INTRODUCTION TO MARKETING

Subject: 

COMMERCE

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Term:

FIRST TERM

Week:

WEEK 2

Class:

SS 3

Topic:

INTRODUCTION TO MARKETING

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Previous lesson: 

The pupils have previous knowledge of

 MID TERM TEST FIRST TERM COMMERCE SS 3

that was taught as a topic in the previous lesson

Behavioural objectives:

At the end of the lesson, the learners will be able to

• say the meaning of marketing
• give examples of various Marketing concept and marketing mix—( product price place , promotion
• explain the importance and functions of marketing in the economy

Instructional Materials:

• Wall charts
• Pictures
• Related Online Video
• Flash Cards

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Methods of Teaching:

• Class Discussion
• Group Discussion
• Asking Questions
• Explanation
• Role Modelling
• Role Delegation

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Reference Materials:

• Scheme of Work
• Online Information
• Textbooks
• Workbooks

Content:

TOPIC:- INTRODUCTION TO MARKETING

CONTENT:

• Meaning of marketing
• Importance and functions of marketing in the economy
• Marketing concept and marketing mix—( product price place , promotion)

SUB-TOPIC 1:   

Meaning of marketing:

Marketing is the business activities that direct the flow of goods from the producers to the final consumer in order to satisfy consumers and leads to accomplishment of the company’s business.

Marketing creates time, place, possession and form utility. It arranges for production and making goods available at the right time, in the right place and form,

MARKET:

A market is any arrangement personal or impersonal, former or informer which facilitates with the exchange of goods and services whereby buyers and sellers are contact with one another and agree on price.

TYPES OF MARKET.

1. Consumer market: This is the market where goods and services are sold to the final consumers. Examples of market are Balogun market, Onitsha main market. Consumer market is a market for final end users of the product who buy goods not for the purpose of making profit.
2. Industrial market: This is a market that is not for the final consumption but for the production of goods and services to be sold to the consumers market e.g. a market where industrial machines and automobile spare parts are sold.
3. Producer market: It consists of individual or business that purchase product for the purpose of making profit by using them to produce other product.
   

MARKET SEGMENTATION:

This is the process of dividing a total market into market groups consisting of people who have relatively similar product need. In other word, market segmentation is the division of a market into identifiable sub markets for the purpose of reaching target customers with most appropriate set of product mix, quality, price, advertisement etc.

Usually, there are two segmentation of market strategies employed by market professionals.

These are:

1. Concentration segmentation: This is when an organization directs its marketing efforts towards a single market through one marketing mix
2. Multi-segment strategy: This is when the organization directs its efforts at two or more segments by developing a mix for each selected segment.

FACTORS THAT INFLUENCE MARKET SEGMENTATION

1. Demographic factor: This is a situation where a market is sub-divided based on demographic variable such as age, sex, family size, income, religion and occupation.
2. Geographical factor: some market may be wide and large to operate to operate as a single market therefore there is need to divide such markets into different locations eg local areas, state, country and so on.
3. Psychographic factor: This is a situation where the consumers are divided into various segments or groups using their psychographic variable such lifestyle, personality, perception, motivation, belief and so on.
4. Behavioral factor : This is a situation where buyers are divided into various groups based on their knowledge, user, rate, attitude, response to marketing activities and purchase behaviors

Evaluation

• Define market
• Describe three types of market
• Highlight four factors that influence market segmentation

UTILITY: This refers to the level of satisfaction a consumer derives from the consumption of a particular goods. In other word, utility is creation of goods and services in other to satisfy human want. For example, if someone is thirsty, he or she will derive more satisfaction from the first cup of water taken than the subsequent one

TYPES OF UTILITY

1. Form utility: form utility is created by changing the form of raw materials into finished goods.
2. Place utility: this is reflected in the transportation of goods from the point of production to the final consumer.
3. Possession utility: this is reflected in the transfer of title and in providing information about the product so that the buyer may use or enjoy it to the best advantage.

EVALUATION:

Differentiate between market and marketing

SUB-TOPIC 2:

IMPORTANCE OF MARKETING IN AN ECONOMY

1. It bridges the gap between the producer and the consumer
2. It reduces wastage through marketing research thus, indirectly increasing production
3. It converts people’s needs into profitable company opportunities, through the movement of industrial goods to rural consumers by promotion and consumer education
4. Marketing is a creative employer because all the numerous activities performed therein are possible employment avenues
5. The exercise improves the standard of living by making goods produced in one area available in another area
6. He also ensures consumers satisfaction.
7. It informs the consumer about the existence of goods and services
8. It creates market for goods and services.
9. It assists the transfer of goods from producer to the consumers.

