What Is Markeitng Essay Research Paper MARKETING1L1WHAT — страница 6

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distribution channel and the demand. 3.Legal regulations: this may restrict the choice of the middleman. Examples: 1- a company requests that a middleman only handle the company?s product line, it is called ?exclusive dealing contract?. 2- a company gives the wholesaler the sole right to sell the company?s product in a certain area, it is called ?exclusive sales territory?. 3- a company requests a middleman to take a slow product, to get another fast product. 4.Product characteristics: depends on the movement of the product, is it an fmcg or not, the technology level. 5.Company characteristics: a company just starting may have enough leverage to get its product exactable by wholesalers. Structure of a distributing system 1.Length of the channel: the shorter the channel is the

more the control is 2.Intensity of distribution: this depends on the nature of the product, it is sub classified in to: A-intensity distribution: sells in many out lets (super market, pharmacy), it is non-durable goods and frequently used. In this case you have less control on the price and display. B-selective distribution: you distribute your product in a limited number of out lets. Example for that is television and microwave (durable goods). C- exclusive distribution: the company grants middlemen the exclusive territorial right to sell their product in a certain area (some times for prestige image). 3.Selecting specific intermediates: you have to know if they can deliver your product to the final market at a reasonable cost, their size (known or unknown), financial resources,

experience, coverage, service level and delivery, reptilian, product expertise. Channel strategy 1.Push policy: pushes the product down to promote the product to the next level down the channel. Example for the push strategy is a new unknown company. 2.Pull strategy: you promote your product directly to the consumer to increase consumer demand, which pulls the product demand up. Example for the pull strategy is a well-known company like Procter and gable. the pull and push strategy Place: Pricing can determine the success or the failure of a product. The price must be consistent with the quality. ?What increased the importance of pricing? 1.Sharp recession: the recession makes the consumers more prices sensitive, because of the decrease in the purchase power. This makes price a

prime weapon in competing brands. 2.Foreign competition: competition creates a down wards force on prices. 3.Fragmentation (separation) of many segments: different segments demanding different price levels. 4.Deregulations: privatization and the government took its hand out, increased private sector intense price competition. ?Influential factors that determine price. 1.Market demand: the law of demand and supply. 2.Production and distribution cost: mass production enables producers to produce more products to more consumers cheaply. 3.Competition: you lower your prices to compete (availability vs. price). 4.Corporate objectives: prestige and positioning. Example L?Oreal (hair color), their slogan is ?because you worth it?. Price is influenced by corporate objectives. 5.Other

factors: segments, consumer income, supply and raw materials, government. Pricing strategy: 1.Competitive pricing This strategy is applied mostly in the fast moving consumer goods, as every food company in the world, they try to reduce the cost and sell cheaper. 2.Comparative pricing You show the consumer the regular price and the selling price. 3.Skimming pricing If you are the only one that produces a product, then you start with high prices to recover that start-up cost. After a time interval you reduce the price. 4.Penetration pricing Start with very law prices to penetrate the market quickly. Then after a time interval you higher your prices, example cigarettes, you create loyalty and traffic then higher the prices. 5.Promotional pricing ? Buy one get one free?, ?buy one

take two?. Most of the cases it happen to clean inventory. 6.Loss leader pricing (retail only) You advertise one product with very low price to create traffic in your store, and you sell another products. 7.Prestige pricing Example: L?Oreal, BTM, Marie laui. This is not competition on the basis of price. PROMOTION Definition of promotion: promotion is a combination of communication strategies to convey brand benefits (information) to customer (target audience) and influence to buy. Objectives of promotion: 1-To create awareness: especially for new products, or an old product as a particular new aspect. 2-Stimulating the demand: 1)Primary demand for the whole category, sometimes it occurs with old products to simulate the category demand, with out a specific product. The