Marketing Mix

Prof. Ravi J
MARKETING MIX
The Marketing Mix
(“The Four P’s of Marketing”)

Marketing Mix
Define the Market

Product Channel
Segment
the Market, of
Choose attractive Distribution
segments Price

Design a
Marketing Mix Place
to Appeal to the
Target
Promotion

Position Your
offering
 Marketing Strategy
Product Price
Variety List price
Design Discounts
Features Allowances
Brand name Payment period
Packaging
Target Credit terms

customers
Promotion Place
Advertising Channels
Personal Selling Coverage
Sales Promotion Assortments
Public relations Locations
Inventory
Logistics
What is Product
A product is one which satisfies the needs of customers.
A product is anything that can be offered to a market for attention,
acquisition, use or consumption that might satisfy a want or need.
(Philip Kotler)
 Classification of Products and Goods
 Industrial Goods: Capital goods, Raw materials, component parts. E.g.
Machine Tools, iron ore, turbine etc.
 Consumer Goods: Are three types-

 Convenience Goods: which are bought frequently,

immediately, with minimum shopping efforts. E.g. Food
items, soaps, biscuit etc.
Staple goods: Milk, bread, newspapers.
Impulse goods: goods purchase without prior intention.
e.g. Chewing gum, magazines, etc.

 Shopping Goods: purchase only after a careful

comparison –suitability, quality, price, style. E.g. Clothes,
furniture, household appliances, fans etc.
 Specialty Goods: Goods with unique characteristics or
brand identification and purchaser make a special
purchasing effort.
Often customers are unwilling to substitute these products
for other related products.
E.g. Rolex Watch, original painting by Picasso, a Rolls-
Royce car, etc.

Unsought Goods: Product which are required in the face of

uncertainties or problems are known as unsought goods.
E.g. Umbrella, repair services. etc.
Consumer-Goods Classification
Convenience Products
Shopping Products
Buy frequently &
immediately Buy less frequently
> Low priced > Gather product
> Many purchase locations information
> Includes: > Fewer purchase locations
• Staple goods > Compare for:
• Impulse goods • Suitability & Quality
• Emergency goods • Price & Style

Specialty Products Unsought Products

Special purchase efforts New innovations
> Unique characteristics > Products consumers
> Brand identification don’t want to think about.
> Few purchase locations >Require much advertising
& personal selling
Product Attributes
 It involve deciding the quality, features and design
of the product.
 Product quality:- Ability of product item to perform its
intended functions such as durability, reliability,
precision (accuracy), performance, and ease of
operation.
 Product Features:- Offer a range of necessary features,
that consumer would expect to see in the product.
Helps to differentiate from competitors.
 Product design: Indicates its usefulness as well as makes
it attractive, distinguish because of unique style or
design which helps to create personality.
 Product Policies
 Product policy is that which guides the activities of a
firm and is measured not only with the current profits,
but also with the long life of the firm.
Product policy is concerned with defining the type,
volume and timing of the products a company sales.
It covers objectives and guidelines, which determine the
nature of the product or services, to be marketed.
 Product policy, generally covers the following:

 Product Planning and Development.

 Product levels
 Product line
 Product mix
1.Product planning and development
 Product planning means “an attempt to
establish the product in line with market
needs”. It includes-
 Evolution and introduction of new product.
 Bringingalternations in the existing lines to suit the
requirements of the market.
 Elimination of marginal or unprofitable products.
 The product planning and product development
include the decision-making of the following:-
 Which products should the firm make and which should
it buy?
 Should the company expand or simplify its line?
 What new uses are there for each item?
 What brand, package and label should be used for each
product?
 How should the product be styled and designed; and in
what sizes, colours and materials should they be
produced?
 In what quantities should each item be produced?
 How should the product be priced?
2. Product Levels
Potential product

Augmented product
Expected product
Basic product
Core benefit
 Product level
 Core benefit or product: It explains the reasons for which the customer is
making the purchase. E.g. Hotel customer is buying the concept of “Rest and
Sleep”.
 Basic or Generic Product: Marketer has to turn the core benefit to a basic
product. E.g. Product for hotel include bed, toilet, towels.
 Expected Product: Marketer prepares an expected product by incorporating a
set of attributes and conditions, which buyers normally expect when they
purchase this product. e.g. 24 hrs hot water.
 Product level
 Augmented product: Marketer prepares an augmented product that exceeds
customer expectations. In developed countries, brand positioning and
competition take place.
E.g. Hotel customer expect cable or satellite television with a remote
control and high-speed internet access, Mini bar etc.
Product level
 Potential Product: This level prompts the companies to search for new ways
to satisfy the customers and distinguish their offer.
Successful companies add benefits to their offering that not only satisfy
customers, but also surprise and delight them.
Delighting is a matter of exceeding expectations.
E.g. super high speed internet.
A Potential Hotel Room of Tomorrow
 A sleep environment that helps you to overcome jet lag with bed that adjusts
to your body and monitors your blood pressure as you sleep.
 Voice activated light, heat, A/C, window curtains and music.
 A super shower that is also a steam room, with spray jets from head to toe.
 A pint-size robot that cleans your room, gives you a massage and mixes you a
cocktail.
 A bacteria destroying “bomb” that sanitizes your room at the simple touch of
a button.
 A gentle wake up call- a gradual environment change, curtains slowly open,
the coffee maker starts up and you hear your favorite kind of music.
3. Product Line

