How to Write a Competitor Analysis Report

How to Write a Competitor Analysis Report

Always market is being more competitive, and sustainable businesses are becoming unstable. The expanding number of competitors are destroying the market. To avoid failure and to make the business stable, competitor analysis is one of the most critical reports.

In this report, the list of competitors and individual analysis should be discussed. To make a competitor analysis report, the following criteria should be maintained.

Criteria/Sections

  • Introduction
  • Competitors List
  • Products and Sources (Primary & Secondary)
  • Pricing Policy
  • Product Quality
  • Market Share
  • Focus Money Making Model
  • Execution Strategy
  • Marketing Strategyompetitors SWOT Analysis
  • Competitors Strategy and Execution Summary (Successful/flop)
  • Conclusion

What Should be Described?

  • Introduction – Under this section, a brief about the purpose of this report and results should be discussed.
  • Competitors List – Under this section, a list of potential competitors should be discussed.
  • Products and Sources – Under this section, the source of our competitor’s products and type of products should be discussed.
  • Pricing Policy – Under this section, the pricing policy of the competitor should be discussed.
  • Product Quality – Under this section, the competitor’s product quality and related other criteria should be discussed.
  • Market Share – Under this section, the competitor’s market share data should be discussed.
  • Focus Money Making Model – Under this section,
How to write a market analysis report

How to Write A Market Analysis Report

The “market analysis report” is one of the essential reports/documents based on which the admin panel of a company decides the next move. There are certain criteria to arrange information.

Topics/Points

  • Introduction
  • Competitors
  • Popular Products in the Market
  • Seasonal Dominance on the Market
  • Customer Preferences
  • Pricing Policies in the Market
  • How to Penetrate the Market (Strategy & Execution)
  • Product SWOT Analysis
  • Conclusion

A market analysis report provides the necessary information under the criteria noted above.

What Should Be Discussed in the Points?

  • Introduction – Under this section, the purpose of making the report, and the summary of the report will be discussed.
  • Competitors – Under this section, regular competitors should be listed.
  • Popular Products in the Market – Under this section, recent popular products should be enlisted. Besides, the name of brands who own those products should be mentioned.
  • Seasonal Dominance in the Market – Under this section, current seasonal products, and the upcoming seasonal product types should be listed.
  • Customer Preferences – Under this section, the likes/dislikes/priorities of the customers should be enlisted. This section is an analytical section.
  • Pricing Policies in the Market – Under this section, regular pricing policies that are active in the market should be discussed.
  • How to Penetrate the Market – Under this section, strategies and execution procedures to lead in the market should be discussed.
  • Product SWOT Analysis – Under this section, a SWOT analysis of the running products should be discussed.
  • Conclusion – Under this section, an overview of this report, including results, should be discussed.
distribution network

Establishment of Distribution Network

Distribution Network is very important to sell your product. However, sometimes Retailer, Wholesaler, Distributor, and Consumer do not take or sell your product.

The reasons are given below-

  • Product Quality– If you have a low-quality product
  • Product ROI– If they do not get any ROI from your product
  • New product – sometimes they do not take your product because you are a newcomer
  • Low Margin
  • Low brand buildings
  • Tough competitors

 

The Benefit of the Distribution Market

 

Distribution market helps you to build up a strong network without any expense so that you can build your sales in the market.

  • Low Sales Marketing and Distribution Cost– If you build up the salesman and shop throughout the country then the cost is increased. If you have distributer than the cost decreases and the sale growth rate increases.

 

  • Market Penetration – Market penetration gives a way in which entry is difficult for Mainly it acts as a green card.

 

 

  • Trust Worthy Partners – Peoples are like to purchase a product from trustworthy Because they have a reputation in the market and people feel safe to buy from them. As a result, the sale rate increases.

 

  • Rapid testing – By this way, you know what is happening in the market. From this way you can change the product when it is needed.

 

 

  • Efficiency – Efficiency is when the speed of the project increases. The time required in the expense would have been greater. The time required here is far less thus, increasing the efficiency of a project.

 

The Disadvantage of the Distribution Market

 

  • Risk of Distributor Brand – It is risky if the distributor brand is of low quality. People do not feel safe to buy any product as they have no reputation in the market.

 

  • Delay in payment– Sometimes the distributor take the product, but in return, they do not give any payment. So it is very important to know the personality of distributer before the hiring.

 

 

  • Lesser control– To know about the wholesale process is very difficult. If the distributor, wholesaler, and retailer are not trained well or they do not present the product perfectly then the sale is down.

 

  • Reduce Feedback Cycle – Sometimes actual feedback does not get from the market, so the sale rate decreases.

 

 

  • The Cost Rate is Increased– You have to be concerned about the cost of the distributor, wholesaler, retailer and also the customer purchasing rate. As a result, the cost rate increases.

 

How to find a new distributor

 

  1. Sales Representative– They are the person who sells the product to the market.

 

  1. Channels sales Executive– They are the person who builds up the channels partner. It is very important to build up executives in every city in the country. They help to build the distributor which increases the sales rate. So a highly trained and educated executive is very necessary.

 

 

  1. Join the Industry Association– Every industry has the association. You have to participate in the association because here you can meet with many experts who can be of help in the future.

 

  1. Trade shows– You should attend the trade shows.

 

By attending this program, you can meet:

  1. Vendors
  2. Partners
  3. Manufacturers
  4. Suppliers
  5. Wholesalers
  6. Retailers
  7. Consumers
  8. Buyers
  9. Exporters
  10. Importers

Here you can find out many support person, some big orders and also get the contract manufacturing.