FUNCTIONS OF MARKETING

1. Risk bearing
2. Financing
3. Storage/warehousing
4. Buying/selling/exchange
5. Grading and standardizing
6. Marketing information research
7. Transportation
8. pricing

DIFFERENCES BETWEEN MARKETING AND SELLING

EVALUATION:

1. State 5 importance of marketing to the economy
2. Explain 5 functions of marketing.

SUB-TOPIC 3:

MARKETING CONCEPT AND MARKETING MIX

Marketing concept is the idea or belief that consumers/customers should be treated as king.

The interest and desires of consumers must be taken into consideration by bringing out products or any business activities. The basic idea behind the marketing concept is consumer orientation. That is, the consumer must have in mind while planning. It is assumed that consumers are always right i.e. “consumer sovereignty”.

Marketing concept involves these fundamental propositions.

1. Consumer Needs: ask the consumer about his needs.
2. Product development: Development of products to suit the need of the consumers.
3. Planning and organization : Planning and organizing marketing programmed to bring the product to the consumers
4. Post sales activities: Carry out post sales activities that will ensure the products are satisfactory to the consumers

MARKETING MIX

This is a collection of controllable factors that can be used to influence the behavior of consumers. It is a combination of controllable variables such as product, price, distribution, place and promotion which spells out the marketers’ strategy to satisfy the needs of the consumers and to increase the sales of the goods.

ELEMENTS OF MARKETING MIX

1. Product: This is the goods and services offered for sale. It deals with the product features, packaging, labeling and quality of the product.
2. Price : this is the value placed on a product. It consists of the price level, discounts and payment terms
3. Promotion: This is concerned with informing customers of product features and persuading them to buy the product. It consists of advertising, sales promotion, personal selling and public relations.
4. Place: this is concerned with putting the right quantity of product in the right location at the appropriate time. It consists of the market average, channels of distribution, inventory planning, physical distribution and transport.

product    Promotion

price    place

MARKETING MIX

PRODUCT MIX: A product mix may be defined as a bundle of physical and psychological satisfaction that a buyer receives from a purchase e.g sugar. It can be an idea, goods or service.

Products fall into two categories

1. Consumer product: Products purchased to satisfy individual or family needs e.g. shoes
2. Industrial product: products bought for the use of production of other products by the firm.

PRICE MIX: This is the placing of price on a particular product that will suit the customers and fetch higher revenue to the manufacturer. The components of price mix are discounts, margins, freights, payments, credit terms, allowances, make-up, setting base price

BASIC PRICING POLICIES

1. Market penetration: the price of the product is low in order to penetrate the market. This is good for new product
2. Market skimming: High prices are set in other to make high profit and to appeal to the more affluent segment of the market
3. Target return pricing : This is aimed at securing in a given period of time a predetermined rate of returns on investment
4. Product line pricing: Some products are made less leaders i.e. loss leaders products are basically non-profitable but they stimulate buying of other profitable lines.
5. Variable pricing : e.g. soft drinks, fruits and cold water may be high price during the dry season and low in the rainy season
6. Bid pricing: This policy is used when contracts are awarded as a result of tender.
7. Pricing with the market leader: A new company entering into market will have to follow the price levels set by old companies in the industry.
8. Pricing above the market: Under this policy, a firm will charge prices that are higher than those of the competing firms.

PLACE MIX: This is concerned with the distribution of goods of goods and services to the consumers at the required place.

PROMOTION MIX: promotion deals with the communication aspect. It deals with creation of awareness of the goods and services to prospective customers.

FORMS OF PROMOTION

1. Personal selling
2. Sales promotion
3. Publicity
4. Public relations
5. Product differentiation and branding /packaging
6. Advertising.

PERSONAL SELLING:

This is the face to face meeting of the salesman with the potential buyers in their houses, offices, or market place. E.g. door-to-door selling

IMPORTANCE OF PERSONAL SELLING

1. It is a form of sales promotion
2. Creation of personal contact
3. Best for sale of technical goods
4. Introduction of new product
5. Provide opportunity for enlightenment
6. Product modification
7. Help in product revival
8. Suitable for sales of certain products
9. Poor performance by middlemen

ARGUMENT AGAINST THE USE OF DIRECT SELLING

1. Lack of financial resources
2. Geographically scattered market
3. Inadequate skilled salesmen

SALES PROMOTION:

