Marketing and Public Relations
Marketing is the process of determining the
needs and wants of consumers so that products and services can be promoted and
sold. It is responsible for identifying, anticipating and satisfying customer
requirements to make a profit. This is known as a bridge from the producer to
the consumer.
It’s a good idea when marketing to create a
strategy to help keep ahead with the competition, which will help benefit the
company and the customers. Marketing starts with market research, which is a
learning process that marketers need to go through to know as much as they can
about the needs and wants of the consumer. Market research is the procedure of
gathering, recording and analysing the issues relating to the product or
service. The goal is to identify and assess how changing elements of the
marketing mix impacts customer behaviour. The marketing is crucial when
determining a product or brand’s unique selling point, which is often the same
as the four P’s:
Product – The product is the item that satisfies what
the consumer needs and wants. Every product or service is subjected to a life
cycle, which grows depending on how successful it is.
Price – Is the amount a customer pays for the
product. The price is crucial as it can determine the success of the product.
It is important to consider the cost of each individual product or service,
this way it is easier to see how much is needed to break even, including all
the costs from retailers. For example, the actual cost to make a 2-litre bottle
of coke is 2½p, but as it is sold in many shops and supermarkets, all these
corporations need a share of the profit.
Promotion – the methods of communication that a marketer
uses to provide information to outside parties. Promotion includes elements
such as; advertising, public relations, personal selling and sales promotion.
Place – The place refers to where the product is
going to be positioned which is convenient for consumers to access.
There are two methods when conducting market
research; qualitative and quantitative. Qualitative research is a type of
research based on opinions. This method can’t be measured but it can show how
people feel about something, which is a good thing when dealing with products
and services. Quantitative research is dealing with numbers and anything else
measurable, such as statistics, diagrams, charts, tables, etc. It is used to
show how many people feel a particular way, in the case, about the product or
service.
In order for the marketing bridge to work
correctly, they must follow the nine important functions to provide the
consumers the opportunities to accumulate their needs and wants.
Buying – Consumers have the opportunity to buy the
product or service that they want.
Selling – Producers function within a free market to
sell products to the consumers.
Financing – financial institutions such as banks provide
money for the production and marketing of products. Therefore it is vital for
their pitch to be successful.
Storage – Products must be stored and protected until
they are needed. This function is especially important for the perishable
products such as fruit and vegetables, and also items that need to be kept at a
certain temperature.
Transportation – products must be physically relocated to the
locations where the consumers can buy them. These include train, ship,
airplane, truck, etc.
Processing – Processing involves turning the raw product
into something the consumer can use. For example, in the process of making
chocolate, the cocoa beans need to be roasted and grinded, before completing
the other steps in making the actual chocolate. There is no use for the raw
product, which is in this example cocoa beans, but when it’s processed into the
chocolate the consumer has more use for it.
Risk-Taking – Insurance companies provide cover to protect
producers and marketers from loss due to fire, theft or natural disasters.
Marketing
information – Information from
around the world about marketing conditions, weather, price movements, and
political changes. All these can affect the marketing process and is provided
via the TV, Internet of phone.
Grading
and Standardizing – Products
are graded in order to conform to previously determined standards or quality.
For example, when you buy Levi jeans instead of jeans from a high-street store,
you know you are getting good quality jeans.
The marketing process must also add ‘utility’
to the products the consumers want. Utility is the use/satisfaction the
consumer can get from a product. There are four types of utility: form, place,
time and possession; and together they help create customer satisfaction.
Form – form refers to the product being processed
into a form that the consumer wants or needs. For example, wheat is processed
into bread, tress processed into paper, potatoes are processed into chips, etc.
Place – Place utility involves transporting products
to a location that is convenient to your customers. For example you don’t want
to travel to London to buy a product when you live in Cambridge. It’s
inconvenient, and due to our modern transportation we can simply just drive to
our local supermarket.
Possession – This gives the customers ownership on the
product or service, enabling them to receive benefits for their own business.
When products are purchased, you usually receive a receipt. For example, you
can get shares in corporations such as Tesco, or when you purchase a video game
you receive a users license to use it.
Time – This is to ensure the consumer can purchase
the product or service at the time that they need them. A late delivery could
have impact on the consumers purchasing it.
I decided to get a product to show the examples
of the marketing process. My product is going to be Cadbury Dairy Milk
chocolate bar. In June 1905, Cadbury launched its first Dairy Milk bar. This
was with a higher proportion of milk than previous chocolate bars, and it
became the best selling product by 1913. In 1928, Cadbury’s introduced the
“glass and a half” slogan to accompany the Dairy Milk Bar.
Dairy Milk has always tried to keep a strong association with milk, and
advertisements and commercials have always featured a glass of milk pouring out
and forming the bar. However
since 2007, Cadbury launched a new advertising campaign called Gorilla from a
production company called “Glass And A Half Full Productions”. The advert
consists of a gorilla on a drum kit, drumming along to the Phil Collins song
“In the Air Tonight”. The campaign has made appearances on billboards,
newspapers, TV commercials, magazines, cinema and the internet. The reason for
the change? The advertising company created a pitch to Cadbury. Their proposal
was to steo away from the pushing product through the traditional advertising
means, and instead produce entertaining pieces which would appeal to a broader
range of consumers and spread through viral marketing. The change in marketing was a success and
Cadbury sales increased. This is good advertising.