 

  1. Meet the Existing Distributors– It can help you to get references. It may be one distributor is in-network touch with another distributor in another region. His reference helps to generate a new distributor. Thus, a ready market is earned in that particular region.

 

  1. Wholesaler and Distributor Websites– There are many websites of wholesaler and distributor. Here you can find out a big list of wholesaler and distributors. Through this way, you can find out.

 

 

  1. Subject Matter Expert– If you are a newcomer then firstly focus on yourself and make yourself an expert, and later you can hire the executive and representative.

 

Example – If you make the shampoo then first you have to know the market wholesaler and retailer and the supplier. You have to find out (15- 20) well-trained distributor. Then you have to find out who has the highest market penetration and sales rate. You also have to find out who has the highest level strength and also have the capability to take the new brand.

 

  1. Keep an eye on your competitor– You have to know about your product competitors and what they are doing. So, you are always up to date and get some new idea.

 

  1. Use your websites and social media to generate more leads– You have to make a page on websites and make a sheet about the benefits of distributer. Then you can put it on the websites. So distributer easily find out and count down in return they beneficial or not. You can promote it by social media like- SMS, what’s up, LinkedIn, Facebook, Tweeter, and YouTube.

 

  1. Meet alliance experts– They help you to buildup partners and distributors In returns, they take a commission.

 

 

  1. Outdoor advertising – You can also advertise the product by the outdoor.

It is two types—

 

  • ATL- Above the line
  • BTL- Below the line

By this two way, you can find out the distributors.

Pull Strategy

Case study

Karsanbhai Patel is the owner of the “Nirma.” At the very beginning, he did not get any payment from the distributors in returns of the product. One day he decided to bring all of “Nirma” from the market and told that he did not sell any detergent.

He decided to stop the supply of detergent as he did not get any payment. Some days later, he builds a very good advertisement on TV. This advertisement became very popular all over the country as a result customer demand increased.

People were all over the shops looking for washing powder “Nirma”. Retailers ask distributors to provide “Nirma”, which brings distributors to the “Nirma” Factory. Kharsanbhai Patel asks the distributors for his money. This strategy is known as the pull strategy.

market research

Market Research: Definition, Examples, Process

Market Research Definition

Market research process refers to collecting data about the market itself, the competitors, the offered products or services is collected in a systematic way to get a better undesiring of the demands of the targeted audience. This is one of the most important business strategies.

Market research Analyst

A person who helps a company grow and gain leverage over its competitors by doing research on its competitors, analyzing customers’ reaction to its offered products and services, etc.

market research analyst

Market Research Examples

Market research examples include:

Market Segmentation:

This market research process is basically segmenting the targeted audience into different groups based on their…..

  • Demographic characteristics: age, gender, income, religion etc.
  • Geographic Difference: region or location.
  • Psychographic difference: lifestyle, preferences, values etc.
  • Behavioral Characteristics: Usual behavior, purchasing habit, etc.

Movement of Market:

Analyzing the movement of markets at a direction for a certain period of time. This happens to change over the evolving or changing of lifestyle, income or even technology!

  • For instance, the more time has gone by, the more technology smart we have become. We tend to use smartphones for almost everything nowadays. We have evolved into a modern era. And as a result, the market demand and supply of smartphones have gone higher than ever before.
  • The 90s kids did not grow up with smartphones in their daily lives. But now, they are the generation which uses smartphones the most!

The condition of the Market:

Market research analysts research and analyze the current and estimated future conditions of markets as well. This process includes analyzing the current or upcoming commodities or services available in the market, their process, how they are doing business etc.

SWOT Analysis:

Market research analysts work with all these four elements.

swot analysis

 

Market Research Types

While there are so many market research tools available for you to use, usually two types of data are used to conduct market research & to lock on the target audience.

Primary Market Research:

This type of market research data includes…

  • Original information you gain from the first-hand experience or with the help of a firm
  • Usually, you collect this type of market research data yourself

Pros of Using Primary Market Research:

  • You can collect the data personally
  • Hence, you are in full charge of the ways of getting access to the information as well as using it
  • You can interpret the data the way you prefer

Cons of Using Primary Market Research:

  • It can be time-consuming
  • Data is usually of the high cost
  • More resources are needed to do bigger research

Types of Primary Market Research:

Exploratory Research:

This type of primary market research concentrates on the problems which are not clearly defined yet. This focuses on investigating the existing problems more carefully to get a better idea of them.

 

  • For example, suppose you have a production line in clothing and you think including t-shirts in your product line will increase the sales. As you don’t know for sure, you conduct exploratory research to find out questions of why and how introducing t-shirts will bring more you revenues. That is exploratory research.

Specific Research:

This type of primary market research usually follows after exploratory research.

  • This operates by asking the targeted audience very specific questions or polls when collecting primary information.

market research firms

Methods of Primary Market Research:

  • Market Research Survey:

This process includes making up very specific questions to target audience or respondents.

  • It’s a quantitative method where respondents are asked questions to figure out topics such as current trends in fashion, proffered genres of books by readers, etc.
  • Interviews:

This process includes a series of questions which are asked to the targeted audience in order to gather information about one topic or more.

