Dowansizing

In a business enterprise, downsizing is reducing the number of employees on the operating payroll. Some users distinguish downsizing from a layoff , with downsizing intended to be a permanent downscaling and a layoff intended to be a temporary downscaling in which employees may later be rehired. Businesses use several techniques in downsizing, including providing incentives to take early retirement and transfer to subsidiary companies, but the most common technique is to simply terminate the employment of a certain number of people.

Rightsizing is downsizing in the belief that an enterprise really should operate with fewer people. Dumbsizing is downsizing that, in retrospect, failed to achieve the desired effect.

Maaarketing process

Marketing process model contain five steps. which are as follow

(1) Market and environment analysis
(2) Fixing marketing target
(3) Setting marketing strategy
(4) Marketing Mix
(5) Marketing controlling

Product Development

Product development is the incubation stage of the product life cycle. There are no sales and the firm prepares to introduce the product. As the product progresses through its life cycle, changes in the marketing mix usually are required in order to adjust to the evolving challenges and opportunities.

Introduction Stage

During the introduction stage, the primary goal is to establish a market and build primary demand for the product class. The following are some of the marketing mix implications of the introduction stage:

• Product - one or few products, relatively undifferentiated
• Price - Generally high, assuming a skim pricing strategy for a high profit margin as the early adopters buy the product and the firm seeks to recoup development costs quickly. In some cases a penetration pricing strategy is used and introductory prices are set low to gain market share rapidly.
• Distribution - Distribution is selective and scattered as the firm commences implementation of the distribution plan.
• Promotion - Promotion is aimed at building brand awareness. Samples or trial incentives may be directed toward early adopters. The introductory promotion also is intended to convince potential resellers to carry the product.

Growth Stage

The growth stage is a period of rapid revenue growth. Sales increase as more customers become aware of the product and its benefits and additional market segments are targeted.

During the growth stage, the goal is to gain consumer preference and increase sales. The marketing mix may be modified as follows:

• Product - New product features and packaging options; improvement of product quality.
• Price - Maintained at a high level if demand is high, or reduced to capture additional customers.
• Distribution - Distribution becomes more intensive. Trade discounts are minimal if resellers show a strong interest in the product.
• Promotion - Increased advertising to build brand preference.

Inportance of Test Marketing

I want to discuss the importance of testing a product’s market appeal BEFORE spending money to launch a new business and an advertising campaign.

Quite possibly the biggest mistake people make in business is they spend all of their money building a new product and opening a business BEFORE they test the market to see if consumers really want this new product. Many people have lost their life’s savings and have gone bankrupt by starting a new business to sell a new product before testing to determine if consumers even want the product.
You can never know the public’s response to a product or service without first testing it to see what their reaction will be. Testing is the key to success in marketing. NEVER try to sell a product without first test marketing it to see if consumers really want it.

Business Analysis

Business analysis can make or break an organization, so managers have to ensure that their business analysis models point them in the right direction.

Managers have to know how to do business analysis effectively and know what they are looking for, and also draw the right the conclusions from what they find. Not only that, but they must take the correct action based on that business analysis and structure accordingly.

Everyone learns from their mistakes and the ability to use business analysis to spot errors and correct them is invaluable. This means making the best of what seems to be a bad job.

For example, there was one company that had invested in a new product that ended up making heavy losses because a typical business analysis error had been made: historical data had been extrapolated into the future. They had misread their sales and demand.

The company then embarked on some new business analysis, scaled down production and attacked the market from a different segment. The product then went on to dominate its market sector and became a highly profitable market leader.

Concept Testing

Concept testing is an endeavor used in identifying early on potentially successful products. It focuses on taking into account people’s reaction to a basic idea of the product, helping in making decisions such as pass/fail.

Concept testing is taken place before a product is marketed. Hence, while promising a high probability of consumer acceptance, the attempt minimizes the research and development costs as well as the marketing costs.

