MARKETING

Difference between Market and Marketing

A market is any space within which trade takes place between buyers and sellers for a well
defined product. This space can be a produce market, a shop, internationally between countries
or over the internet.
Marketing is all those activities that facilitate trade. These include activities that identify
consumers’ needs such as market research and those activities that satisfy consumers needs e.g.,
packaging and distribution. Marketing activities therefore support the marketing of goods and
services.
Institute of Marketing definition of Marketing: the management process responsible for
identifying, anticipating and satisfying consumer’s requirements profitably.

Marketing Activities
Market research – the process of gathering information about potential customers.
Packaging – creating a suitable package for product usage and for advertising
Branding - differentiating the product of a company from other brands and establishing loyal
customers.
Pricing - identifying the right price that will encourage sales
Advertising – methods used such as the media to inform and encourage the purchase of goods
and services
Sales promotion – short-term methods used to encourage consumers to buy during a specified
period
Distribution - methods used to make the product available to consumers. For example wholesale,
retail or internet.

The Marketing Mix

The marketing mix, also referred to as the 4 Ps of marketing, categorizes all the various
strategies used in the marketing of goods and services. These categories are product, promotion,
pricing and place. The purpose of the marketing mix is to create perceived value for the customer
or target market.
(1) Product this includes product designing, packaging, labelling and branding.

(2) Promotion advertising, public relations and sales promotions.

(3) Pricing includes various pricing strategies and methods.

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(4) Place distribution of products.

Factors that Influence Consumer Behaviour

The following factors will cause consumers to either increase or decrease their demand for a
product.
-The price of a commodity
Consumers can afford to buy more of a good when its price falls and less when its price rises.
-The prices of other goods and services (substitutes and complements)
Substitute products are those that can be used alternatively as they satisfy the same need for a
consumer. For example, a weekly shopper may decide to purchase fish instead of chicken
because the price of fish has fallen significantly less than the price of chicken. Therefore either
fish or chicken will be adequate for dinner. If by the next week the price of fish rises and
becomes more expensive than chicken then the consumer will opt for chicken.
Complements are goods that are used together e.g. bread and butter. If the price of butter rises
then its demand will fall and so will the demand for bread. Conversely if the price of butter falls,
its demand will rise and so too will the demand for bread.
Income of consumers
As income level rises consumers will demand more goods and services
-Taste and Preferences
A change in consumers' taste for goods and services will impact their demand. For example,
changes in fashion will result in a drastic decline in demand for an outgoing fashion and a rise in
demand for what is trendy.
-Quality
A Consumer’s main motivation for the purchase of a product may be the quality of the product
rather than the price. Eg perceived higher quality of Apple products
-Expectations of a future Rise in Price
If consumers expect the price of a commodity to rise in the near future, they will try to purchase
more now, before the price increases.
-Brand Loyalty
Brand loyalty will ensure a continuous demand for a product regardless of changes in its price or
the prices of other goods and services.
-Spending Patterns
Consumer spending surveys compile information on consumer spending patterns based on
income levels. This informs businesses of what goods and services are in demand.

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-Changes in the size of the population
A population decline will cause demand to fall in a particular region. One reason for a population
decline in a region is migration.

Packaging and Presentation of Goods

Packaging refers to designing and producing the container that holds the product. A good
package must identify, protect and advertise the product. It must also make the product
convenient to use. Therefore products such as toothpaste are best packaged in a tube as it has to
be squeezed out. Milk must be poured from its container. Egg containers are so shaped to hold
them securely.
A package must also sell the product. It must first attract customers to buy. It must provide
information about the product i.e. ingredients, amount of contents, price, the name and address of
the manufacturer and instructions for usage. The brand name is also displayed on the package.
Branding
A brand is any identifiable feature of a product which makes it different from its competitor. A
brand may be a name, term, symbol, design or combination of these. Examples of brand names
include: Avon and Colgate. A brand symbol e.g.

represents the Nike brand. A branded product will increase the value of the product in the eye of
the consumer and enable consumers to recognise a product instantly.

Labelling – Labels are important features of a product that provides customers with vital
information on grade, product description, ingredients, uses, caution, expiry date, date of
manufacture and storage.
Methods of Promoting Sales
Promotion includes all forms of advertising, public relations and sales promotion.
Advertising is the paid presentation of goods or services through the media for the purpose of
encouraging consumer patronage. The media refers to television, radio, magazines, newspapers,
billboards, websites etc.
The Purpose of Advertising
-to attract attention and create awareness
-to inform and educate customers

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-to increase sales
-to introduce new products onto the market
-build loyalty with customers
-to differentiate from competitors

Types of Advertising

Informative Advertising

Informative advertising is often used when launching a new product, or for an updated or
relaunched product. The objective is to develop initial demand for a good, service, organization,
or cause. It is used when a new product is put on the market or when an old product has been
re-launched or updated.