 “ A product line is a group of products that are closely related, either

because they function in a similar manner, or are sold to the same
customer groups, or fall within given price ranges”.
 E.g. Unilever have many product lines- Personal care products and
Packaged foods are two product lines.
 4. Product Mix
 It is the total set of brands marketed by the company.
 The width of product mix is the number of product lines that a company
offers.
 A product mix also called product assortment is the set of all products a
particular seller offers for sale.
 A product mix consists of various product lines.
 Product-Mix

Examples
(a) Godrej Agro division has a wide range of products in Animal feeds,
Agricultural inputs, Horticulture, and Tissue culture.
(b) The consumer product portfolio of Nirma Limited consists of
Fabric-care products, Personal care products, Food products, and Scouring (Clean)
products and in each of these categories, company has different brands and
variants.
 A company product mix has a certain width, length, and depth
The width of a product mix refers to how many different product lines the
company carries.
The length of a product mix refers to the total number of items in the mix.
 The depth of the product mix refers to how many variants are offered of
each product in the line.
Product –Mix Width and Product Line Length
for HLL
Product –Mix Width

Home and Personal Care Foods

Personal
Laundry Skin care Oral care Hair Care Tea Ice Cream
wash

Lux Surf
Lifebuoy Fair and Brooke
Excel Bond
Liril Lovely Pepsodent Sunsilk
Hamam Rin Naturals Kwality
Breeze Close-Up
Lipton Walls’
Dove Wheel Pond’s Clinic
Pears
Rexona
Product Line: Width, Length, Depth,
Consistency

Product Mix Width Product Mix Lenght Product Mix Depth

Product lines the Total number of items Variants offered in
companies carries in the mix each product in the
PL1 PL2 PL3 PL1 PL2 PL3 line
PL1 PL2 PL3

Consistency: How closely the various product lines are related

 Width
The width of an organisation's product mix pertains to the number of product
lines that the organisation is offering.
For example, Hindustan Uni Lever offers wide width of its home care,
personal care and beverage products. Width of HUL product mix includes
Personal wash, Laundry, Skin care, Hair care, Oral care, Deodorants, Tea, and
Coffee.
 Length
The length of an organisation's product mix pertains to the total number
of products or items in the product mix.
As in the given diagram of Hindustan Uni Lever product mix, there are
23 products, hence, the length of product mix is 23.
 Depth
The depth of an organisation's product mix pertains to the total number of
variants of each product offered in the line.
Variants includes size, colour, flavors, and other distinguishing
characteristics. Forexample, Close-up, brand of HUL is available in three
flavors and in three sizes. Hence, the depth of Close-up brand is 3*3 = 9.
 Line Extension
 To Meet changing buyer needs
Combat competitive new offerings
Simply to improve product satisfaction
HUL Launched Surf ultra, Surf excel, Surf excel magic,
International Surf excel etc.
Lifebuoy personal , Lifebuoy plus , Lifebuoy Gold , Liquid
Lifebuoy , Lifebuoy Active etc.
HUL has added Fair& Lovely oil control fairness gel to the
product offered under the brand name Fair & Lovely etc.
Product Line Decisions

Product Line Length

Number of Items in the Product Line

Stretching Filling
Lengthen beyond Lengthen within
current range. current range

Can be:
Downward
Upward
Both Directions
 Product Line Decisions
 Downward – HUL from Surf to Wheel , parker with lower priced models ,
Prestige – ‘Prestige popular’ competing Hawkins , P&G ‘s Ariel to Ariel super
soaker and Ariel bars
 Upward – Philips power range from (6000-9000) then to (15000-25000). It
contributed 30% audio sales . Other entrants – Aiwa ,Sony and Akai)
 Both Directions.
Two-Way Stretch

Marriott added the Renaissance Hotels line to serve the upper end of
the market and the TownePlace Suites line to serve the moderate and
lower ends.
Titan products
 Titan India is one of the leading manufacturers of watches and jewellery in
India.
 Some of the prominent brands covered under the Titan brand are Titan Edge,
Fastrack, Nebula, Raga, Flip etc. Jewellery under Tanishq.
To tap the potential of the lower end market, Titan launched low priced
watches under the brand of Sonata.
The brand is positioned as a lower priced watch targeting semi urban and
rural customer.
 Filling
Lengthen within current range

