
4. Maturity
5. Decline
Each stage has its costs, opportunities and risks, and individual products differ in how long
they remain at any of the life cycle stages.
10.
11.
12. MARKETING MIX – PRICE
• Price is the amount charged for a product or service.
• It can be defined as the economic value of product normally expressed in form of money.
• It is one of the most important elements in the marketing mix. Fixing the price of the product is a
tricky job.
• Many factors like-
• demand for a product,
• cost involved,
• consumer’s ability to pay,
• prices charged by competitors for similar products,
• government restrictions etc. have to be kept in mind while fixing the price.
• In fact, pricing is a very crucial decision area as it has its effect on demand and profitability of
the firm.
• The price of product should be set in such a way that buyers can pay and company can earn
adequate profits.
13. Marketing Mix- Price
• Balance between price-sensitive and prestige-sensitive customers.
• Price mix includes the decisions regarding:
• Manufacturing (variable and fixed) costs of the product
• Pricing policies and strategies of the close competitors
• Pricing policies and strategies at different stages of product life cycle
• Terms of credit to be allowed to customers.
• Margin of profits
• Identifying and analyzing various relevant factors influencing
decisions
14. Marketing Mix- Price
• Factors determining a company’s price decisions can be categorized as internal
factors and external factors:
• Internal factors include-
• company’s marketing objectives,
• marketing mix strategy, and costs
• External factors consist of –
• market environment,
• demand,
• competition
15. Procedure (Steps) for Setting Prices
1. Set pricing objectives
2. Estimate demand
3. Determine costs
4. Examine the pricing environment
5. Choose a pricing strategy
6. Develop pricing tactics
16.
17. PLACE :
Factors affecting-
CHOICE OF LOCATION
Nature of service
(standardized, Customized)
Nature of interaction
(high & Low contact)
Customer’s needs and wants
Natural geographical location
Competitive positioning
Technological advancement
Dependency on other services
Infrastructure facilities
Target market decisions
LOOK OF THE PREMISES
Nature of objective of the service firm-
(Profit, Mkt share, Image, Customer satisfaction, Sales)
Flexibility to accommodate future needs-
(Resources- Space, Personnel, technology, tangible evidence
Aesthetic factors-
( Look, shape, Design, Layout etc.)
Social environment-
( Ambience, accessibility, target customers, Customer compatibility etc.
19. CHANNELS IN SERVICE DELIVERY
They are as follows – Agents & Brokers, Electronic Media, Franchising
Agents & Broker
s
Electronic channels Franchising
20. •The task of Promotion is to target customers and Communicate with them
•An integrated mix of promotional techniques should
reach customers by all available channels
(Personal contact, relationship enhancement, Cross
selling)
Promotion
Promotional Mix
Advertising
Public
Relations
Sales
Promotion-
Personal
Selling-
PC,RE,CS
Direct
Marketing
Internet/
E-commerce
21. Vital role in communicating positioning of service to customers
Adds significance to services, adds tangibility , helps customer in better evaluation of service offer
Customer in services relies more on subjective impression more than concrete evidence
customer is likely to judge quality of service on the basis of performer rather than actual service.
buying service is riskier proposition as customer cant sample the service and evaluate quality of service.
Six guidelines for service advtg applicable to most elements of communication mix .
Provide tangible cues
service understanding
Communication continuity
Promising what is possible
Capitalising on word of mouth
Direct communications to employees
23. PEOPLE
added as 5th element by Judd in 1987
stressed upon internal marketing
Gronroos-(objective of int mktg is to develop motivated & consumer conscious employees)
recognizes the importance of attracting, motivating, training, retaining quality employees
efforts put overall will enhance the service company’s competitive performance
provide training programs for highest form of customer care
Development of quality circle, empowerment and a service culture organisation all prove the above.
In services, marketing is everyone's job.
it is important to have employees with skills, commitment, attitude and ability to use discretion in dealing with
customers
especially true, in those services where there is a high level of contact with customers
By adding value in the way the employees perform and by maximising the impact of their activities, the firm has a
competitive edge over the other service companies
24. IMPORTANCE OF HRM IN SERVICES
1. Customer pull and maintenance
2. Building the corporate image
3. Sustained organizational performance
DIFFERING ROLES OF PEOPLE :
25. TYPES OF SERVICE PERSONNEL
A. Level of interaction
i. High contact personnel (hospitals, schools , colleges)
ii. Low contact personnel(retailing, post office)
B. based on skill and expertise
i. Skilled professional (doctors, lawyers, CAs
ii. Non- professionals(waiters, delivery boys)
C. Frequency & length of customer interaction
i. contact personnel
ii. moderate contact
iii. Back office staff
iv. Support staff
v. Management
26. Complex combination of strategies is required for the service employees to deliver quality
service.