  • Interviewees are asked the various type of questions which give the interviewers about the interviewee’s experience, recommendations or opinions about something.
  • Interviews are usually conducted face to face or by using the telephone as well.

 

  • Focus Groups:

This is a process where people of the same background are chosen to participate in an experiment or research process where they freely share their insights.

  • This process is usually used while doing exploratory research.

 

  • Observational Research:

In this process, a chosen person’s behavior is observed when exposed to different situations.

  • For example, observing how a customer reacts to the different color/shape of the product he/she usually buys.

Secondary Market Research:

This is the type of market research data which has already been collected by other factors and you’re just going to use them as your source. For example, you can collect these data from….

  • Government agency studies
  • Surveys were done by NGOs or other organizations
  • Reports are done by your competitors

 Pros of Using Secondary Market Research:

  • Easily accessible
  • Data is usually available on low cost or free of cost
  • Time effective method

Cons of Using Secondary Market Research:

  • Too much irreverent information
  • Spotting relevant and important information from this market research data can be quite challenging
  • Data can be inaccurate or outdated

Types of Secondary Market Research:

Online Research:

  • Nowadays it’s the most common secondary market research method because of its convenience.
  • When a market research analyst uses online sources such as Google, Bing, ask, etc. to gather and analyze information, it’s called online research.

Literature Research:

  • This type of secondary market research refers to a process where different sources of literature such as books, newspapers, journals, etc. are used to gather information.
  • Using online books, magazines, journals, etc. are included in this type as well.
  • This method is mostly used while proving a hypothesis.

Case Study Research:

This secondary market research process enables the market research analyst to gather information and analyze the situation by reviewing existing case studies of similar situations.

This method is often used by business organizations and health care sectors.

market research companies

Market Research Steps

Now that you know all about the different market research types, you should know about the steps to follow while doing your market research. This step by step guide will make it so much easier to get the job done.

 

 

 

 

Define your targeted audience:

In order to start your research, you need to know all about the customers first. Why? Because if you know all about the market audience, you can easily out them in different segments based on their age, gender, social status, region, etc. Putting them in different segments will only help you while planning your strategies to attract them to your product. If you can define them, you can spot who among them are your real customers/ can become your targeted audience! This first step works as a guide to the following ones.

Select a portion of your target audience to work with:

Now that you have spotted who your actual customers are, you need to gather some information from them which will be pretty useful for you. You can select a portion of them (either big or small) to help you in conducting your research.

  • This step aims to gather information from the sample such as buying habits, preferences, spending limits, etc.

Select contributors for your market research:

While selecting participants you should remember a few things that would be helpful.

market research analyst jobs

  • Variety:

Go for variety when selecting a sample for doing your research. You can select your own customers who buy from you, people who buy from your competitors, people who haven’t bought anything till now or have decided not to.

This way, you can gather a variety of information about how people with different experience or perspective think or decide differently. You can analyze what motivates them to buy from you or to buy from your competitors. On top of that, you get a fresh insight into the point of view from the ones who have decided not to buy at all.

  • Your Customers:

Selecting people who have done business with you recently would be a smart choice. Why? Because they can provide you with their experience, stories, recommendations or even criticism; while all these would be the latest!

Chances are, your customers will give you a more honest opinion than the others. People who have interacted with you recently already know your condition in the market better than any other customers.

  • Social Media Followers:

There are people in social media who follow a lot of pages and do not buy from all of them. Find out who these people are in your case and talk to them. Chances are, they are potential customers would be willing to buy from you if some differences were there. You can figure out what makes them follow you but not buy from you. This way, you get to know what is stopping them from becoming your customers.

  • Use the network to your advantage:

Spread words about you conducting market research via your colleagues, subordinates and via official job profiles such as LinkedIn. The more you spared it, the higher the chances of getting more participants to get.

  • Give an Incentive:

Lure your participants with rewards for helping in the market research process. This will work as an incentive to all of them.

Who doesn’t love reward after doing something, no matter how big or small?

  • For instance, you can give rewards like points for every time they participate if you don’t have a generous budget!

Research Questions:

Now that you have successfully gained a group of participants to work with, you need to specify and prepare the questions to ask them. It’s smarter to use open-ended questions while preparing research questions as otherwise, yes no questions do not give you a detailed overview of the customer’s opinions.

microeconomics

 

  • Background Information:

Start with asking background information such as customers’ personal jobs, how long they have been doing business with your company etc.

  • Awareness:

Ask them about their reaction or purchasing decision when they faced a problem (realized their need for a product/ service). Ask what options they knew about when they thought of buying that product.

  • Consideration:

In this step ask the buyers when they first faced that problem how they tried to solve it. Ask them a question such as…

Did they try to solve it via talking to others?

Did they google their solution out of it?

Did they get to know about the solution from social media or vendor website?

And so on.

  • Decision:

Ask them questions like these.

How did they finally make the purchasing decision?

What factors influenced them to do so?

  • Closing:

Ask for their recommendations to make the purchasing process better. Ask them if they have any questions.

Know your Competitors:

Before entering and while operating in a market, you should always know your competitors. You should know about how they operate, how they are doing currently and so on. The more you know about them, the more chances you get to be ahead of them.

Use search engines, visit their websites, and talk to their customers to gather information about them.

The proverb “knowledge is power” didn’t come out of nowhere, right?!

start-up and information economics

  • Industry competitors:

Know who in the industry is your competitors and see how they are doing in business. There can be many other companies who are working in the same industry as you such as the food industry.