Sales promotion can be defined as any activity that is used to stimulate sales of a product. It is a special promotion techniques designed to encourage brand patronage

REASONS FOR SALES PROMOTION

1. To encourage slow selling lines
2. To create dealers interest and encourage stocking
3. To encourage more frequent use of product
4. To stimulate off peak period sales
5. To introduce a new product
6. To boost sales in a particular geographical area
7. To offset price competition

FORMS OF SALES PROMOTION

1. Consumer promotions.
2. Free sample distribution
3. Special price sales
4. Premium offer
5. Competitions 
6. Trade fairs

TRADE PROMOTION

Examples:

1. free gift
2. special discount
3. cooperative advert
4. sales competition for sales staff

PUBLICITY

This may be defined as news about a product or companies, appearing in form of editorial material without cost to the spout or in the press on radio or television

USES OF PUBLICITY

1. It accords credibility to a company
2. It dramatizes a company and its products or services
3. It secures a favorable public image for the firm
4. It create awareness for a company and its products or service

FORMS OF PUBLICITY

1. Photograph
2. Feature stories
3. News conference
4. Work visit
5. Press release or news items

PUBLIC RELATIONS

This is a deliberate but sustained effort by a firm to establish a good image for the organization in the eye of its numerous public and by so doing, create goodwill and favorable trading environment for the company and its products or services

PRODUCT DIFFERENTIATION AND BRANDING

Product differentiation can be defined as all means by which a producer attempts to distinguish his product from similar products made by rival producers.

BRANDING: This is the act of giving a distinctive label or name to a product e.g. coke, fanta, Pepsi etc.

REASONS FOR BRANDING

1. It encourages standardize pricing
2. It facilitates self – selection
3. It ensures easy recognition of product
4. Branding is useful in introducing new product
5. Brand loyalty may give a producer a greater control over the market
6. It prevents the adulteration of the branded product.
7. It leads to a more readily acceptance of a product by middlemen
8. It allows a producer to enjoy a sense of monopoly
9. To differentiate product
10. It informs the consumers about the existence of a new product

ARGUMENT AGAINST BRANDING

1. The cost of branding may be prohibitive
2. It is disadvantageous to the retailer in that he will have to stock many varieties of the same product in order to please all his customers
3. Too many brands may confuse customers
4. He creates false buying on the part of the customers

PACKAGING

This involves the development of a container and a graphic design for a product. It is a way of presenting a firm’s product in a safe and secured form to the consumers.

REASONS WHY MANUFACTURER PRE-PACKAGE THEIR GOODS

1. The middlemen are relieves of the burden of having to pre-package the goods.
2. False measuring and weighing by unscrupulous retailers are minimized.
3. Branding and labeling are possible with the packaging of goods.
4. It protects the goods as they move from the producers to their final users.
5. It makes advertising easy.
6. There is possibility of recycling.
7. It makes for easy handling.
8. It protects both buyers and sellers from any harm from corrosive products.

DISADVANTAGES OF PRE-PACKAGING.

1. It makes products to be more expensive and the cost is borne by the consumers.
2. Information on pre-packaged goods may be deceitful to buyers.
3. Buyers are compelled to rely on the information stated on the package.
4. Actual inspection of goods is not possible unless the package is to be destroyed.
5. End users often litter the environment with wrapper and empty cans.

EVALUATION

1. What is branding? State five ways branding affects the consumers.
2. Why do manufacturers engage in personal selling?
3. what is marketing concept
4. Explain four elements of marketing mix.

GENERAL EVALUATION.

1. Which of the following is not a component of marketing mix? (a) Product (b) people (c) place (d) price.
2. All these except one are not the criteria for determining policy in a business organization except? (a) skimming pricing (b) market penetrating pricing (c) mark –up pricing (d) market force pricing
3. The following are forms of promotion except (a) sales promotion (b) advertising (c)marketing mix (d) publicity.
4. One of these is not a function of a marketing (a) research (b) import (c) retailing (d) production.

ESSAY TEST.

1. Why do manufacturers engage in personal selling?
2. What is marketing concept? (b) Explain the four elements of the marketing mix
3. Explain five functions marketing.
4. Describe five reasons why a manufacturer may brand his product.
5. Define marketing mix. Briefly describe each component of the marketing mix.

WEEKEND ASSIGNMENT

Read Essential commerce for senior secondary schools by A.O Longe pages 318 – 328

PRE-READING ASSIGNMENT: Read about business documents and means of payment.

REFERENCE BOOK: Essential commerce for senior secondary schools by A.O Longe