FORM SIX COMMERCE – MARKETING

GENERAL MARKETING OF MANUFACTURED GOODS

Manufacturers sell goods to the final consumers in any of the following ways;

1. Selling directly to the final consumers through their own retail outlets.
2. Selling to the wholesalers who then sell to small scale retailers who also sell to the final consumers.
3. Selling to the wholesalers who then sell to large scale retailers who have to sell to final consumers
4. Selling to large scale retailers who then sell to final consumers.

 

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MARKETING

The concept of marketing v/s market

Marketing comes from the term market. Therefore marketing is the total system of interacting business activities designed to a product planning, promotion and nglish-swahili/distribution” target=”_blank”>distribution which will satisfy present and potential buyers of goods or services to be produced. A person who does marketing is known as marketer.

OR

Marketing is the business process by which products are matched with the market and through which transfer of ownership is affected.

OR

Marketing refers to central activities of commercial enterprises that engaged in providing goods and services to the market.

WHILE

A market is a place where buyers and sellers meet and exchange will take place.

OR

Market is the relationship between buyers and sellers and no matter how they communicate each other.

ELEMENTS OF MARKETING ACTIVITIES

These are the requirements for marketing process to occur. It involves the following

1. There must be two or more parties to be involved
   
2. There should be needs or wants to be satisfied
   
3. There should be products or services to be exchanged and create satisfaction
   
4. There should be something in value to exchange
   

 

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IMPORTANCE OF MARKETING

Why business firm engage in marketing activities?

The importance of marketing in a business firm can be divided into three aspects as follows

• To the buyers.
  
• To the producers (suppliers).
  
• To the nation (country’s economy).
  

 

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IMPORTANCE TO THE BUYERS

1. It helps them to get product they require at the right quality, quantity, place, time and vender (seller).
   
2. It enables them to get the right information about the product changes, design, views and features.
   
3. It enables them to get a wider choice (varieties) for the best products among many products of different producers.
   
4. Enables them to acquire goods or services at an acceptable price.
   
5. Enable them to benefit from reliable and permanent flow of goods from producers thus stabilize market and price.
   

 

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IMPORTANCE TO THE PRODUCERS (SUPPLIERS)

1. It helps them to sell their products at the right consumers who are ready to buy and pay the price accordingly.
   
2. It helps them to get information as regards to product they produce whether liked or disliked, whether fast or slow moving items.
   
3. It enables them to raise the level of productivity hence achieving economies of scale.
   
4. It enables them to obtain economic value of goods hence provide the business with potential income and surplus.
   

 

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TO THE NATION

1. It acts as a tool of economic growth of a country.
   
2. It offers employment opportunities
   
3. It brings about the integration of various economic sectors like transport, industries.
   
4. It makes full utilization of resources of existing assets and other products.
   
5. It contributes to the development of entrepreneur and managerial class of people.
   

 

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TYPES OF MARKETING

We may classify market into 3 groups

1. According to demand state.
   
2. According to the nature of products.
   
3. According to the firm marketing scale.
   

   ACCORDING TO THE DEMAND STATE

 

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The following types can be found

1. Negative demand.
   
2. Latent demand.
   
3. Flattering demand.
   
4. Irregular demand.
   
5. Full demand.
   
6. Overfull demand.
   
7. Wholesome demand.
   

   ACCORDING TO THE NATURE OF PRODUCTS

 

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The following types can be found

1. Primary marketing.
   
2. Secondary marketing.
   
3. Service marketing.
   
4. ACCORDING TO THE FIRM MARKETING

 

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The following types can be found

1. Macro marketing.
   
2. Micro marketing.
   

   MARKETING FUNCTIONS
   

   Marketing involves certain activities starting from product designing to after sales services. Marketing function are classified as:
   

   1. Exchange functions.

    

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                a. buying and assembling
   

                b.selling
   

        2. Physical functions.
   

                 a.Storage
   

                 b. Transport
   

                 C.Product planning and development
   

        3. Facilitating functions.
   

             a. Financing             
   

             b.Risk-bearing
   

             c.Standardisation
   

             d. Marketing research
   

             e. Promotion
   

            f. After sales services
   

   1.PRODUCT PLANNING AND DEVELOPMENT
   

   This is the function on which translates the customers demand by making sure production follows market requirement e.g. production of high quality products.
   

   Planning: is the setting out goals which are to be accomplished in future .it can be forecasting the size of the market, sales volume etc.
   

   Development: the conversion of ideas into a physical or recognizable product or improvement over the existing products.
   

   2. BUYING: Buying may be done either directly or through middlemen. Through buying the buyer gets the title to the products.
   

   3. ASSEMBLING: a collection of goods from different sources at a place for further movements. When goods are bought from different producers scattered over a wide area they are assembled together at a central place.
   

