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Each element of the marketing mix has objective and the marketing mix objectives support
the marketing objectives.

1) Product objective
a. Product quality
b. Problem solution
c. Customer perception
d. Product return
2) Measuring customer satisfaction
a. Measure of annual retention rate
b. Frequency of purchase
c. % of customer total purchase captured by firm
3) Product Strategies

4) Product concept

Brand elements: name logo, design

Product development and product improvements: decide on characteristics of
Service provision

5) There are 8 dimensions of quality for goods:

Performance; Features; Reliability; Conformance; Durability; Serviceability;
Style; Perceived Quality
6) Packing decisions
- Functions of a products package
o Protecting the product
o Promoting the product
o Providing information about product and its use
- Increasingly firms are recognising the need to use environmentally
sensitive packages
- Facings
7) Services
- The place of service delivery

Relationship with customers (loyalty card, voucher,)

High contact vs low contact

- A quality image is often related to a high price
- Many customers use price as an indicator of quality
- Pricing decisions need to be coordinate with product decisions
- Pricing decisions need to be coordinated with distribution decisions
o Gain market position
o Achieve financial performance
o Product positioning
o Stimulate (kch thch) demand
o Influence competition (chi phi i th)
o Recoup R&D (thu hi vn u t)
Break-even point = fixed cost / (selling price variable cost)
Companies wishing to make a profit must exceed the break-even unit volume;
however, for new product, the break-even point is initial goal.

1. Penetration pricing (objective: increasing market share or

sales volume, rather than to make profit in the short term)

Penetration pricing is often used in the introductory or early growth stage of PLC.
The strategy aims to encourage customers to switch to the new product because of
the lower price. (Mc tiu chnh ca chin lt thm nhp gi l thu ht khch hng cho sn
phm nh vo gi r)
Target customers are sensitive to price (ntd da vo gi c)
Firm has low-cost position and is pursuing (theo ui) a low-cost business strategy
Firm can gain economies of scale quickly with increasing volume
Low price may discourage competitive entry

2. Price skimming (Objective: maximize short-run cost)

Price skimming is often used in the introductory or growth stage of PLC.
The target is quality-sensitive customers (ngi tiu dung da vo cht lng)
Skimming involves setting a high price before other competitors come into the
market. (Chin lt lt gi c ra 1 gi cao cho sn phm trc khi i th co th trng)
This is often used for the launch of a new product which faces little or no
competition (small market). (Chin lt ny thng s dng cho sp mi vi t hoc khng c
i th cnh tranh)
Example: innovation electronic products, such as the Apple iPad and Sony
PlayStation 3.
However, Price skimming strategy cannot apply for long because competitors soon
launch rival products which put pressure on the price. (khng th p dng lu di v i th
c th sm tung ra sm phm gy sc p v gi c)
3. Maintain quality or service differentiation
Product market is in the growth or maturity stage of PLC
Firms offering is perceived to have a quality or service advantage over the
competitors offering
Firm does extensive promotion to maintain products quality image
Firm has high costs
Target customers are relatively price insensitive
4. Reduced focus priding strategy (Objective: increasing profit)

Product market is in late maturity or decline stage of PLC

Product may still be cash cow
Low margins
Generates short-run cash flow
5. Harvest pricing strategy (Objective: maintain margins and
maximise current profit)
Product market is in late maturity or decline stage of PLC
Firm is pursuing a defensive strategy
Low margins
Generates short-run cash flow
4) PRICE SETTING example
Plus 20% mark-up. / Wholesalers margin (20%) / Sell to retailer at $x.
/ Retailers margin (30%)..
a. Production line pricing (nh gi theo dng sp)
b. Odd/Even Pricing (gi l; ex: 3.99; 99.99)
c. Price Bundling (gi teho gi)

Place (distribution decisions)

Distribution channels
Channels form the physical connection between the company and the final users of the
product. (Knh to ra lien kt gia cng ty v ngi tiu dung sn phm)
Having a good distribution strategy is very important. It can even produce a sustainable
competitive advantage

Distribution Objectives
Increase the availability of the good or service to potential customers.
Satisfy customer requirements by providing high levels of service.

Order cycle time

Dependability & reliability
Post-sale services

Ensure promotional effort (1)

Obtain timely and detailed market information.
Increase cost- effectiveness.
Maintain flexibility.
1. Promotion effort:
Effective POP (point-of-purchase promotion): measured by: % of stores using
special P-O-P displays (posters, banners, display stands or light box)
Effective personal selling effort: The most significant strength of personal selling is
its flexibility. They can repair products, return products, and collect product and marketing
information. Company should train numbers of professional sales person which have strong
knowledge, experiences and good in communication.

Distribution Channel design

Marketing flow channel


Distribution Channels
Channel design
o Number of channels
o Length of channels

o Level of control & adaptability

o Level of distribution intensity
o Shelf position
Direct or indirect; then give example

Promotion & IMC

Identifying target market (1)

After you have target market, it is useful to write a positioning statement. Example:
USP (unit selling proposition) why anyone should choose it?

Promotion Objectives (2)

Example: (should be S.M.A.R.T)

Within half a year, 80% of target customer should be aware of availability of product X
Within 6 months 70% users will have sampled Product X.
By the end of this marketing plan, at least 15% of the target audience should have
purchased Product X

Set the promotion budget (3)

Base on objective and what the company can afford?

Design the promotion mix

Social media
Advertising (TV, radio, magazine)

Sale promotion (brand loyalty, product trial)

Personal selling
Point of purchased