The process for concept testing often depends on the type of product being developed, however it can be typically summarized in the following manner:
• Define the purpose of the test
• Choose a survey population
• Choose a survey format
• Communicate the concept
• Measure customer response
• Interpret the results
• Reflect on the results and the process

GM Motors facing problems

http://www.5min.com/Video/Problems-with-General-Motors-204179610


In this video it is explained that GM Motors facing problem from Obama's administration.

Product Concept

The product concept includes everything from the decision to make a product to the final packaging and branding.

Under this concept, the first thing that is considered is the function that the product is going to serve. It is also reviewed as to how many models or sizes or variants the product is going to have. This product can be a physical good or a service.

After the product has been manufactured, the quality assurance is done and the packaging is done. The warranty period is also determined and the repair and support system is also considered.
The above are all the components that formulate the product concept in marketing.

Idea Generation

It is a method of shared problem solving in which all members of a group spontaneously contribute ideas. It is a similar process undertaken by a person to solve a problem by rapidly generating a variety of possible solutions.
By doing brain storming you can generate ideas. As idea-generating technique often used in advertising by a creative team to spark creativity. The team will gather in a group and throw out spontaneous ideas without evaluation until they hit upon something that may be useful. In this process nothing is too silly or farfetched to be suggested. The process helps to make the leap from the visualization of an idea to the concrete words and pictures that will actually form the basis of the advertising campaign.

Look at this video it is about idea generation.

http://www.5min.com/Video/Brainstorming-Before-a-Public-Speech-169082868

New Product Development

Preparation for full-scale manufacturing of a product not previously offered by that marketer, including these activities: conceptualization; concept testing and approval; research and development; prototype testing; economic and market research; and decision making with regard to positioning, pricing, packaging, distribution, and promotion. A new product may be a minor or great variation on an existing brand, a true product innovation, or an imitation of a product already on the market. New product development is necessary to maintain market share because demand for most brands or products tends to decline over time. New product development is also a necessary response to new technology and changing market conditions. New product development may be handled by a dedicated department within the company or may be part of each brand manager's responsibilities.

There types of service marketing

Service marketing involves 3 types of marketing:


1. EXTERNAL MARKETING
2. INTERNAL MARKETING
3. INTERACTIVE MARKETING

1. External Marketing: "Setting the Promise"
• Marketing to END-USERS.
• Involves pricing strategy, promotional activities, and all communication with
customers.
• Performed to capture the attention of the market, and arouse interest in the service.

2. Internal Marketing : "Enabling the Promise"
• Marketing to EMPLOYEES.
• Involves training, motivational, and teamwork programs, and all communication with
employees.
• Performed to enable employees to perform the service effectively, and keep up the
promise made to the customer.

3. Interactive Marketing : (Moment of Truth, Service Encounter)
• This refers to the decisive moment of interaction between the front-office employees
and customers, i.e. delivery of service.
• This step is of utmost importance, because if the employee falters at this level, all prior
efforts made towards establishing a relationship with the customer, would be wasted.

Types of marketing

If you want your company to succeed, at some point you will need to begin marketing your products or services. The old adage that the worst type of advertising is no advertising is still true. No matter what your marketing budget may be, there are many different types of marketing that you can take advantage of. Let's take a look at a few of the more proven techniques that combine low cost with major results.

Online Marketing

Online marketing has opened up incredible avenues for small businesses. Thanks to companies like Google and Overture, you can place ads for your company right along side the big guns at competitive prices. Never before has it been easier to market your business than it is right now.

New forms of online marketing are also making headway. Online video ads are easy and cheap to shoot and give you the kind of exposure that was previously limited to expensive national television campaigns. With low production costs and reasonable pricing, you can run an online video campaign at a fraction of the cost of traditional advertising.

Offline Marketing

The benefits of traditional marketing cannot be overlooked in our digital age. Many companies are reaping the benefits of combining online and offline marketing techniques.

For example, you can use direct mail or local advertising to drive potential customers to your site. This is a great and proven combination that results in increased traffic and better conversions.

The best marketing strategies take advantage of all the different types of advertising. By spreading your ad dollars around you can be assured of greater success and better interaction with the public. Start small by combining a special promotion that will run both in print and online avenues at the same time. You can keep track of the success of each method by using coupon codes to see which form suits your company the best.

