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SMALL BUSINESS MANAGEMENT
Chapter 8Marketing Management
Skeets and Skiles
How do we make a Buck?
Margin * Volume (Selling price – cost) * Volume
How could these companies increase their making a buck?
Breadman Java Nook Cottage Cheesecake Earth Buddy Bright Lights
The Role of Marketing Management in the Small Business
Defining the target customer, characteristics and wants and needs
Understanding the environmentals that affect operations
Developing the product and/or service Developing the channels of distribution Setting price levels of the product
and/service Promoting the product and/or service to
those influential in its purchase
Target Customer
Consumer Market Organization market Export market
How do find out info about the target customer> Market research
The Consumer Market
Demographics Age, income, education, occupation, location
Lifestyle characteristics Activities, interests opinions
Purchase characteristics What when where how much of product
Purchase motivations Why ?
The Organization Market
Companies and government agencies that purchase from small businesses
Influences on industrial demand the economy, government legislation and regulations, potential competition agencies that exert influence on
purchasers The Bidding-Tendering Process
Ace clear defence
The Export Market
Government Assistance for Exporting
Unique Characteristics of the Foreign Market
Mechanisms of Exporting Documentation, credit offered,
distribution, Security
Influences External to the Market
The Economy Competition Legal Restrictions Social and Cultural Environment Technology
Influences External to the Market (Fig 8-6)
Management of External Influences The Influences
Economy, competition, legal, socio/cultural, technology
The Possible Characteristics System to Monitor Possible Internal Adjustments
Developing the Product or Service
Develop Product and/or Service Policies
Decide how the product will be manufactured
Understand the product life cycle
Wild West
Wild West - Vulcan
Describe the Influences External to the Market for this company and how it might affect the adoption of this product
Developing the Product or Service (cont)
Determine Factors that Accelerate Adoption relative advantage complexity divisibility communicability of results
Poop Smell NY
How the Consumer Classifies the Product and/or Service
convenience products Staple vs impulse
shopping products appliances, stereos, cameras
specialty products Mercedes
Unsought Funeral plots
Field of Seeds
Spitz
How would you classify this consumer product? Why?
Describe their distribution system? Is it effective? Why or why not?
Where would you describe this product in the PLC? How could they ( or have they) alter this position in the PLC?
Field of Seeds
Margin * Volume As managers at Spitz how do increase
making a buck? What might be the best strategy for
Spitz to move into the Quebec market?
How the Organizations Classifies the Product and/or Service
Production Goods Raw Materials: Component parts: becomes part of the physical
product Process materials: not readily identifiable part
of the production of other products Support Goods
Major Equipment: Accessory Equipment: Type writers and tools Consumable Supplies: IE Paper, pencils or oils Business to Business services: Financial, legal
marketing research etc.
Developing the Distribution System (Fig 8-9)
Channel Options Manufacturer to Consumer (Short-Direct) Manufacturer to Wholesaler to retailer to
consumer (Long-Indirect) Channel length Channel Intensity
Breadman Java Nook Cottage Cheesecake Earth Buddy Bright Lights Spitz
Setting the Price for the Good and/or Service
Cost-Based Pricing Demand-Based Pricing
elasticity Competition-Based Pricing
Movement & Shift of demand curve
Promotion
Types of Promotion Advertising
types, advantages, disadvantages, suitability, costs
Sales Promotion Public Relations Personal Selling
Spin Master
Spin master
What inexpensive forms of promotion have been used by Spin Master?
What are the advantages and disadvantages of an Air Hog section in this industry?
What are the risks associated with operating a business in this industry?
marketing strategy to achieve a competitive advantage
find a niche and fill it $3,000,000
don’t just sell; entertain ( Cabellas)
strive to be unique $400,000
connect with the customer on an emotional level
focus on the customer devotion to quality attention to convenience concentration on innovation dedication to service emphasis on speed
Steps in a Promotional Campaign
1. Set Promotional Objectives (NUMBERS)
2. Determine the Promotional Target
3. Understand the Target’s Needs and Perceptions of the Product/Service
4. Develop the Relevant Theme
5. Determine the Method or Media to Use NY Smell
Steps in a Promotional Campaign (cont)
6. Develop a Specific Promotional Message
7. Set the Promotional Budget
8. Implement the Program
9. Evaluate the Effectiveness of the Promotion
Appendices
A. Agencies Providing Export Assistance
B. Advertising as Practised by Small Business
C. Directories of Trade Shows and Exhibitions
D. Checklist for a Marketing Plan