Marketing mix Essay Example

Marketing mix Essay In this assignment I will go through how marketing mix is applied to service or a product for two organisations called KFC and Mc Donalds. I will choose a product from each of these businesses and the talk about the product, price, promotion and place. Marketing mix Marketing mix consists of 4ps. These are product, price place and promotion all offered by an organisation to potential customers. The marketing mix is a set of tools that work to achieve companys objectives. Price The price is the amount a customer pays for the product. The price is determined by a numbers of aspects, which are material costs, market share, product identity and the customers thought of the product price. Price is determined by what customers notice about the price of the product. Researching about pricing is important because it indicates what customers are looking for as well as what they want to pay. For example Gillette the manufacturer of razors, deodorant and shaving foams seeks to provide the worlds market with products that have affordable prices and targets a particular market segments. Such as young adults who wish to buy low priced razors and deodorant. We will write a custom essay sample on Marketing mix specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Marketing mix specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Marketing mix specifically for you FOR ONLY $16.38 $13.9/page Hire Writer Product products must meet customer requirements whatever these might be. For many products is simple the physical item that customers of businesses might be buying or selling. For example a customer buys a new BMW 6 series, thats the product. Place Place is also known as distribution. It is the system through which products or services are moved from the manufacturer or service provider to the consumer. Different organisations use different approaches to reaching their consumers. For example, McDonalds uses a franchising system which allows the company to operate in many different geographical locations. Promotion Promotions persuades customers to buy their products or offers though communication Promotions has 4 key elements, these are advertising, public relations, word of mouth and point of sale. AN example can be that KFC advertising its new product, the zinger burger on posters with eye catching words will attract young customers. History of McDonalds Siblings Dick and Mac McDonalds opened their first restaurant in San Bernardino, California. The principle of modern fast food restaurant called speedee service system was introduced by them. The original mascot of McDonalds was a man with a chefs hat on top of a hamburger shaped head whose name was speedee. In 1963 speedee was replaced by Ronald McDonald. McDonalds serves nearly 48 million customers every day prompting it to become the worlds largest fast food restaurant. Desserts, hamburgers, fries, soft drinks, milkshakes and breakfast food are the primary products that are sold in McDonalds. McDonalds has recently included salad and fruits to its menu as well as a playground for children. Some McDonalds even have a fire place and lounge areas removing plastic chairs and tables. McDonalds is a franchise so each McDonalds is run by a franchisee. The companys revenue comes from the rent, loyalties and fees paid by the franchisees, as well as sales in company operated restaurants. Types of product at McDonalds McDonalds sells primarily beef related fast food products such as cheese burgers, ham burgers, quarter pounder and their signature product the Big Mac. But now due to customer trends changing they have now included salads in their menu as well as different types of food such as oriental snack wraps and egg sausage burgers. McDonalds also sells ice cream which is often called McFlurry. All of McDonalds food is relatively cheap and is aimed at different types of people, young and old. Product McDonalds sells several many fast food products, the products I have chosen is cheese burger. The retail price of the product is 99p. The packaging is foam, plastic shaped as a box which can be opened, but now McDonalds have changed the packaging into yellow paper for some stores. This is because the packaging was causing pollution and wasting a lot of resources. McDonalds continues to design more efficient packaging and by promoting the use of recycle content material. The beef of the burger is not made on site but is delivered to the restaurant. The burger contains 100% pure beef with a single pickle, rehydrated onions, on a toasted bun. McDonalds beef is bought from farms accredited by nationally recognised farm assurance schemes. McDonalds can trace which farms the beef came from, and know the farmers name and how the animals were raised. At the supplier the meat is checked for a date and batch number. The quality of the meat is checked by the staff to ensure that it is at top quality. If the quality is bad then they wont use it. The cheese burger is aimed mostly at young adults and teenagers. McDonalds has a drive through service. People often with cars in the drive through service will receive their meals quickly than those waiting at the queue in the restaurant. Price The retail price of a cheese burger is 99p. The price has been set to make customers believe they are actually saving money but they are only saving 1pence. Psychological pricing is used to play on customers views. This is very effective as the consumer is tricked into thinking that the burger is cheaper than 1 pound. Then comes the cost- plus pricing, this is when you calculate the average cost plus a mark up to see if they made any money on top. The price of the product does change. Cheese burger price may increase if the costs of dairy products and beef rise. So some stores will need to raise the price of the cheese burger and other products to counter financial loss. Other businesses