Informative advertising will tell the consumer and marketplace about the product, explain how it
works, provide pricing and product information, and should build awareness for the product as
well as the company. The image of the product and the company should be compatible and
complementary. There should be enough information to motivate the consumer to take some sort
of action.

Persuasive Advertising

Marketers use persuasive advertising to increase the demand for an existing good, service, or
organization. The idea is to persuade a target audience to change brands, buy their product, and
develop customer loyalty. After the purchase, the quality of the product will dictate whether or
not the customer will remain loyal or return to the previous brand.

Persuasive advertising is highly competitive when there are similar products in the marketplace,
and products are competing for their share of the market. In this situation, the winning product
will differentiate itself from the competition and possess benefits that are superior to, or compete
strongly with, the competition.

Reminder Advertising

Reminder advertising reinforces previous promotional information. The name of the product,
testimonials of past customers, public response, and sales techniques are repeated in the hopes of

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reminding past customers and garnering new ones. It is used to keep the public interested in, and
aware of, a well-established product that is most likely at the end of the product life cycle.

Competitive Advertising

Promotes one product over a competitor

Defensive Advertising

Reacts to competitive advertising to maintain market share.

Forms of Advertising
Direct Forms Indirect Forms
Circulars Press: Newspapers, Magazines, Journals
Catalogues Television, Radio, Website, Social Media
Free Samples Cinema Screens
Souvenirs Posters, signs and wallscapes
Word of Mouth Point of Sale: Speciality shop display
Cell Phones Exhibitions, fairs, carnivals
Chat room Mobile Caravans

Sales Promotion
Sales promotion is a marketing strategy that is used to induce customers to buy immediately.
Examples of sales promotion methods are:
a. A sale on items.
b. Bargain packs, e.g. ‘two for price of one’.
c. Coupons. These are printed in the daily newspaper or magazines. The holders of coupons are
allowed a discount on the items bought.
d. Games, e.g. guessing riddles
e. Contest. Purchasers may receive a prize if they are the winners of a contest.

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f. Trading Stamps. These are given to purchases with each item bought. Booklets filled with
these stamps may be returned by customers for goods, services or money in exchange. This
predates the loyalty card.
g. Loss–Leader. A loss-leader is a product that is in high demand and is therefore used to attract
consumers to a business location by cutting its price very low. The business uses a loss leader to
attract a large number of persons to its location so that other items will be sold. The profits lost
on this product will be made up on the high sales turnover of the other products that will be
bought along with the loss-leader.
Public Relations
Public relations activities are aimed at creating a favourable impression of a business in the eyes
of the public. Public includes its customers, its suppliers, the government and the surrounding
community. Public Relations activities include sponsorship of local sporting events, press
conferences, and donations to charity.
Techniques of Selling
These are methods used to sell products more effectively by focusing on each customer’s
personal needs. Selling techniques include:
1. Personal Selling
2. After-sale services such as warranty and installation
3. Merchandising
4. Good Customer Relations
Personal Selling
This is the use of sales persons to present and sell goods and services of a firm. Sales persons
promote a firm’s goods directly to a specific consumer. They locate new customers, provide
display services, demonstrate the use of products, deliver goods, collect payments and provide
the firm with feedback
After Sales Services
Customers are entitled to these services once they have made a purchase. They include delivery,
installation and warranty. These services are free and therefore usually encourage consumers to
buy.
Merchandising
Merchandising refers to self-service methods of sale. This is used in supermarkets and
department stores. It allows for a better display of goods and creates a more comfortable
shopping environment.
Good Customer Relations

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Building good relationships with customers ensures customer satisfaction, repeat customers and
recommendation to new customers. The sales staff must be trained in the principles of good
customer relations. This entails listening to customers being helpful and polite.
Methods of Retailing
There are several methods by which retailers can offer items for sale.
Community Shops and Convenient Stores
These locations tend to serve a particular community. Opening hours include all weekend days,
holidays and very late in the evenings. Costs for some commodities that are not government
controlled tend to be higher than other types of retail outlets. Community shops in particular cut
and shape products to suit customers and offer credit.
Department Stores
These stores carry several lines of goods under one roof. A department store may feature a
clothing department, household items, stationery, hardware etc. It provides convenience to
customers who can pick up several items in one place, and allows the businessman the cost
effectiveness of operating several business entities in one location.

Mail Order
Companies that retail through mail order benefit from reduced operational cost of location and
staff. Since display areas are not required only an office and storage facility are necessary for the
operation of this business. Orders are made from catalogues and goods are delivered by courier
or mailed to customers. This saves time and effort of consumers to visit shopping locations.
E-commerce
Orders are made by customers over the internet from the websites of businesses. Payments are
also made over the internet. Packages are delivered by mail or courier.
Tele- marketing
Tele –marketers introduce the company’s goods and try to obtain orders via the telephone.
Vending Machines
These self-service machines are placed at various locations by their owners. Customers are
required to place the required funds inside these machines and are then instructed on how to
make their choice. The machine then dispenses the product. This type of business is very cost
effective as owners may only pay a fee for locating the vending machine.

