LECTURE 3-B

MARKETING
 MARKETING
Many successful new businesses enjoy
longevity because their owners conduct regular
market research to understand their target
market, identify consumer problems and
pinpoint realistic competitors.

Marketing refers to any actions a company

takes to attract an audience to the company's
product or services through high-quality
messaging.
• It’s the simplest way for entrepreneurs to
keep up with market trends and maintain a
competitive edge by sizing up your business
opportunity.
• Market research can be carried out at various
stages of a business life cycle, from pre-
launch and beyond. Greater understanding of
your marketplace from the very start will
enable you to create a sound business
strategy to establish and grow your brand into
one that’s better than the competition.
 Marketing Components
1Product Description
Draw or describe your product/service
emphasizing the characteristics that make it
better than what is now sold in your area;
Check whether you can make the existing
products/service … easier to use, pleasant,
safer, healthful, comfortable, cleaner,
cheaper, attractive and smarter, as well as
disposable.
• Substituting existing materials with ones that
are cheaper and more locally available ,

Combining or adding more functions, uses and

features in the existing products.
• Maximizing or increasing the size, range,
colours, or materials in existing products.
• Multiplying purpose or changing the purpose
of existing products
• Product/service name, branding, label
 Marketing Concepts
• The Production Concept
• The Product Concept
• The Selling Concept,
• The Marketing Concept
• Societal Marketing concept
• Holistic marketing concept
The Production Concept
• The production concept holds
that consumers will favour those
products that are widely available
and low in cost. Managers of
production-oriented organizations
concentrate on achieving high
production efficiency and wide
distribution coverage.
 The Product Concept
• The product concept holds that
consumers will favour those
products that offer the most quality
or performance.
• Entrepreneurs in those product-
oriented organizations focus their
energy on making good products
and improving them over time.
 The Selling Concept
• The selling concept holds that
consumers, if left alone, will
ordinarily not buy enough of the
organization’s products. The
organization must therefore
undertake an aggressive selling
and promotion effort.
The Marketing Concept
• The Marketing concept holds
that the key to achieving
organizational goals consists in
determining the needs and wants
of target markets and delivering
the desired satisfactions more
effectively and efficiency than
competitors.
 Marketing Terminologies
(Commonly Used)

• Human Needs
• Wants
• Demand, and
• Product
 A Human Need
• Is a state of felt deprivation of some
basic satisfaction such as food,
clothing, shelter, safety, esteem,
belonging, and a few other things
for survival. Note that these
needs are not created by their
society and marketers, they
are biological requirements.
 Wants
• Are desire for specific satisfiers of
these deeper needs. Tanzanian
needs (ugali) food and wants a Rice
Chicken, needs clothing and wants a
Pierre Cardin suit, needs Vitz car and
want Audi Q7. In other societies,
these needs are satisfied
differently. People’s needs are
few but their wants are many.
 Demand
• Are wants of specific products and
services that are backed up by an
ability and willingness to buy them
(purchasing power). Many people
want a Mecedenz Benz or Land cruiser
station wagon (V8) but only a few are able
and willing to buy one. Is not only how
many want your products and services,
more important, how many would be
willing and able to buy it.
 Product
• Anything that can be offered to someone to
satisfy a need or want. The word “product”
brings to mind a physical object such as
an automobile, a television set, a soft
drink, etc. We normally use expression
products and services to distinguish
between physical objects and intangible
ones. We don't buy a car to look at but it
supplies transportation services and
likewise for microwave for cooking.
Physical products are really vehicles that
deliver services to us.
Product Positioning Atlas
Low Price High Quality

High Price
A

C
D

Low Quality
 Quality/Price Strategies
Product Price
High Low
1. High Quality / 2. High Quality /
Product Quality

High High Price Low Price

3. Low Quality / 4. Low Quality /

High Price Low Price
Low
 Quality/Price Strategies
Product Price
High Low
1. High Quality 2. High Quality /
/ High Price Low Price
Product Quality

High (Premium (Super-value

Strategy) Strategy)

Low 3. Low Quality / 4. Low Quality /

High Price Low Price
(Rip-off (Economy
Strategy) Strategy)
 Nine Price/Quality Strategies
Product Price
High Medium Low
1. Premium 2. High-Value 3. Superb-value
Product Quality