competing with McDonalds will have a difficult time competing with McDonalds, especially private businesses. A cheese burger in high street fast food restaurant like PFC (perfect fried chicken) will sell cheese burger at à ¯Ã‚ ¿Ã‚ ½1.10 or more. Customers will go to McDonalds rather than these shops because they will be saving money in McDonalds. Place McDonalds are located primarily in public places where there are a lot of busy roads and people shopping for example Oxford Street. Oxford Street is a location in west London where many people go and spend hours buying clothes and food. This kind of location will increase the demand of their products and services because many customers will be coming in the restaurant to place an order. A busy place will always increase sales. McDonalds is also located in most shopping centres in the UK. McDonalds have relatively few sites on the motorway due to less demand of customers. These McDonald restaurants will often have a drive though service so customers can buy their products quickly. Promotion Some McDonalds restaurants do 3 cheeseburger for the price of 2. So customers will pay less. McDonalds also promote their business and products such as their cheeseburger offers through billboards, TV and internet. By doing this, McDonalds will attract as much customers as they can. McDonalds also accepts vouchers, such as buy one cheeseburger and get one free. Almost all restaurants accept these vouchers but when the vouchers expire it cannot be used anymore. History of KFC Colonel Harland Sander bought a motel and cafe in Corbin, Kentucky in the 1930s. Colonel sanders had done several jobs such as railroading and operating a steam powered ferryboat but he always loved cooking. There was nothing special about fried chicken, Colonel found a way to combine 11 herbs and spices with flour to create a finger licking good coating. The dining area in Corbin was named Sanders and cafe and was so successful that Ruby Laffon governor of Kentucky gave the title of honorary Kentucky colonel to sanders in recognition of his contribution to the states cuisine. At a time when most businesses were getting bankrupt and struggling Colonels business and reputation increased. But he was forced to sell his restaurant when a new interstate Highway was built through his property. Colonel Sanders at the age of 66 travelled the US with his new plan of created a franchise. Small and independent restaurants were taught by Colonel to cook Kentucky Fried Chicken and his values. He took 5 cent royalty on every chicken sold With most of his deals sealed with only a handshake, there were 838 Kentucky Fried Chicken franchises across the United States by 1964. The Colonel was now in his 70s and Kentucky Fried Chicken had grown larger than he could realistically handle, so he sold the operation to businessmen John Y Brown Jnr and Jack Massey for $2 million. But there were strict conditions: Colonel Sanders became Quality Controller and his image stayed on as the company trademark. Colonel Harland D Sanders was 90 years old when he died in December 1980. His philosophies and values of hard work and excellent customer service are, and will always be a part of KFC. KFC is currently owned by YUM brands which are the worlds largest fast food restaurant company in terms of system units, over 36,000 restaurants around the world in more than 110 countries and territories. Types of products at KFC KFC sells mostly chicken products these are chicken fillet burger, chicken zinger burger, chicken tower burger, zinger tower burger, and mini fillet burger, kids burger, toasted chicken twister wrap, chicken wings, chicken nuggets, popcorn chicken and also sells salads for healthy options. KFC desserts are Avalanche, yoghurt and Rolo ice cream tub. Product The product I have chosen is chicken fillet burger. The retail price of the product is 1.99p. KFC uses paper packaging which helps the chicken crispy by wicking away excess moisture. The paper package is red with KFC logo in the middle. The chicken of the burger is not made on site but is delivered to the restaurant. 100% chicken breast fillet coated in KFCs secret blend of 11 herbs and spices. KFC checks its suppliers to see if they are using any extra ingredients like antibiotic growth promoters to the chickens. Rearing conditions are also strictly regulated to ensure animal welfare. Welfare and bio security audits are carried out by independent experts. KFC chooses he best quality chicken from its suppliers. Price The retail price of a chicken fillet burger is 1.99p. The price has been set to make customers believe they are actually saving money but they are only saving 1pence. Psychological pricing is used to play on customers views. This is very effective as the consumer is tricked into thinking that the burger is cheaper than 1 pound. Then comes the cost- plus pricing, this is when you calculate the average cost plus a mark up to see if they made any money on top. Place KFC are located mostly in public places where there are a lot o busy roads and people shopping for example Oxford Street or Bethnal green. Street is a location in west London where many people go and spend hours buying clothes and food. This kind of location will increase the demand of their products and services because many customers will be coming in the restaurant to place an order. A busy place will always increase sales. KFC have quite a lot of sites on the motorway due to KFC being popular with drivers. These KFC restaurants will often have a drive though service so customers can buy their products quickly. Promotion KFC has free chicken wings promotion for its UK stores. KFC also promotes there business and products such as their chicken zinger burger one the signature dish of the company in bill boards, TV and internet. By doing this KF will attract many customers as they can. KFC also accepts vouchers, such as free Ice cream. marketing