The processing part of
creating a Cadbury Dairy Milk is how it is all starts, this is how it is made.
Cocoa beans come from cocoa pods
that grow on cocoa trees. These tress grow in warm, humid places near the
equator. When the cocoa pods are ripe, they turn a rich golden colour, and are
cut down from the trees and split open. They pulp and beans are removed. To get
a good chocolate flavour, the beans need to be fermented, where are kept in
leaves for about 5 days, and the flavour develops, as well as becoming liquid.
These wet beans are then dried in the sun.
The beans are then packed and transported by
boat to the UK, where they are cleaned and roasted. They are then grounded
until they become a chocolate-colour liquid. This liquid is called mass.
To make Cadbury Dairy Milk the cocoa mass is
mixed with sugar and full cream milk. The mixture is dried in a vacuum to
become and dairy milk ‘crumb’. This crumb is taken to the chocolate factories where
are flavourings are added.
SWOT analysis is a strategic planning method
used to evaluate Strengths, Weaknesses, Opportunities, and Threats involved in
a project or business venture. It is done by getting a group of people to
answer four questions. People usually do a SWOT analysis by considering each of
the four factors in turn:
Strengths – characteristics of the business that give an advantage over
others in the industry.
Weaknesses – are characteristics that place the firm at a disadvantage
relative to others.
Opportunities – external chances to make greater sales or profit in the
environment.
Threats – external elements in the environment that could cause trouble
for the business.
Identification of SWOTs is essential because of
the subsequent steps in the process of planning for the achievement of the
selective objective may be derived from the SWOTs.
I am now going to give a SWOT analysis using my
example; Cadbury Dairy Milk.
Strengths: Cadbury have a very wide portfolio of products. These products range
from chocolate bars (Dairy Milk ranges, Crunchie, Caramel, Wispa, Flake, etc),
chocolate buttons, boxed chocolate (Milk Tray, Heroes, etc), Easter eggs (Creme
Egg, Mini eggs, etc), deserts, trifles and many more. Cadbury also own the
companies Marnards and Halls, and are associated with several types of
confectionary companies including Trebor and Bassett’s. Cadbury’s have such a
wide range of products that they have no problem with their customers getting
bored. The company also releases limited edition products, which are available
to the public for a certain period of time. These limited edition products will
often be released again, sometimes permanently.
On the whole, Cadbury have good prices,
depending on what store it is bought from. On average Cadbury Dairy Milk costs
58p. According to price there is not much difference between brands, it depends
more on the shop. In large supermarkets the prices are a lot cheaper than shops
like WH Smiths and Newsagents.
Cadbury is an international brand. The Cadbury
Dairy Milk is available in 33 countries. In January 2010 Kraft Foods bought
Cadbury for £11.5bn. This takeover has made Cadbury global and now accessible
in the USA. Cadbury’s biggest competition is probably Nestle, which operates in
86 countries around the old, whereas Cadbury operates about 60. Cadbury has
always been a British company, now it has been bought by one of American’s
biggest multinational confectionary companies (Kraft Foods), it can now broaden
the market even more to other countries.
Fairtrade is an organised social movement that
aim to help developing countries to make better trading conditions, and giving
them a better percentage of the profits. Cadbury have achieved their Fairtrade
certification for their Dairy Milk.
Other strengths included advertising (which I
explained earlier), good availability (Cadbury products are available in most
shops), they have a good reputation and have a large target market.
Weaknesses: Cadbury is dependant on the confectionary and beverage market. Their
competitors Nestle have a more diverse product portfolio, so their products can
be used to invest in other areas of business.
Nestle also has more international experience;
even though Cadbury has been traditionally strong in Europe, they could have
possible lack of understanding of the new emerging markets compared to
competitors.
Cadbury have had problems with health and safety.
In 2006, one of the Cadbury factories detected a rare strain of salmonella
bacteria, caused by a leaking pipe and affecting seven of the products. The
contamination cost the company £30million. They have had a few, not so serious,
issues since.
They also don’t have any dietary options. In
today’s society, there are so many people being diagnosed obese or overweight.
With many people being so weight conscious, sales are surely going to decrease
until Cadbury bring out a ‘light’ or ‘weight watchers’ range.
Opportunities: The main opportunity is obviously new market. There are significant
opportunities to expand into the emerging markets of China, Russia, India, etc.
Their populations are growing, consumer wealth is increasing, and so they have
more money to spend on luxuries such as confectionary.
Cadbury needs to respond to consumer tastes and
preferences. Healthier snacks with fewer calories need to be developed, as we
are in weight conscious society. Low-fat, organic and natural confectionary demand
is strong.
Threats: social changes – with the rising figures of obesity and consumers
obsession with calorie counting. Nutrition and healthier lifestyles affecting
demand for core Cadbury products. Cadbury will then need to release healthier
options.
Competitive pressures from the other branded
suppliers – national and global. For example Nestle or Mars are currently much
more global than Cadbury. However Cadbury has just been bought by a multinational
company in America (Kraft Foods) and will soon be real challengers for
competitors such as Mars and Nestle.
The recession. This down turn in the economy
may affect sales. As consumers have to budget their spending, luxuries like
chocolate will be one of the first things that will not be purchased.
There is also an increasingly demanding cost
environment, particularly for energy, fuel for transport. Packaging and sugar.
These increased prices will result in the increase the retail price per
chocolate bar. If this happens, the consumer is more likely to purchase
products from a cheaper competitor.
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