Service Marketing

What exactly are the characteristics of a service? How are services different from a product? In fact many organizations do have service elements to the product they sell, for example McDonald’s sell physical products i.e. burgers but consumers are also concerned about the quality and speed of service, are staff cheerful and welcoming and do they serve with a smile on their face?

There are five characteristics to a service which will be discussed below.

1. Lack of ownership.
You cannot own and store a service like you can a product. Services are used or hired for a period of time. For example when buying a ticket to the USA the service lasts maybe 9 hours each way , but consumers want and expect excellent service for that time. Because you can measure the duration of the service consumers become more demanding of it.

2. Intangibility
You cannot hold or touch a service unlike a product. In saying that although services are intangible the experience consumers obtain from the service has an impact on how they will perceive it. What do consumers perceive from customer service? the location, and the inner presentation of where they are purchasing the service?.

3. Inseparability
Services cannot be separated from the service providers. A product when produced can be taken away from the producer. However a service is produced at or near the point of purchase. Take visiting a restaurant, you order your meal, the waiting and delivery of the meal, the service provided by the waiter/ress is all apart of the service production process and is inseparable, the staff in a restaurant are as apart of the process as well as the quality of food provided.

4. Permissibility
Services last a specific time and cannot be stored like a product for later use. If traveling by train, coach or air the service will only last the duration of the journey. The service is developed and used almost simultaneously. Again because of this time constraint consumers demand more.

5. Heterogeneity
It is very difficult to make each service experience identical. If traveling by plane the service quality may differ from the first time you traveled by that airline to the second, because the airhostess is more or less experienced.
A concert performed by a group on two nights may differ in slight ways because it is very difficult to standardize every dance move. Generally systems and procedures are put into place to make sure the service provided is consistent all the time, training in service organizations is essential for this, however in saying this there will always be subtle differences.

Brand extension and brand stretching

Marketers have long recognized that strong brand names that deliver higher sales and profits (i.e. those that have brand equity) have the potential to work their magic on other products.

The two options for doing this are usually called “brand extension” and “brand stretching”.

Brand extension

Brand extension refers to the use of a successful brand name to launch a new or modified product in a same broad market.
A successful brand helps a company enter new product categories more easily.
For example, Fairy (owned by Unilever) was extended from a washing up liquid brand to become a washing powder brand too.
The Lucozade brand has undergone a very successful brand extension from children’s health drink to an energy drink and sports drink.

Brand stretching

Brand stretching refers to the use of an established brand name for products in unrelated markets.

For example the move by Yamaha (originally a Japanese manufacturer of motorbikes) into branded hi-fi equipment, pianos and sports equipment.
When done successfully, brand extension can have several advantages:

• Distributors may perceive there is less risk with a new product if it carries a familiar brand name. If a new food product carries the Heinz brand, it is likely that customers will buy it

• Customers will associate the quality of the established brand name with the new product. They will be more likely to trust the new product.

• The new product will attract quicker customer awareness and willingness to trial or sample the product

• Promotional launch costs (particularly advertising) are likely to be substantially lower.

Co-Branding

Co-branding is the practice of using multiple brand names together on a single product or service. The term can also refer to the display of multiple brand names or corporate logos on a single Web site, so that people who visit the site see it as a joint enterprise. When effectively done, co-branding provides a way for companies to combine forces so that their marketing efforts work in synergy.

Co branding has become fashionable, not all alliances should be made visible.

- In the car industry, although the rover company is now owned by BMW, at the product level Rover cars show no BMW insignia. Mercedes and Swatch have created a joint venture to produce and market a revolutionary new car, called Smart, to which each company will add its specific expertise. However, Mercedes is unlikely to put its trademark on the smart!

- To conquer the iced tea market (depite late entry), Nestle and coca Cola decided to unite against Unilever’s Lipton range. Nestle would create and market the product, and Coca Cola would distribute it. The product, called Nestea, is not co-branded, though the Coca Cola company gets only a small mention on the back of the packaging.