mix Essay Example marketing mix Paper Topic: Marketing-(Nike, Inc. ) Introduction Nike was the Goddess of victory in Greek mythology. In 1978 an athlete runner Philip Knight and his coach, Bill Bowerman renamed their small sportswear company as Nike. Since then, the business has increased dramatically. At present Nike, Inc. has already become a major public traded sportswear and equipment supplier in the United States. It is the worlds leading supplier of athletic shoes and apparel and a major manufacturer of sport equipment with revenue in excess of IJS$ 24,13 billion in last year 2012. (Nike,lnc. reports fiscal 2013) . Nike as a most successful company in the world. It must have a well marketing management that can perfectly identify and anticipates customer requirement and satisfy them. There are many marketing elements that must have led Nike to become such a powerful brand. This study will analyse the Nikes marketing mix and its market orientation, in addition a conclusion for marketing of Nike. Marketing mix According to the concept of marketing mix (Neil Borden 1953), marketing mix was defined as an instrument to analyse product, price, place and promotion in order to establish relationships with customers. Product is seen as an item that can satisfy what a consumer demand that includes tangible goods and intangible service. Promotion means all of the methods of communication that marketers use to deliver information to different communities about the product. Place represents the location where the tangible and/or intangible products are provided for customers. Price is a sum of money that a customer pays for the product. Product: In order to satlsTy tne consumers aemana, NIKe Tlrst provides a w10e range of products that involves all aspects of different sport areas for their customer. We will write a custom essay sample on marketing mix specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on marketing mix specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on marketing mix specifically for you FOR ONLY $16.38 $13.9/page Hire Writer This eans all the customers could be satisfied by Nikes products, no matter what the needs of the people. Nike has all the equipment for them. Secondly, According to the companys mission statement: to bring inspiration an innovation to every athlete in the world, Nike also makes high quality and environmental goods with most new technology, a good example is the basketball shoe, it utilises the Nike Flywire, Nike Zoom, Nike Air technique that loosens or tightens with the natural notion of the foot and provides support, protection and stability. These techniques can ensure the player has greatest performance in the game. Moreover Nike deem fashion is really crucial factor for any products, therefore Nike hire famous designers to design its product and also providing variety of colors and styles for its customers, that makes more and more people are attracted by Nikes product and using them every day, even though they were first designed for athletes. Hence, Nike has perfectly satisfied their customers by supplying a variable, high quality, technological, and fashionable product. Price: Nike uses premium-pricing strategy. The premium pricing strategy is the application of a fixed price based on the quality of the product. This has made Nike o set relatively higher price than its competitors. This strategy focuses on the consumers who think high quality is more important than the cheap price, and also those who like Nike Company more. This means Nike has to spend more money to build a good company reputation and image such as TV advertisement, celebrity endorsement, sponsoring charitable activities. These can be another reasons for the high price products. In fact this strategy seems to be working very well, as most people who choose to purchase Nike commodities accesses that they are ready for their prices since they feel that Nike is reasonable. Hampy, 2006). Place: Nike sells its products directly and also uses distributors and e-commercial. When selling its products directly, the company has created the idea of Nike towns in different parts of the USA, in order to contact with clients directly and can therefore analyse consumer behaviours. This also can help to measure the level of demand for a particular product. These data play a significant role in their marketing strategy. Furthermore, a right method of distribution might help the company save many valuable resources, but there are also many drawbacks, for instance, if Nike hires a elivering company to take commodities to customer. The customer may expect that delivery companies can do it as fast as possible, this may cost Nike a great sum of money to acquire such a good delivery. Moreover, in case the deliveries are damaged or delayed accidently, the clients will tend to blame Nike for the damage or delay, instead of the delivery company. This will harm the reputation of Nike. Lastly, Nike has been using a successful e-commercial over last two decades. The first e- commercial site was launched in April 1999 by providing over 65 styles of sport roducts to the US market for purchasing (Nike, 2013). This helps the promotion of NIKes products all over tne glooe. Promotion: Nike used to sponsor numerous sport celebrities to publicise their product. Such as Kobe Bryant in basketball, Tiger woods in golf, Federer in tennis. This is a really effective approach to improve awareness, and image of the brand. For example, if a celebrity athlete sponsors a specific brand of athletic shoes, the brand will be associated with success. Besides that, there are also many popular Nike advertisement that spread all over the word, however advertisements do have some isadvantages; they do not target specific customers, and information are received by those who happen to be at a certain location, who are likely not to purchase the product, and this may waste