   4. SELLING: The primary objectives of marketing is to sell the products at a profit.
   

   5. TRANSPORTATION: When there is a distance between the production place and consumption place movements of goods is very essential. Goods are sent to the market through land, sea and air.
   

   6. STORAGE: Products are preserved from the time of production to the time of consumption .Production may be during a particular season but demand is regular.
   

   7. FINANCING: Funds are required to hold the stocks and to meet the cost of marketing .There are various kinds of finance needed-short term, medium term,longterm and sources are commercial banks cooperative credit societies and other agencies.
   

   8. RISK-BEARING: in marketing there arise numerous risk e.g. damage to goods, physical loss, changes in values of goods.
   

   9. STANDARDISATION: Division of commodities into distinct groups. Standards are set for providing certain basic qualities to the goods for their use.
   

   10. PROMOTION: is a wide term including advertising, personal selling, sales promotion, publicity and public relations.
   

   11.MARKETING RESEARCH: is objective and systematic collection, recording, analysing, nglish-swahili/interpreting” target=”_blank”>interpreting, and reporting about existing or potential markets, marketing strategies and tactics to the applied in different markets.
   

   MARKETING RESEARCH

   This is a set of techniques for obtaining, analyzing and collecting information about the market with a view of planning sales in that market
   

 

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                    OR

Is an action of finding out ideas of the consumers about what they say on product or services produced and consumed by them

Types of marketing research

1. Desk research: is the preliminary research where analysis of published information is made from materials obtained from different publications such as government publications independent research and institutions.
2. Internal research: This involves analysis of own records related to the performance of business examples production report, sales report and financial report.
3. Consumer research; this is a field survey checking the buying habit and preferences of consumers at the point of sale.it is conducted to obtain the reasons as to what they buy and how they buy.
4. Motivation research: This involves establishing true reasons for buying a product and such reasons help the manufactures to base their advertisements campaign and improve quality of goods.
5. Product research: It is conducted to determine the acceptability of products in terms of features such as quality, colour, size and tastes.
6. Advertising research: is conducted to determine the popularity and effectiveness of different media. It also provides details about readers, viewers, listeners, and social characteristics.
7. Distribution research:is done to determine (middlemen) are ready (keen) or not ready to distribute manufactured products.

 

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OBJECTIVES OF MARKETING RESEARCH

1. To know what product can be marketed i.e. right quality, type, packing, color etc.
   
2. To know who are the buyers i.e. age, status, purchasing power, economic group etc.
   
3. To know how much to be marketed i.e. the amount to be supplied accordingly.
   
4. To know when goods are bought i.e. the right time to supply the products.
   
5. To know how can the goods be marketed i.e. the selling techniques to be applied e.g. super markets, peddlers etc.
   
6. To know who are the competitors and how to compete with them.
   

 

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SOURCES OF INFORMATION ON MARKETING RESEARCH

What are the sources of information?

The following are the sources of information for carrying out marketing research

• From the buyers (consumers)
  
• Middlemen (intermediaries)
  
• Trade fairs
  
• Trade association
  
• Chamber of commerce
  
• N.B.S (National Bureau Statistics)
  
• Other sources
  

 

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Marketing research process

What are the steps?

In doing market research, the following process or steps/stages should be followed sequentially

1. Defining the problem and research objective
   
2. Developing research plan
   
3. Collecting the information
   
4. Develop research design
   
5. Analyze the information
   
6. Presenting the findings (research report)
   

 

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WAYS OF CONDUCTING RESEARCH

The following can be used to get information from different sources. It includes

1. Interview
   
2. Questionnaire
   
3. Observation
   
4. Experiment
   
5. Survey
   
6. Mailing
   

 

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RESEARCH SAMPLES

What is research sample?

A sample is a unit that is used to provide data (information) required for the problem researched for. Among the samples to be used include;

• Random sample
  
• Cluster sample
  
• Stratified sample
  
• Systematic sample
  
• Judgmental sample
  
• Convenience sample
  

 

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Merchandising Activities

This refers to all activities necessary to make available to the market goods or services that will satisfy/ fit the needs of consumers and create demand to them. It includes the following activities;

1. Product planning and development
   
2. Buying and assembling
   
3. Standardizing and grading
   
4. Pricing
   
5. Selling
   
6. Packing and packaging
   
7. Sales and promotion
   

 

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HOW THOSE ACTIVITIES MAKE AVAILABLE GOODS AND SERVICES TO THE MARKET

1.PRODUCT PLANNING AND DEVELOPMENT

Is the strategy used in marketing to identify and design the product according to the buyers needs. Also it involves the process of developing the product into 4 stages of;

1. Introduction
   
2. Growth
   
3. Maturity
   
4. Declining
   

 

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2.BUYING AND ASSEMBLING

What is buying?

This is the procurement of goods for final re sale to consumers or industrial users. It is a first step in marketing whereby either finished products or assembled items are being done before use

What are the methods of buying?