Line Extension

Multiproduct branding strategy whereby a firm markets one or more new products under an already established and well known brand name. The objective is to serve different customer needs or market segments while taking advantage of the widespread name recognition of the original brand. For example, maker of a popular perfume may introduce shampoos, bath soaps, body powders, etc., under the perfume's name. Line extension is encouraged by some marketing experts and frowned upon by others. Also called brand extension.

Private Brand

The concept of private brands has been around for many decades. As early as the middle of the 19th century, there is evidence of the first major department stores contracting with suppliers to private label some of the goods that were sold on store shelves. The trend has continued on to this day, with some of the most well-known retailing entities sometimes attracting customers based on the quality of their house or store brands as well as their selection of national brands.

Retailers who market private brands benefit from the activity in several ways. First, there is no need to establish manufacturing facilities in order to produce the goods or services offered. The retailer does not have to hire additional employees, deal with the acquisition of raw materials, or arrange for storage space for finished goods until they are sold to a customer. Because someone else is dealing with details of that type, the overhead for the retailer is significantly less than if the business attempted to produce the goods on its own.

Another advantage to the use of private brands is that the retailer does not have to sink a great deal of time and money into the research and development of new product lines. The manufacturers who produce the goods and arrange for the private labeling engage in that type of activity, then offer the retailer the opportunity to private brand any new products or services the supplier decides to market. Often, the retailer is made privy to the results of field testing and the identification of the niche market where the good or service is likely to generate interest, and can determine if they wish to go after that particular market sector.

For the manufacturer, private brands also provide another outlet for distributing their products or services. By producing the same goods as for their national brand distribution and labeling them with private brands for various clients, the volume of production is often higher than it would be otherwise. This translates into more net profit for the manufacturer in the long run, helping the business to remain stable even in tough economic times.

Brand equity and brand value

In a market where products are similar, branding can have a large effect on the price that customers will pay. Brands therefore add value to a basic product or service by enabling the product or service to command a higher price, or higher market share than an unbranded equivalent. The term Brand equity is used to describe both the value of the brand and the brand's component values. It's value may be a monetary value (which may be discounted to a net present value), an increase in a rate of return or any number of softer market research measures such as awareness or consideration.

A common question is how much does the brand add and consequently, what is the value of the brand? There are a number of methods for calculating brand value and so inferring brand equity.

Retailing

Retailing is a distribution channel function where one organization buys products from supplying firms or manufactures the product themselves, and then sells these directly to consumers. A retailer is a reseller (i.e., obtains product from one party in order to sell to another) from which a consumer purchases products. In the US alone there are over 1,100,000 retailers according to the 2002 US Census of Retail Trade.

In the majority of retail situations, the organization from which a consumer makes purchases is a reseller of products obtained from others and not the product manufacturer. But as we discussed in the Distribution Decisions tutorial, some manufacturers also operate their own retail outlets in a corporate channel arrangement. While consumers are the retailer’s buyers, a consumer does not always buy from retailers. For instance, when a consumer purchases from another consumer (e.g., eBay) the consumer purchase would not be classified as a retail purchase. This distinction can get confusing but in the US and other countries the dividing line is whether the one selling to consumers is classified as a business (e.g., legal and tax purposes) or is selling as a hobby without a legal business standing.

Wholesaling

Wholesaling is a distribution channel function where one organization buys products from supplying firms with the primary intention of redistributing to other organizations. A wholesaler is an organization providing the necessary means to: 1) allow suppliers (e.g., manufacturers) to reach organizational buyers (e.g., retailers, business buyers), and 2) allow certain business buyers to purchase products which they may not be able to otherwise purchase. According to the 2002 Census of Wholesale trade, there are over 430,000 wholesale operations in the United States.

While many large retailers and even manufacturers have centralized facilities and carry out the same tasks as wholesalers, we do not classify these as wholesalers since these relationships only involve one other party, the buyer. Thus, a distinguishing characteristic of wholesalers is they offer distribution activities for both a supplying party and for a purchasing party. For our discussion of wholesalers, we will primarily focus on wholesalers who sell to other resellers such as retailers.