Terms of Sale

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A business establishment may offer its customers various terms to settle accounts i.e the way that
payments are made for purchases.
Cash- This is preferable by most businesses and therefore customers are encouraged to make
cash payments. They are usually offered a lower payment amount for goods bought for cash.
Credit - Customers are allowed to pay at intervals over a short- term, usually one to three
months to settle outstanding balances.
Hire Purchase - Hire-purchase is a long term payment plan e.g. 24 – 36 months. Interest is
charged to the customer increasing the amount owed.
Cash Discount
A cash discount is a reduction in the price of a good that is paid for immediately or over a short
period of time by a customer. For example, if a an appliance store offers 5% discount on items
bought for cash then 5% of the sale price would be deducted from the actual bill

Trade Discount
A trade discount is the reduction in the price of a good given by a manufacturer or a wholesaler
to a retailer to allow the retailer to make a profit or to encourage bulk buying. Thus if an
appliance manufacturer offers a 10% trade discount to retailers then 10% of the catalogue price
or the quoted price would be deducted from the retailers’ actual bill.

Consumer Organizations
Consumerism is defined as the education and the protection of consumers to prevent their
exploitation.
Consumer exploitation includes:
● overcharging
● offering poor quality goods and services
● short measurements and weights
Consumerism is practised by various groups in the economy: the government, private
institutions, and private firms.
Consumerism practiced by the government
This is done through various government agencies. These include:
1. The Consumer Affairs Commission – This institution was set up to disseminate information
about consumer rights and responsibilities as well as provide consumers with an avenue for
redress if they are exploited.

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Consumer Rights
-The right to safety
-The right to be informed
-The right to choose
-The right to be heard
-The right to redress
-The right to consumer education
-The right to a healthy environment
Consumer Responsibility
-The responsibility to beware
-The responsibility to be aware
-The responsibility to think independently
-The responsibility to speak out
-The responsibility to complain
-The responsibility to be an ethical consumer
-The responsibility to respect the environment and avoid waste, littering and contributing to
pollution.
2. The Fair Trading Commission – This agency was set up to administer the fair trading act. It
is concerned with matters such as; Tied selling (marrying of goods), misleading advertising
(untruths about goods and services presented for sale), untrue sale (an announced sale for which
the price of items remain the same).and the use of market dominance to squeeze firms out of the
industry (For example, large firms may drop the price of their goods so low that small firms are
unable to compete with them.)
3. The Bureau of standards -The bureau carries out regular checks on business enterprises to
ensure that goods and services offered for sale meet the standards stipulated by this institution.
Functions are as follows:
● Protect the consumer or user against danger
● Protect public health or industrial health, welfare and safety
● Protect the environment
● To ensure acceptable quality of goods
● Research in relation to international quality standards

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● Examination and testing of goods
● Establishment of quality standards
● Collection and publication of data on specification and standards
● Advising on quality control systems
● Certification of goods that meet quality standards

4. The Ombudsman
The Ombudsman is a government official who protects the rights of citizens who may suffer any
kind of injustice from dealing with a government agency or a government official. For example,
the Ombudsman will investigate the death of a loved one due to the negligence of a public
hospital. He/she has the power to:
● to summon witnesses to appear and give evidence under oath
● to enter and inspect any government department or authority
● to examine any necessary documents
Consumerism practiced by private Institution
-Local consumer groups
-Radio talk show hosts listens to consumers’ complaints
Consumerisms practiced by private firms
-Offering warranty/guarantees on items sold
-Labels carry information on ingredients, nutritional content and health risks that may be
associated with the product.
Role of customer service
❖ Ensuring conformity to customer requirements;
● adherence to copyrights,
● effective communication,
● coordinating flow of goods,
● services and information
Forms of customer service

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Forms of customer service:
(a) warranty
(b) after sales service
(c) feedback
(d) online chat
(e) toll free numbers/call centres
(f) suggestion box
(g) surveys

Copyright, Patent & Trademark

Intellectual Property- is any creation of the mind. Songs, books, ideas, machine designs and
other inventions are the intellectual property of the person who has designed or created it.
Copyrights, patents and trademarks are used to protect the intellectual property of owners.
Copyright is a form of intellectual property right that legally protects the creators and innovators
of original works. Copyright protects creators’ expressions such as music, painting, movie,
photograph, writings etc. Individuals who wish to use works that are copyrighted must request
permission from its creator. Copyright law allows creators of original work to be paid for them.
Other forms of intellectual property rights are patents and trademarks.
A Patent is the right granted to the inventor of a process, machine, technique, formula or other
composition of matter. It protects innovation. It also excludes others from making and selling
that invention for a number of years. For eg. a franchisee receives a special licence to reproduce
the product and must pay the fee to the franchisor
Trademark legally protected brand names. It gives the seller exclusive rights to use a particular
brand name.

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