  • For instance, if you work for a juice company then soft drinks company is your competitor. If people suddenly start preferring cokes to juice, then your revenues will go down, no?

Companies who offer the same product/ service as you do are your competitors as well.

  • For example, if you offer food delivery services, then food-panda is your competitor, not to mention, a strong one!

Summarize:

After you’re done gathering all this information, all you need to do is summarize them and analyze. Market research analyst goes through all this information, analyze and compare them; finally makes decisions.

Doing your market research can be one hell of an experience! You may think you know your audience, then you do the market research.

And Bam! You realize how much you had overlooked before. While the market research process can be time-consuming, it’s definitely an eye-opener. It can take you places, help you grow A LOT!

international marketing

International Marketing: How to Expand Business

International marketing communication Definition

International marketing communication refers to all the communication tools international marketers use to communicate and provide information to the customers (both existing and potential). It targets to communicate with customers from different counties or cultures who may have….

  • Similar interests for the products offered by the firm
  • Favorable purchasing habits
  • Similar or high demands for the products the firm offers

If you have a business and aim to grow beyond the borders, any foreign customer who buys the exact or similar products or services you offer is your potential customer.

Marketing communications beyond the borders can get tricky at times. So it’s important to handle this sector very carefully. There are so many factors that could mess things up!

international marketing graph

Tools for International Marketing Communication

There are so many tools for international communication! This modern era has made things so much easier that it’s not only letting you broaden your horizons internationally but it’s also offering you effective tools to do so. The concept of the global village has spared like a fire in the business world now!

  • Advertising
  • Sales Promotion
  • Personal Selling
  • Direct Marketing

Advertising

Advertising is one of the most effective and common ways to promote your brand. This process enables the brand to reach a large number of targeted audience in the shorted and quickest possible time. It can be cheap or expensive expending n your budget but it can go beyond any location and reach your targeted audience. Moreover, by advertising, you can promote your offered products or service and you can let everyone know about your brand as well.

The best part is, you can make it yourself as you like! As a company, you can make ads for your offerings or you can make one just to let everyone know/ give your existing market a reminder of your brand!

You can use Medias such as…

  • Newspaper
  • Social Media
  • Radio
  • Etc.

Pros:

  • More visual effect than otters.
  • Gives you a chance to be innovative while promoting.

Cons:

  • The language barrier in international marketing communication.
  • For instance, you have to use English only. But in some countries, people don’t even speak English!
  • TV channel preference of your targeted audience.

marketing mix importance-product-price-promotion-place

Personal Selling

This international marketing communication tool refers to a process where sales would be made through…..

  • sales representative
  • exhaling your products in fairs or exhibition
  • Sales management.

To execute this process you will need to recruit and train your sales representatives very carefully with more time and efforts as they will be representing your brand to various places. They will need to be culturally trained as well as they will be dealing with people from various culture.

Pros:

  • Low stuffing cost
  • Lower wages
  • Skilled employees can bring your brand a lot of goodwill in different countries.
  • Online interactions and transactions

Cons:

  • More time and money spent on recruiting and training.
  • Changes will be needed to be made periodically if not constantly while doing business with cross cultured people.

Sales Promotion:

You can conduct this process by offering coupons, vouchers, discounts, etc. to your targeted audience. When you offer these incentives customers will tend to buy more from you and thus your revenue increases along with your brand name. The more it spreads, the more market exposure you get!

Sales promotion does not only target the customers it also targets the retailers, wholesalers’, etc. who may buy from you.

Pros:

  • More revenues within a short time.
  • Trade flows go on.

Cons:

  • If it’s done too many times customers do not get affected anymore. They start to take you for granted by thinking, “Another discount? That’s nothing new!”

The marketing mix-definition-example-elements-4ps-4cs

Direct Marketing

Direct marketing is conducted by sending direct emails, using social media or other internet sources to promote and induce sales, etc.

Pros:

  1. Be more Specific:

You can directly make offers to specific and your preferred customers rather than targeting a lot of people at the same time.

  1. More Personalization:

You can make your customers feel more connected to you via communicating or approaching with them directly.

  1. Cost and Time Effective:

Pros:

  • Writing emails, rooting via social media is very cheap and does not require much time as well!

Cons:

  1. Intrusive:

Many people may find emails related to sales or marketing anyone and they may mark you as spam.

Or even in social media, people tend to get irritated if an ad pops up in their newsfeed while scrolling.

  1. Low Response:

While direct marketing is cheap, it may not affect your targeted audience as much. As a result, people may not even see your ads or give you much importance. In that case, there will a low rate of response from people.

International Marketing Communication Issues

While doing business internationally is a big step forward for your business, there are so many things that could go wrong and harm your reputation. So you need to keep certain things in mind when doing international market communication.

  1. Website:

While doing business internationally, most of your brand people usually see is your website. So make sure it’s updated, user-friendly and informative to the end users.

Make it simple yet attractive with necessaries so that people can use to easily but also bookmark it!

  1. Social Media Profile:

Nowadays people spend time on social media more than they sound time with themselves. Be smart enough to use this to your advantage!

For instance….

  • Use Facebook, Instagram, etc. to create an official page and promote your offerings as well as your brand with it. Interact with people who ask questions about your brand.
  • Use LinkedIn to promote your brand among the professionals as well.
  1. Brochure:

Your company’s brochure represents your brand! Especially when you’re dealing with customers who do not know about your company. So make sure it’s designed accurately and attractively!