the companys resources. However, this may be not happened with Nikes products, as their commodities fit any category of people, as the company mission statement: to bring inspiration and innovation to every athlete in the world, If you have a body you are an athlete. (Bill Bowerman, Nike Co-founder). Additionally, in recent years, because social media is cheap, easy and influential, it provides a crucial promotion platform for Nike. Nike uses Facebook and Twitter to deliver the promotion information to their client, and receives feedback form their customers. This two-way communication can makes Nike select more important and accurate data from customers. All these promotion activities certainly make Nike become the most recognisable brand in the world. Market orientations This theory is to consider the demand and interest of customers, organizations and societies in order to find out which market orientation best suites the company. There are five parts of orientations. 1 . Production-This concept believes that customers prefer products that are both idely available and inexpensive. The marketer should concentrate on reaching high production efficiency, low costs and mass distribution. This concept normally makes sense in developing countries, where consumers only want get the cheap products. 2. Products-This orientation focus on supplying products that provides the best quality, performance and innovative features. However it might sometimes not really fulfill the customer demand. . Selling-This concept means the company is more interested in selling and promoting, they keep promoting their products to stimulate more buying. 4. Marketing-This orientation concentrate on the companys customer needs and what they want in order to makes the company better than its competitors. 5. Social Responsible Marketing-This orientation holds that in order to reach organlsatlons goal, tne organlsatlon not only prov10es a nlgn quallty products, It also should reinforce social and ethical values fore the benefit of citizens. I think there is no doubt that Nike as an organization is market- orientated. According to Phil Knight, COE Nike (2009) answered in an interview that for years we considered ourselves as a product-orientated company however, we now understand the most mportant thing is the consumers as they lead the innovation. They believe that the consumers needs and wants is their most important marketing tool. This can be certainly proved by it offer variety products which cover nearly all areas in order to fulfill different needs of people. A good example is the Nike+ iPod. Nike realised there are some customers used to track their runners space on their iPod, therefore Nike generates some products that have been installed with a radio device that can connect to their iPod and measuring their running distance automatically, however the price does not change that much. Besides that, all Nikes products were designed to be fashionable, this can satisfy those who are not an athlete, but only want a beautiful shoe, then the idea of create you own shoe come out. The customer can design their own shoes on Nike website, the customer can choose and colors and styles they like, and Nike makes it for them. Therefore, no matter who you are, what you want, there always is a Nike product suit you, as you are the most importance for Nike (Phil Knight 2009). This orientation certainly helps Nike earn more marketing, because in the present society, customers have variety of choices. Whether can satisfy the demand of consumers is the most crucial factor to influence the consumer decision-making process. Alet C Erasmus, Elizabeth Boshoff and GG Rousseau2001) Conclusion From the about study, we had understanding the Nike is market orientation company, it deem consumers needs and wants are most crucial elements for its marketing strategy. Besides that, we also analyzed Nikes product, price, promotion, and place base on marketing mix theory. Then we sought out that Nike generates a verity of high quality, fashionable and functional products. And it has buil t a most ecognizable band and a high company reputation and image through by social media, advertisements and celebrity endorsement. These factors lead to Nike became such a successful company. In the future, Nike will continue the principle in order to satisfy more and more customer. world count: 1 Reference: 1. Hampy, J. (2006): Reengineering the Nike Corporation: A Manifesto for Business marketing in Nike, Harper 2. Kohli, A. K. Jaworski, B. J. (1990). Market Orientation: The Construct, Research Propositions, and Managerial Implications. The Journal of Marketing, 54(2),1-18. 3. Ruekert, Robert W. 1992). Developing a Market Orientation: An Organizational Strategy Perspective. International Journal of Research in Marketing, 9(3),225-45. 4. Nike,inc. reports fiscal (2013) fourth quarter and full year results. Available at http://nikeinc. com/news/nike-inc-reports-fiscal-2012-fourth- quarter-and-full-year-results. [accessed 11/08/2013] 5. Nike elevates global e commerce strategy (2013). Available at http://nikeinc. com/news/nike-inc-elevates- global-e-commerce-strategy [accessed 11/08/2013] 6. Ruekert, Robert W. (1992). Developing a Market Orientation: An Organizational Strategy Perspective. International Journal of Research in Marketing, 9(3),225-45. . Phil Knight, CEO Nike on product marketing (2009) available at http://www. marketinginprogress. com/ 2009/04/16/phil-knight-nike-ceo-on-product-marketing/[accessed 1 1108/2013] 8. Borden, Neil H. (1964), The Concept of the Marketing Mix, Journal of Advertising Research, 4 (2), 2-7. 9. Naylor, J. (2004), Management marketing in Management 2ed. prennce Hall, PP 520-554. 10. Erasmus, C, A, Boshoff, E and Roussea u GG (2001), Consumer decision-making models within the discipline of consumer science: a critical approach Journal of Family Ecology and Consumer Sciences, Vol 29.