High
Strategy Strategy Strategy

Medium 4. Overcharging 5. Medium-value 6. Good-value

strategy Strategy Strategy

7. Rip-off 8. False-economy 9. Economy

Low Strategy
Strategy Strategy
 Marketing Mix
• Is the set of marketing tools or
elements that the firm uses to
pursue its marketing objectives in
the target market.
The 4 Ps of the Marketing Mix
• Product
• Place
• Promotion
• Price
The 4 Ps of the Marketing Mix - Product
• Variety
• Design
• Quality
• Features (size, appearance,..)
• Brand name (e.g. Labels, crowns,…)
• Packaging
• Warranties
• Returns
The 4 Ps of the Marketing Mix - Place
• Location
• Assortments
• Channels of distributions (direct, retail,
wholesalers)
• Coverage
• Transportation
• Inventory (storages, warehouses)
The 4 Ps of the Marketing Mix - Promotion
• Sales promotion
• Advertising
• Public relations (publicity)
• Direct marketing
• Sales-force
The 4 Ps of the Marketing Mix - Price
• Price List
• Discounts
• Allowances
• Payment periods
• Credit terms
 Pricing Strategies
• Cost-plus method
• Competitors prices, and
• What the Market Will Bear
Method
 Cost-plus Method
• Is achieved by adding a reasonable
profit margin (say 30%) to the final total
product cost (i.e. marketing cost, plus
production cost, plus administration
cost, plus finance cost). The final
product cost per unit is determined by
dividing the total product cost by the
number of units produced. To this figure
you may add a profit margin
 Competitors prices
• This method compares your product
with others in the market and then,
based on your product’s quality and
other features, you may fix your
price lower, higher or the same as
your competitors
What the Market Will Bear Method
• This method is based on supply
and demand of the product;
• If is seller’s market set the price
of the product ‘higher’ and
• If is buyer’s market set the price
of the product ‘lower’
MARKETING COMPONENTS
1. Comparison of the service with Competitors
• Explain about quality of services offered by other
competitors and how will you beat the competitors.
Features, price comparisons etc.
2. Business Location
• Strategically where do you located your company and why?
• Proximity to raw materials? Availability Competitors,
proximity to markets etc
3. Market Area/Customers Location
• Where are the potential buyers that you can easily reach-
out located (mention the names of towns, villages,
communities, etc.)
• Why do you think they are the best places for your
product?
 Marketing Components
4 Main Customers
• You have two types of buyers—individuals
and institutional (groups of people). Briefly
describe the behaviour of your potential
buyers; specify their needs, wants, location,
preferences, income level, etc.
• Consult your market survey results. In fact,
you can also annex the summary of your
market survey results
 Marketing Components
5. Total Demand
In estimating the number of buyers, you need to know:
• Locations: The towns, villages, communities, etc. that you
identified earlier You can get the figures from the local DC or
SIDO offices. Please note where you got the figures.
• Target (in % Population): This is your very conservative estimate
of the percent of the population that can really buy your products
and services. To estimate this figure, check with the results of your
market survey.
• Potential Buyers: Multiply the Estimated Population with the
Target (in %) to get the estimated number of potential buyers for
each market location.
• Output: Table of Total Demand Estimate
 Marketing Components
• Table of Total Demand Estimate
Locations Estimated Target (in % Potential
Population Population) Buyers
A
B
C
The number of potential buyers consisting of both individual
and institutional for the product is estimated in the table below
Note 1: What is the usage rate of your product or service or
how often will the average buyer per year__ ? Will the usage
rate increase with time? Yes or No. Note 2: How much are they
willing to spend for your product per unit?_____
 Marketing Components
6. Demand Forecast
• Potential Buyers: By multiplying the usage Rate with the Potential Buyers, you get the future
demand estimates.

Usage
Produ Year Year Year Year Year
rate/Increase
ct 1 2 3 4 5
demand rate
A 10%
B 20%

Note: remember that the forecasted demand customers are all not yours
in sense if you are new in business unless you use your own data
7. Market Share
• What ______% of the total demand is your share? Try to justify your
answer you can carry out supply-demand gap survey and indicate what
percent you can concur the market.
 Marketing Plan Preparation
Most marketing plans consists of Economic and
Marketing Analysis with following sections :
• Executive summary
• Current marketing situation
• Opportunities and issues analysis
• Objectives
• Marketing analysis
• Actions/programmes
• Projected profit and loss statement; and
• Controls
 Economic Analysis
Issues for considerations:
• What is the product?
• How does it compare in quality and price with its
competitors?
• Where will the business be located?
• What geographical areas will be covered by the
project?
• Within the market area, to whom will the
business sell its products? – characteristics and profiles
• Estimate how much of the product is currently
being sold?
 Marketing Analysis
Issues for considerations include:
• Product Strategies such details as brand,
label, packaging and cost per product, etc.
• Channels of distribution (direct, retail,
wholesaler)
• Promotion strategies (advertising, publicity,
warehouses, sales promotion); and
• Pricing strategies to consider cost-plus
method and competitors prices and what the
consumers are willing to pay for.
DECISION GUIDE ON MARKET SHARE
Number of Their Product Market
competitors Size Features share
Many Large Similar 0 - 2.5%
Few Large Similar 0 -2.5%
One Large Similar 0 – 5%
Many Large Not Similar 0 – 5%
Few Large Not Similar 5 -10%
One Small Similar 5 -10%
Many Small Similar 10 - 15%
Few Small Not Similar 10 - 15%
One Large Not Similar 10 – 15%
Many Small Not Similar 20 – 30%
Few Small Similar 30 – 50%
One Small Not Similar 40 – 80%
No Competition 100%
 Group Assignment 3
1. Discuss the concept and roles of digital
marketing to the new business.
2. Elaborate societal and holistic marketing
concepts from entrepreneurship perspective
3. Describe the types of market structure which
are commonly used.
4. Develop a chapter of marketing for your
business
For each concept read and cite at least FIVE scientific paper
published in reputable journal. Submit word and power point
slides. Deadline: 13th December, 2023 at 00:00a.m