4. Catalog of your Product:

Your product catalogs should have very attractive visual representations of your product. Furthermore, make sure you provide the same quality products as the ones shown in the product catalog.

  1. Public Relations:

There are different agencies in every county who deal with the public relations of firms and customers. They arrange exhibitions, trade fair, seminars, etc. to keep people know about the firm.

Give your assigned agency very clear-cut ideas about your company and your offerings.

international marketing culture

International Marketing Communication: Cultural Issues

There will always be cultural issues while you are doing business internationally. One of the most common is language. It will always be a barrier unless both your representative and the customers have the same command over English. So before getting involved with a foreign client, make sure you know how much control the client has over English.

In addition, while doing business in another country, do your research and get to know about their culture as much as possible beforehand. The more you know, the more you can use that information to connect with them. Get to know about things like dress, food, norms, and values they hold before getting involved with them.

10 Models to Expand Your Business

  1. Sales outsourcing:

  • Hire 3rd party experts for the growth in sales.
  • The expertise you lack, but the 3rd party who is an expert can sell your product within your brand.

This only works when you don’t have the expertise. If one has:

  1. Sales expertise
  2. Readymade manpower
  • Readymade Model

  1. Set process
  2. Fast Expansion
  3. Maximum Penetration

And you have:

  1. Manufacturing
  2. Design
  • Brand

  1. R & D

Then this model works in the expansion of the business. Ex. Bank outsources force to sell their credit cards to their customers.

  1. White Label Selling

If you are a good manufacturer but a small startup company your brand is not big then you can sell your product with the white label where a big brand will use their own brand label.

Ex.  Bigbazaar sells products under their own brand name but they are manufactured by other manufacturers.

  1. Retail chain

This has become very popular. Suppose Monte Carlo sell products under multi-branded stores and also has its own store. You can be franchise owned, company-owned and make a retail chain to come in touch with customers directly.

  1. E-Commerce

E-commerce is the fastest growing platform in the world. Through physical stores, you can sell within demographic geography. But, through e-commerce, the whole world is your playground. You can sell your product all over the world without having the manpower in between and reduce cost as eliminates distributor, wholesaler, and retailer.

  1. Automated Retail

 Here automated retail vending machines are placed at key locations to dispense the product. There is no need for human an automated machine dispense product after the input of money. It automatically shows refrigeration status, stock status, sold out the status and is cost effective.

 

  1. Reseller and Value-added Reseller

 Reseller often takes your product and sell it to e-commerce, as you don’t have a market. Often a reseller adds more specifications to the product and sells it at a higher price this is known as value added reseller.

  1. Wholesaler and Distributor

 By the help of wholesaler and distributor market penetration increases without cost.  Distributor enables the following:

how to expand business

 

  1. OEM Manufacturing

 Original equipment manufacturing- who manufacture for a piece of equipment or device for a big brand, who then integrates it in their own brand. OEM enables you to have

  1. Safe business
  2. Recurring Revenue
  • Secure

  1. Repeat Order

 

  1. Exports

 Bigger brands are now focusing on exports. In export, business-government serves as a helping hand.

  1. Multi-Level Marketing

 It is a chain of network representatives called with a different name. You can showcase your product to MLM companies. If the product is good they will take the product and sell it under their own brand name. This model requires no

  1. Distributor
  2. Wholesaler
  • Retailer

  1. Advertising
  2. Brand
  3. Brand Executive

At the End

To conclude, international business communication can be quite challenging! But the benefits of it surely overweigh all the trouble you go through while doing so! The experience itself helps you grow.

The marketing mix-definition-example-elements-4ps-4cs

The Marketing Mix

Marketing Mix Definition

The marketing mix has consisted of various tools of marketing a firm uses to run to run its business. It’s a combination of some elements that are vital in the business world.

  • Also known as marketing mix 4ps.
  • An extended version of it includes Marketing Mix 7 Ps:
  • 4Ps of it has another modified version which is the 4cs of marketing’ although this version is not so widely known as the other two.

Moving on to the marketing mix 4ps.

Marketing mix 4ps

Marketing Mix 4 ps

Fig- Marketing mix elements

Marketing mix product

The product is one of the marketing mix elements which keeps the system going. It’s produced by a manufacturing company or bought from a manufacturer to satisfy the needs of the targeted audience.

  • It can be tangible or intangible (in the form of service)
  • For example, if you offer clothes to our targeted audience, you’re selling a product.

If you’re offering any kind of service like delivering stuff to your customer you’re offering the service in exchange If money.

marketing mix importance-product-price-promotion-place

Marketing mix price

Price is the value or amounts your targeted audience pay you in exchange for the product or service you offer to them. Price actually places an economic value to your offerings.

In terms of selecting the price for your product or service you have to keep certain things in mind such as,

  • Not too low: If your pricing is too low compared to your competitors in the market then your customers may think your product or service is not that valuable compared to them
  • Not too high: If your pricing is too high then your customers will outweigh the too high price with the benefits received from your product.

The pricing has to be just perfect so that you can gain your profits while it’s convenient for our targeted audience as well.

Marketing mix promotion

Promotion refers to the steps a firm takes to induce its targeted customers to its products or services. Promotional activities can be divided into 5 types.

  • Personal selling.
  • Advertising
  • Direct marketing.
  • Sales promotions.
  • Public relations.

