WHAT IS PRODUCT MARKETING?You might ask the question, "How to do marketing?" But first ask, "What is marketing?"
An organization must properly define the function of strategic product marketing before it can be effective. For example, one common mistake is thinking that marketing is advertising, another is that marketing is gathering information or finding new prospects. While these objectives are certainly key parts of marketing, the successful strategic marketer will seek additional objectives.
The definition of strategic marketing is usually divided into four functional areas.You may notice that my definition of marketing includes having something for people to buy, finding people who will buy, encouraging people to buy, and providing value. Together, these objectives form a picture of strategic marketing.
To more easily remember these objectives, marketing is often described as The Four P's:
Product: -n. That concept which may be sold.
The word product qualifies a marketing concept. A product is more than a person, place or thing. Nothing is more important to a marketing strategy than the "product concept".
In fact, finding the right product concept is one of the four critical objectives of marketing. The following example illustrates why the successful strategic marketer will carefully and completely consider his product options.
Swiss watch companies made 'Swiss watch actions' and enjoyed a dominate position in the world market. By the 1970's they had introduced many inventive variations of the 'Swiss watch action'. However, they completely ignored the streams of independent invention that, together, created the quartz watch action.
During the early 1900's, aerospace scientists invented new materials like liquid crystals, and laid the basis for miniaturized electronic circuitry, calculators -- and watches.
The number of employees making Swiss watch actions fell from 90,000 in 1970 to 30,000 in 1980 (the number of companies decreased from 1,600 to only 600).
The effect is significant: Still, today, only 35,000 employees manufacture Swiss watch actions.
Aggressive marketers believe that continuous product development is the most important of all strategic marketing activities.
Place: -n. A gathering where people buy and sell
Place can mean geographic and demographic, or in others words, where and who. It can also be the way you take your product to the market (distribution).
Small companies often find a specialized place to sell (often referred to as a 'niche') as an effective way to overcome huge competitors, who easily overlook 5% of their market.
By the way, "market segmentation" refers to the very specific identification and understanding of these 'places', what they want, and how they buy.
Promotion: -n. The process of trading in a market
Ultimately, you will be ready to promote your product: to find new prospects and draw them in. The types of promotion that are available to the strategic marketer have not changed much since the invention of the telephone (telemarketing).
But, there has been an amazing amount of new creative ways of applying the fundamentals to best suit products and market segments. Can you think of appropriate and creative ways to apply the fundamentals (some examples are included) listed below?
Before selecting a promotional avenue, many marketers will first decide on Product, Price and Place. You may wish to review the following web page, Marketing Strategy.
Try to understand who your prospects are and why they buy. Review their budget and risk level. After doing at least that much, decide on appropriate promotional avenues that make sense. Then, finally, decide on creative ways to apply promotional programs. I personally think its often a mistake to do what many do, and begin with the creative work first.
Price: -v. To sell in a market
A market price has nothing to do with you or your company. Its incredible how few people fail to appreciate this simple truth.
A graduate professor in Financial Management taught us several different ways to precisely determine the cost of a product. Then he asked the class, "Ok, we have an example of a company that manufactures a product that costs $1.00. At what price can this company sell the product?"
Out came the calculators, "For $1.65. At this particular company, that will cover the cost of taxes, goods sold, manufacturing, overhead, marketing, depreciation, and still provide a 5% net income, which is better than the average in this particular market!"
The professor calmly stated, "No," ...
You may sell your product at any price the customer is willing to pay.