 Firm introduces more items to line to plug certain

gaps in its current range of offers
 The intension is to see that it is seen as ‘full line’
company and customers do not go to competitors for
offers in particular price slots
 Videocon air-conditioners – 10 in split Ac’s , 6 in window
AC’s with rotary compressor and 6 models in window AC’s
with reciprocators compressors.
 P&G added Rejoice to its existing range of shampoo brands
Pantene and Head & Shoulders.
 Pruning
Shorten within current range
 When companies find that their product lines have
got unduly (over) and complicated, with too many
brands , variants and sizes
 It is opposite to line stretching and line proliferation
 Line is prunes ,trimmed to make it better organized
line .
 Company here try to save cost and maximize
efficiencies in production, distribution and promotion
 E.g. P&G had 51 versions of Head and Shoulder shampoo,
they were reduced to 15 variants
 In Japan – Max factor brand in cosmetic items from 1,385
to 828 and sales went up by 6%
 P&G also tried to market separate disposable diapers for
boys and girls but later thy claimed that such anatomical
targeting was not necessary.
THE PRODUCT LIFE CYCLE

 Product life cycle: progression of

products through introduction, growth,
maturity, and decline stages
The Product Life Cycle
Introduction

 Firm works to stimulate demand for the new market entry.

 Customers are suspicious of product benefits and not sure if it will serve their
needs.
 Promotional campaigns features and attempts to generate awareness,
interest, and trial
 Additional promotions to intermediaries attempt to induce them to carry the
product
 Although prices are typically high, financial losses are common due to heavy
promotional and research-and-development costs
Strategy:
 The company builds sales by expanding market for the product.
 Heavy expenditure on advertising and personal selling is essentials.
 Promotion should stimulate trial.
 Advertisement and sales promotion schemes can be used.
 Rapid skimming: Price the products very high and also promote the products at
a higher level.
 This is applied with a view to skim the market as quickly as possible.
 It is useful when consumer knowledge about the product is very low.
 Slow skimming: When product is not new to the market and there is no threat
of competition.
 Producers offer their product at a higher price and the products are supported
by a limited promotional budget.

 Eg: Harley, Merc

 Rapid penetration: When product is unknown to the market and the market
size is relatively large, companies adopt the rapid penetration strategy.
Marketers offer the product at a very low price and the product promotion
budget is large.
Eg: Sim cads, Jio Phones
 Slow penetration: The strategy is adopted when the product is well known to
consumers and when the market is very large in size.
Marketers may offer the product at lower prices and the product is supported by
a limited promotional budget.
Eg: cheap 2 wheeler from well known 2 wheeler company
The Product Life Cycle
Introduction Growth

 Sales volume rises rapidly

 Firm usually begins to realize substantial profits
 Success attracts competitors.
 Firm may need to make improvements to the product
 Additional spending on promotion and distribution
may be necessary.
 Companies resort to various strategies such as
aggressive pricing, product quality optimization,
distribution network optimization,etc., to sustain as
well as to improve the sales.
 The Product Life Cycle
Introduction Growth Maturity

 Industry sales continue to grow, but eventually reach a

plateau due to too many players.
 Invest heavy on R&D to improve quality of products.
 Many competitors have entered the market, sales and
profits begin to decline
 Differences between competing products diminish
 Available supplies exceed industry demand for the first
time
 Must manage competition and look to extend PLC.
 Strategy used - increased advertising and communication
to sustain the profitability of the product.
The Product Life Cycle
Introduction Growth Maturity Decline
Decline

 Increasing competition, advancements in

technology, Innovations or shifts in consumer
preferences cause an absolute decline in industry
sales.
 Industry profits continue to fall -- sometimes
become losses
 Firms cut prices in a bid for the dwindling market
 Manufacturers gradually drop the declining items
from their product lines.
Activity:
 Gujarat Cooperative Milk Marketing Federation (GCMMF) announced its plans
to introduce a new product, a ‘coffee-based gutkha without the harmful
tobacco’.
 Suggest a suitable strategy to GCMMF for introducing its new product in the
market, considering the fact the company’s product is in the introduction
stage of PLC.
Samsung india electronics ltd.
Growth strategies for new markets
Samsung India Electronics Ltd is customizing its product
range to suit the needs of the Indian customers as part
of its strategy to drive its growth in the domestic
market.
To take on competition and retain its position, Samsung
India proposes to introduce new models in each of the
home appliance product categories as well as in
refrigerators, washing machines, AC’s, microwave ovens
and colour televisions.
Contd..
 For its fully automatic washing machines will have memory
back- up facility to meet the power failures.
 For microwave ovens facility of pre-programmed ‘one -
touch Indian menu’ concept, conducting cooking classes
etc thereby making cooking more convenient for the India
housewife.
 The company is also expanding the dealer network, it is
strengthening its penetration levels in the Indian market.
THANK YOU