All these include several activities which all aim to familiarize the targeted audience with a firm’s offering as much as possible.

Marketing Mix Place

Place refers to selecting a place which would be convenient for your targeted customers. This marketing mix variable includes deciding which distribution channel to go with while distributing the products to the retailers and wholesalers who will sell your product to the targeted audience.

Selecting prominent places is an important cause if the locations are easily accessible to everyone, then there will be more customers looking to buy your offerings.

Marketing Mix Matrix

 

Marketing Mix 7 p’s

Although marketing mix the 4ps is initially used worldwide, this model actually has an extended version which is the Marketing Mix 7 p’s. This version includes 3 more marketing mix elements.

Marketing Mix People

This marketing mix element refers to the people involved with the whole process: your employees and the targeted customers.

Firstly you have to determine if the size of the targeted audience is big enough to demand the product or service you’re going to offer. Let’s face it if you bring a product or service in the market but no one wants it or a very small number of people do compare to how much you are offering then who’s going to buy all these extra ones?

Secondly, you have to select your employees very carefully as well. Your employees represent your company. They deliver and sell the products to the customers. Some of them are part of your promotional activities as well. If your employees are good and loyal to your company, they will do their best while operating. They will give their opinions and recommendations to the customers, influence them to buy from you.

marketing mix modeling

Marketing mix Process

This refers to the overall operations you go through while doing your business. This marketing mix element is basically the execution or implementation of the whole marketing strategies you make. This includes your payment system, distribution system etc.

While evaluating and selecting your marketing mix process, make sure you select the one which would be convenient in achieving your goals (e.g. – more production in minimized costs).

Marketing mix Physical Evidence

This one refers to the environment where services take place. This marketing mix element includes all the tangible factors that operate in the process such as machinery, furniture etc.

4cs of marketing

There is another modified version of 4Ps of marketing which is the 4cs of making mix. It views the whole marketing mix elements from another perspective.

Product Customer Value
Price Cost
Place Convenience
Promotion Communication

 

marketing mix 4cs

Customer Value

It’s best for all if firms research about the customers wants and demands before launching products or services in the market. If firms do this carefully, then they can make tentative forecasting about customer demand.

Hence, lower chances of surplus or shortage.

Cost

Price is not the only cost concerned with buying a product. The opportunity cost of choosing one company’s product over another or the switching costs or merely the convenience of choosing one firm’s products should be also included in the costs.

Convenience

Products should be easily accessible or available to the targeted audience. Marketers of the firms should select the distribution channels and place the products in suitable ones.

Communication

According to this version, promotions can be manipulative or even misleading sometimes considering they are supposed to induce customers towards the products. Open communication should be encouraged and practiced instead to make sure the targeted audience gets to know all they need to before they make a purchase. This marketing mix element refers to being more open to the targeted audience.

Marketing Mix Importance

While going through all these, it’s normal to think why a firm would need to identify all these marketing mix elements in the first place.

Truthfully told, identifying marketing mix helps a business in ways you may not have thought before!

  • It works as a guide to your business
  • It helps to evaluate options while making decisions
  • It helps to forecast strategies for future operations
  • It helps to determine the targeted audience with more precision
  • It helps a lot while starting a new product line
  • It gives you a clear idea of the whole process

 

Marketing mix helps you in growing and improving your business in so many ways. The best part is, developing the marketing mix modeling is not very time consuming and the process can is fun as well!

customer loyalty programs

Customer Loyalty Program: 7 Low Cost Tips

Customer Loyalty Definition:

While there are so many ways to define what customer loyalty is; every one of them has one thing in common that it comes from emotions. Now I could bore you with definitions from dictionaries, books or articles. But I’d rather explain in the easiest way possible.

Loyalty

If you are a startup company and are willing to expand your business then, implement loyalty at the very beginning. Loyalty has become a separate department.

What is loyalty?

It is the bond between a customer and a businessman. It is not satisfactory, as a satisfied customer will switch service if someone else provides them with a better discount offer. To be loyal customer satisfaction is not necessary, but a loyal customer will never switch. Loyalty is an emotion built strategically so that the customer won’t leave a service no matter how cheap or discounted other services are such as, Apple customer stick with iPhone despite their prestige pricing.

Loyal customer acts as an unpaid employee by spreading the word to other people which helps in terms of promotion and acquiring a new customer. It has been established that acquiring new customer cost 7 times more than retaining an existing customer. Customer loyalty increases:

  1. Brand Equity
  2. Repeat Purchase

Friend reference works more than fancy endorsement it helps to increase

  1. Brand Awareness
  2. Customer Engagement
  • Prospect Generation

The loyal customer plays an important role in feedback and forecast as better feedback makes the forecast more accurate. The forecast is important for

  1. Planning
  2. Product
  • Expenses

  1. Reach
  2. Marketing
  3. Budgeting
  • Accuracy

Customer Engagement is very important for customer loyalty the below example provides a clear picture:

Starbucks started a campaign taking customer input such as:

  1. Suggestion
  2. Discussion
  • Feedback

They did so by creating a website mystarbucks.com making people feel like Starbucks will do as you say. People responded to this campaign after which they were asked for further engagement through:

  1. Like
  2. Share
  • Comment

  1. Input
  2. Validation

The most liked idea will be was implemented. Through this campaign over the course of few years Starbucks implemented more than 300 new ideas. This increased customer engagement thus increased customer loyalty. Through Starbucks brought upon 3 fascinating changes:

  1. Product Idea
  2. Experience Idea
  • Involvement Idea

So How to Acquire Customer Loyalty?