These include-
i. Hire the right people- internal & external sources- right & best people
i. Competencies- skills & knowledge to perform the job
ii. inclination- interest and right attitude
ii. Develop people to deliver service quality- initiated into work culture(orientation), socialising,
training, empowerment
iii. Provide needed support system- co-workers, supervisors, management- emotional , communication,
technological, rewards & appreciation
iv. Retain best people – treat them as customers, include employees in vision, visibalize their
contribution, rewards, evaluation & feedback
27. PROCESS
Designing the process:
a) The service itself
b) Customer participation
c) Degree of customer contact
d) Degree of divergence
e) Location of service delivery
f) Complexity of service
Service process planning- design elements
Basic technological decisions
Conversion/ Materials decision
Specific equipment decision
Process flow decision
a. Line/ flow
b. job shop
People decision
29. SERVICE MAPPING
Its a technique used to portray an existing service situation and provides a useful
tool to assess and identify service opportunities
process of service delivery, role of customers and employees, visible elements of
service are displayed
provides greater attn to customer interaction
provides visual representation of service
must be read horizontally from left to right to understand the steps to be
performed by customers/ service employees
must be read vertically to understand the structural relationships existing to
support actions of customers and employees
31. ELEMENTS OF BLUEPRINTING
Customer role
Support processes
Technology
Conversion process
Equipment
Flow of process
Service personnel
Service location
32. PHYSICAL EVIDENCE
all the efforts taken by service provider to tangibilise their services
It includes-
physical facilities
Essential evidence ( technical facilities)
peripheral evidence (brochure, stationary)
physical environment (Servicescape)
Ambience
Space
decor & artifacts
Social settings
appearance of service personnel
33. Benefits of offering physical evidence
Increased productivity
creating good impressions
increased credibility
Differentiation from competitors
Service quality mgt
Re-positioning service
34. BRANDING
is difficult in services as it needs maintenance of consistent service quality
co. should create good brand image & a strategy to achieve it is to develop a theme in totality by –
including a tangible good as a part of brand image ( LIC- lamp between two hands, Times group-Two
elephants )
tie in a slogan with the brand ( Fedex- The world on time, LIC- In the service of the people)
Use distinctive colour ( Jet airways- blue and yellow)
Significance of branding is on rise in services as-
proliferation of brands
retention is easier than to attracting new customers
it tangibilises the service
cos resort to brand building to- 1) Maximize market capitalization 2) Wealth maximization
Ex. Professional firms are known based on corporate name & reputation (rather than service)
reinforced by employees
Success of service image is determined by quality
35. CHALLENGES FACED BY SERVICE MARKETER WHILE BRANDING SERVICES
Intangibility, Commoditization, complexity, inconsistency, real time consumer interactions are common challenges
Cant be stored
Cant be patented
Can’t be mass produced
Cant be displayed due to intangibility
Difficulty in pricing service brands
Employees may affect brand outcomes
Customer’s participation may lead to variations in outcome
Satisfaction is influenced by expected and perceived behavior of service provider and customer.
Quality of service depends on uncontrollable factors`
Heterogeneity of services leads to difficulty in delivering promises
Fluctuations in demand causes problem in branding.
36. Solutions to branding problems-
Create a consistent online identity- across multiple platforms consistent social network profiles, domain
name extensions
create a digital destination- personal website
Create and share valuable and compelling content in subject area and share it through blogging
Engage with social channels- advertise what is being used and manage tools & social engagement
Engage through emails- create, manage email lists, share recent blogs with subscribers, promote biz
Create images- for designs
Use online tools- wider reach through larger database of resources, specialist agencies etc.
Actively remind people- keep shouting- invest in areas giving you good returns, blogging to gain public
access to thoughts, passions and values
Create brand identity- creating recognition by evaluating platforms, identifying right avenues
Create gateway content- state of impartial advice reader potential customer brand advocacy
