Introduction Introduction to to

MarketingMarketing

Eric StormerEric Stormer

Factors to consider when marketing Factors to consider when marketing products.products.

Demand for the product to be Demand for the product to be produced;produced;

Supply of the product available;Supply of the product available; Types and availability of markets in the Types and availability of markets in the

area;area; Competition from similar products;Competition from similar products; Buying power of intended consumers; Buying power of intended consumers;

andand Seasonal variations in demand.Seasonal variations in demand.

Consumer DemographicsConsumer Demographics

Used to target population – determine who Used to target population – determine who will be exposed to the product.will be exposed to the product.

Are helpful in determining marketing Are helpful in determining marketing strategies.strategies.

Categories include: population density, Categories include: population density, ethnic makeup, age, family income, ethnic makeup, age, family income, discretionary money, eating preferences, discretionary money, eating preferences, clothing preferences, styles, occupation.clothing preferences, styles, occupation.

Advertising and PromotionAdvertising and Promotion

Advertising – any form of Advertising – any form of nonpersonal presentation of a nonpersonal presentation of a product or service.product or service.

For maximum effectiveness, must be For maximum effectiveness, must be coordinated with other marketing coordinated with other marketing techniques, including public techniques, including public relations, promotional programs, relations, promotional programs, pricing, personal selling, product pricing, personal selling, product description and characteristics, sales description and characteristics, sales promotions, and warranties.promotions, and warranties.

Product AdvertisingProduct Advertising

Focuses on the Focuses on the product itself.product itself.

Might include Might include information about: information about: product’s product’s usefulness, usefulness, durability, price, durability, price, value, and value, and customer’s needs customer’s needs for the item.for the item.

Institutional AdvertisingInstitutional Advertising

Is designed to create a favorable Is designed to create a favorable image of the firm or institution image of the firm or institution offering the products or services.offering the products or services.

Likely to claim financial stability, Likely to claim financial stability, longevity, reliability and integrity of longevity, reliability and integrity of the company or institution and its the company or institution and its employees.employees.

Advertising efforts that seek to Advertising efforts that seek to find NEW users for a product are find NEW users for a product are

trying to create trying to create PRIMARY DEMANDPRIMARY DEMAND..

Advertising efforts intended to Advertising efforts intended to attract buyers of a SPECIFIC attract buyers of a SPECIFIC

BRAND of product are trying to BRAND of product are trying to create create SELECTIVE DEMANDSELECTIVE DEMAND..

Betty CrockerBetty Crocker

Calvin Klein sells image, sex appeal and sometimes, clothing.

Selling an Experience!

“The Beer of Bavaria.”

Pricing StrategiesPricing Strategies

Commodity Pricing to Commodity Pricing to maximize profits.maximize profits.

Prestige PricingPrestige Pricing Used to target buyers Used to target buyers

desiring quality, desiring quality, fashion or image.fashion or image.

The customer’s The customer’s perception that a perception that a certain brand is better certain brand is better may be reinforced may be reinforced with a higher price with a higher price tag.tag.

Often used in garment Often used in garment and cosmetic and cosmetic industries.industries.

Psychological PricingPsychological Pricing Designed to Designed to

make a price make a price seem lower or seem lower or less significant less significant than it is.than it is.

May lure May lure customer to customer to buy more than buy more than needed to needed to save a small save a small amount.amount.

Penetration PricingPenetration Pricing

Designed to Designed to capture a share of capture a share of the market quickly.the market quickly.

Initial profits are Initial profits are purposely low, and purposely low, and can be regained if can be regained if new customers new customers continue to buy - continue to buy - prices are prices are gradually raised.gradually raised.

Loss-leader PricingLoss-leader Pricing

Where a popular Where a popular commodity is offered commodity is offered for sale in a special for sale in a special sales promotion and sales promotion and sold at a loss.sold at a loss.

Purpose is to attract Purpose is to attract customers into the customers into the business in hopes that business in hopes that they will buy other they will buy other profitable items.profitable items.

Skimming (the cream)Skimming (the cream)

Here, the price of a Here, the price of a product is set for product is set for unusually high initial unusually high initial profit to recoup costs profit to recoup costs of research and of research and development.development.

Prices are gradually Prices are gradually lowered as competing lowered as competing products are products are introduced.introduced.

Marketing Strategies for Marketing Strategies for Maximizing ProfitsMaximizing Profits

Determine what types of markets are available to Determine what types of markets are available to you.you.

Determine the costs of various types of marketing.Determine the costs of various types of marketing. Determine transportation costs to market at each Determine transportation costs to market at each

of the markets available to you, and sell where of the markets available to you, and sell where transportation costs are favorable.transportation costs are favorable.

Determine the most profitable form in which to Determine the most profitable form in which to market your product.market your product.

Advertise to create markets where none existed Advertise to create markets where none existed before.before.

In seasonal markets, market your product at the In seasonal markets, market your product at the peak of demand.peak of demand.

Retail MarketingRetail Marketing

Retail MarketingRetail Marketing

Retail marketing is Retail marketing is selling a product selling a product directly to end directly to end consumers - people consumers - people who use the product.who use the product.

Agricultural retail Agricultural retail marketing is marketing is generally used for generally used for ready-to-eat ready-to-eat products.products.

Retailing at the FarmRetailing at the Farm Requires that the Requires that the

farm be well farm be well maintained.maintained.

Must provide Must provide parking, sales staff; parking, sales staff; may include may include educational educational programs.programs.

Profits are often Profits are often higher.higher.

Roadside MarketsRoadside Markets

Roadside marketing Roadside marketing removes customers removes customers from the production from the production area. area.

Facility maintenance Facility maintenance is not as important.is not as important.

Separate sales Separate sales facilities must be facilities must be maintained.maintained.

Farmers’ MarketsFarmers’ Markets

Farmers’ MarketsFarmers’ Markets

Have appeared in large, metropolitan Have appeared in large, metropolitan areas, catering to urban consumers.areas, catering to urban consumers.

Generate over one billion dollars in Generate over one billion dollars in sales annually.sales annually.

Often must pay fees to sell in the Often must pay fees to sell in the market.market.

Competition may be higher.Competition may be higher. May need special vehicles to May need special vehicles to

transport goods.transport goods.

Wholesale MarketingWholesale Marketing

Wholesale MarketingWholesale Marketing

The marketing of a product through The marketing of a product through a middleman, who eventually a middleman, who eventually forwards it to a consumer.forwards it to a consumer.

Most agricultural products in the U.S. Most agricultural products in the U.S. are sold this way.are sold this way.

Types of wholesale markets include: Types of wholesale markets include: Terminal Markets, Auction Markets Terminal Markets, Auction Markets and Direct Sales.and Direct Sales.

Terminal MarketsTerminal Markets

Terminal MarketTerminal Market

Usually a stockyard Usually a stockyard that where animals that where animals are held until they are held until they are sold to another are sold to another party.party.

Animals are sold on Animals are sold on consignment.consignment.

Seller pays Seller pays yardage and yardage and commission fees.commission fees.

Auction MarketsAuction Markets

Animals are sold by public bidding on individual Animals are sold by public bidding on individual lots of animals.lots of animals.

The Auctioneer generally conducts the sales.The Auctioneer generally conducts the sales. Video merchandising is also used.Video merchandising is also used.

Direct SalesDirect Sales

Direct Sales refers Direct Sales refers to the producer to the producer selling crops and selling crops and animals directly to animals directly to processors.processors.

Advantages include Advantages include no commission no commission fees to pay, no fees to pay, no yardage fees.yardage fees.

Dairy CooperativesDairy Cooperatives

The EndThe End