  1. Point-based Loyalty: Give customer points upon purchase which they can redeem. A survey from Deloitte demonstrated that brands using point-based loyalty program are 88% more profitable.

This will build:

  1. Online Conversion
  2. In-shop Experience

Jet Airways Case study the divide frequent flyers into a different category from high to low. They provide different facilities such as Lounge access, Baggage Allowance, Early check-in benefit, etc categories. These privileges are easy to redeem and increase loyalty.

  1. Build loyalty through Social media: Incentivize customer through social activities.
  • Customer Referral Program: This decrease staff expense, provide loyal customer benefits and in turn, brings the customer.
  1. Analyze with data: Keep customer data always keep CRM
  2. Emotional Engagement: Analyze the data and engage with emotion based on the data
  3. Build Anticipatory Content: Understand through which you can benefit your customer.
  • Transactional Business vs Delightful Surprise: Customer likes an unexpected surprise, build and OMNI channel strategy. Such as, on the birthday of your customer, make it special through:
    1. Phone Call
    2. SMS
    3. Social Media
    4. Gift or Coupon
    5. Cake
    6. Scheme
    7. Discount

Give 80% and sell 20% is the 80-20 rule.

You know you have achieved customers’ loyalty when-

  • You see sales going up without providing any discount
  • You see the same old familiar faces pop up your shop (online or offline) even though they have many options to choose from
  • While scrolling social media, you stumble upon comments where som, one has recommended your product/ service.

You know you have loyal customers when you see some customers keep coming back to you and heck they even bring other ones with them!

Customer Loyalty Programs

Customer loyalty programs are those programs which plan and provide loyal customers with rewards. Some customer loyalty program examples include treating the customers who make a regular purchase from a company to keep the customer more satisfied. These rewards are aimed to be used as incentives for the customers so that they keep coming back to a particular brand.

For example, a company can provide loyal customers with-

  • Free samples
  • Coupons
  • Points for every purchase
  • Token of appreciations etc.

Customer Loyalty Importance

Now you may wonder how loyal customers may help you grow your business. Are they worth all these efforts? The answer would be yes. You would be surprised by how much customer loyalty benefits you.

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Higher Sales

Loyal customers would make frequent sales if not regularly. It all depends on their needs, the type of product you’re providing them with. A loyal customer will keep coming back to your shop whether or not you have provided the discount. As long as they are satisfied, they will purchase from you. Loyal customers will also tell their friends, family, acquaintances all your other potential customers about your product. So when these potential customers hear about your brand, some of them if not all will come to you.
Thus, your revenue increases!

Brand Popularity

WOM (Word of Mouth) refers to customers sharing their opinions or views of a product or brand to another one.
Like mentioned before, loyal customers will talk about their experience and your product to others. And customers usually value another fellow customers’ opinion more than anything else while evaluating a brand. And when they hear about your brand from the loyal customers, that’s when your brand will get more coverage to the market. You’re getting more popular than before, and the best part is, all those are positive evaluations!

Less Customer Acquisition Cost

It’s easier and not even expensive to maintain a regular old customer than acquiring a new one. For example, if you already have a customer who knows and admires your brand, you don’t have to introduce that customer to your brand again & again. All you need to do is, keep coming with products. You can reward loyal customers by giving coupons, points or free samples, etc. occasionally to make them more interested.

Higher Profits

Profits will rise in sales. According to research, one loyal customer tends to spend more than two new ones combined. Loyal customers already know what type of products or service they are going to get from you. They know, they are already satisfied. So they will come back & make more purchase than a new one will.

Low Advertising Cost

The more attached your customers are with you, the less adverting you would have to do for your products. Why? Cause they already know about you and they are happy with the service they are getting. So you would not need to spend as much money on advertising your product.
Think about what you need to do when you want to attract new customers.

You need to make sure your targeted segment gets a positive vibe from your brand; you would have to lure away the potential customer from many competitors. You would have to be more careful as the old loyal customers may overlook simple mistakes but the new ones won’t. You would have to be made very lucrative offers if you are trying to gain new customers who are already purchasing from another brand.

Stronger Position in the Market

When you have loyal customers who shop from you, share their positive experience with others and choose you over others, they have already got your back. They are already boosting up your revenues and profits. They are bringing you, potential customers, as well. All these make you a strong competitor in the market. When you have bigger market coverage and an army of loyal customers to protect you, you’re already standing taller than your competitors!

You will they will forgive you

Mistakes occur in businesses all the time. While dealing with any customer, you should try your best to avoid them. But even if something happens, there’s a higher possibility that a loyal customer will forgive you or overlook your mistake. At least, they will give you a second chance to correct it. Whereas, a new one may not do so.

Grow the connection

When you have loyal customers who have stuck by you through thick and thin, you have their data as well. You can use that data to make sure they stay even more connected to you.

How?

Use the important dates like their birthdays or partners’ etc. and give them surprises on these special days. These things do not cost much, but they will mean a great deal to the customers. Let your customers know they are being appreciated; make them feel important to you. Hence, the customers will feel more emotionally connected to you, and that’s another reason why they will stick by you!

customer-Loyalty

Customer Loyalty vs. Customer Satisfaction

Although it may seem like it, these two aren’t the same. One is temporary but may or may not last very long. Whereas the other one is permanent.
A company gets to know about its customer satisfaction via the reports they collect from the customers they have done business within the previous periods. A customer may be satisfied with the lasts interaction he/she has had with you, but that does not mean that he/ she is a loyal customer.