1. Buying by inspection
   
2. Buying by description
   
3. Buying by sample
   
4. Buying by grade
   

 

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3.STANDARDIZING AND GRADING

→Standardizing;   is the way by which products or services can be measured in terms of weight, length and performance in the market.

→Grading;   is the way of measuring the product in terms of quality and use.

What are the advantages and disadvantages of standardizing and grading?

1. It facilitates quality control.
   
2. Better price can be obtained for a well graded product.
   
3. Price can be quoted for buyers goods.
   

 

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4.PRICING

This is the process of setting/fixing amount of money(value) on product or services in terms of standard or grade. The following mechanisms can be used in setting prices of products or services

1. Discounting pricing
   
2. Loss leader pricing
   
3. Discriminatory pricing
   
4. Odd pricing
   
5. New product penetration pricing
   
6. Discounting Pricing

 

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Setting a price below the cost in looking about bulk purchase, quick payment, quality and seasonal. Therefore; discount pricing can be

• Trade discount
  
• Cash discount
  
• Quantity discount
  
• Seasonal discount
  
• Loss Leader

 

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Setting a price either at or below cost with the intention of inviting people into the shop where they can buy other goods too.

1. Discriminatory Pricing

 

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Is where the price differ from buyer depending on the frequency for the shop and quantity opt.

2. Odd pricing

Setting a price at queer number (odd number) for example 9’099 or 9’999’999.

3. New product planning

Where the product sold at the highest price when is new in order to gain profit for the newness (skinning the cream).

4. Market Penetration Pricing

Where the product sold at the lowest price when it is new in order to gain famousness.

5. Selling Concept

This is a personal or impersonal process of assisting or persuading consumers to buy a product or services. Normally selling will involve two important things known as

→Branding:Is a process of designing names, marks, symbols, colour which are given to products.

→Trade mark:Is a brand which is given legal protection, it gives exclusives right to the owner to use the brand after it has been registered.

a)Brand

Is a name, symbol, term or design mark, colour or combination of them which is used to identify and differentiate goods or services of one seller to the other competitors.

What are the advantages of branding to consumers, manufacturers, wholesalers and retailers?

To Consumers

• Quality goods are easily available.
  
• Protect them from price hike (charged more price).
  
• Stabilized price.
  
• Branded products are mass produced and are easily available.
  

 

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To Manufacturers      

• Help them to distinguish his products with that of competitors
  
• Help them in widening and nglish-swahili/distribution” target=”_blank”>distribution of products with that of competitors.
  
• Easy to control price in the market
  

 

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To Retailers and wholesalers

• -Less time is required to sell the product
  
• -It facilitates the introduction of new product that creates demand (dd)
  
• -Assure market demand and control market share
  

 

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NOTE: Trademark is a brand name that given legal protection therefore, all trademarks are brands but all brands are not trademark

1. PACKING AND STORING PACKAGING

 

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What is packing?

This is the wrapping and crating of goods before they are transported or stored in papers, boxes or bags so as to preserve against wastage, spoilage or damage before delivery to buyers

While

Packaging is the placing of goods in small packages like containers, boxes, bottles etc before sell to ultimate consumers

Why do we need packaging and packing? (reasons)

• To protects goods from damage while in transit
  
• To prevent the volatile products (dangerous) like gas, spirit, petrol from evaporation
  
• To protects goods against spoilage and leakage
  
• To protect goods against pilferage i.e minor theft
  
• To protect the quality of the goods 
  

 

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What are the qualities of good Package (6Ps)? 

1. Proportional: size of the package should be proportion to the nature and characteristics of a product.
   
2. Protection:Package must be designed in a such a way that products are protected from damage,evaporation, spoillage,leakage.
   
3. Promotion A good package should facilitate advertising and sales promotion and be able to be used in displaying.
   
4. Presentation; A package should be presentable in the eye of the customers. 
   
5. Preservation; A package should be maintain quality of product over fairly a longer time.
   
6. Portable; A package should be made of materials that can facilitate handling transport and storage of a product e.g. light but durable material.
   

 

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What are the advantages of packing and packaging of goods?

1. It possess product prestige.
   
2. It stimulates demand of prospective consumers.
   
3. It creates product differentiation in the market.
   
4. Protects products on their way to consumers.
   
5. Packages ensure hygiene.
   
6. Packed products are convenient to carry.
   
7. SALES AND PROMOTION

 

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This is the way of motivating sales by applying different tools so as to attain higher turnover of product and getting better profit. It includes the following tools

1. Personal selling
   
2. Free sample
   
3. Gifts and rewards
   
4. Trade fair
   
5. Publicity
   
6. Advertising
   

 

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What are the advantages of sales promotion?

1. To make product get market
   
2. To increase turnover
   
3. To create awareness
   
4. Increase market share