That customer may leave when a more lucrative offer from another company pops up or simply the mere convenience if buying from another brand or availability of another. Now, this customer is satisfied with the products bought from you, sure. But he/she may not stay with you. And that’s not loyalty.

Seven Low-Cost Tips for Creating Loyal Customers

Now we will discuss the most important and beneficial seven low-cost tips or strategies to create loyal customers. Courtesy of these tips has been given to DR. VIVEK BINDRA.

Customer Name is The Sweetest Desert to Him.

  • The customer likes to hear his name from another person.
  • Give a personalized, specialized, and customized service. Customers tend to like these types of service.

For example,

A survey conducted represented that:

In a restaurant during bill clearance, a waiter served the bill only; another waiter served bill with mint. The latter received a 14% extra tip. Again, a waiter served bill with mint, but the kids did not like mint, so he got chocolates for the kids. The kids were happy as a result parents were happy which got the waiter a 27% extra tip.

This extra personalized service requires low cost but increased brand equity and value significantly.

Even if a shopkeeper calls his customers with the name, it will increase customer loyalty without any cost at all.

customer loyalty
customer loyalty

Co-Creation of Innovation With Your Customer

  • Do not innovate alone.
  • Co-create innovation
  • Co-create the idea or the changes to a product with the customer.
  • Take a lot of customer feedback making them feel they created the product

This model is known as the ABCDE model.

  • Analyze
  • BrainStorm
  • Co-Create
  • Deliver
  • Evaluate

All these are to be done with customer

The success of SUBWAY lies in the fact that a customer has complete freedom to choose from a variety of ingredient. He is in complete control of creating his subway-sandwich. Even if it turns out bad the liability is on him. Thus, he won’t be disappointed.

There are two types of innovation:

  1. Manufacturer led innovation: Here the manufacturer is in complete control of the innovation. The customer has no involvement.
  2. User-led innovation: Customer and manufacturer work together to innovate a product.

The two products were made to satisfy the same need but Product a sold 19 million whereas, the second product was sold 150 million. This is because in the second product customer thinks he is in control and thus acceptability increases.

Customer’s Love Loyalty Program

Customer loves to come back if such a program is designed which gives him a reason to come back which must be easy and exciting.

There are two types of benefits:

  1. Financial Benefit
  2. Emotional Benefit

Emotional benefit is a psychological benefit.

For example,

A bank offers 3 types of cards Diamond, Ruby, and Emerald ranked from high to low. The customer is willing to pay extra, upgrade and take the highest emerald card if he feels superior that a ruby and emerald card holder.

Frugal “wow” and a Delightful Surprise

This process does not depend on price but requires such an action were customer gets delighted.

  1. Financial wow: Never spend too much money to get a wow. This decreases the frequency of wow.
  2. Frequent wow: It’s better to get more frequent wow with low expense. This increase the frequency of customer satisfaction.

For example,

A customer is in a call with a call center executive regarding a problem; it’s taking a long time to solve his problem. The executive decided to order a pizza for his customer. When he receives the pizza, he is delighted and wowed. This requires low expense but can be done frequently.

Don’t See it as Product See it as a Project

Sell a product to a customer as project management.

Project management has three pillars:

  1. Scope: Scope includes:
  2. Deliverables
  3. Specs
  • Objectives
  1. Exclusions
  2. Constraints
  3. Characteristics

These define what a customer will get in a product. It is necessary to figure out if you can under commit and over deliver. Whatever was promised if the extra amount is given customer will be highly satisfied.

  1. Time: If the project is delivered ahead of time then the customer will appreciate it.
  2. Cost: If the cost can be reduced and extra can be given then customer loyalty will increase.

Create a purposeful emotional story.

According to Neuro-Linguistic Programming (NLP), people don’t remember data, fact or figure but, they remember the story. The story has a higher retention time in the human brain. If a powerful story can be created the product will be remembered more.

For example,

EnGio personnel described a story about a boy,

Wearing torn clothes the boy picked up a rotten apple from a dustbin. Almost whole of the apple was rotten black. He cleaned the part which was not yet rotten and ate it.

He added “I was devastated by this scene, it broke my heart, and I started this Feed and Educated Hungry Child Campaign. To help these poor kids are you willing to help?”

It is almost impossible to say know to hear this story and thinking about the poor kids. This backed up story also helped to register this information in the human brain.

Sell Experience Over Money

Creative ad campaigns help create recall value. Instead of talking about the benefits and feature of a product, if the experience can be shared in the tagline, then product recall value will increase.

Establishment of 5 Formulas For Customer Loyalty

loyalty Formula

  • Repurchase Rate – Repurchase rate is very important in case of Multi-level marketing, B2bNS

                                             Number of Repurchase/Number of Unique Purchase x 100

  • Net Promoter Score – It gives an idea, How satisfied your customer with your services?

Example,

It is the review of staying in a hotel or the review of the food in the restaurant. If you give rating 6 from 10, then you are not satisfied with her services. If you give rating 4 out of 10 then, the services are very bad and if you give 9 or 10 then the services are excellent. So they are the loyal customer of yours and you give a recommendation to others to go there.

Loyalty Calculations

Loyalty can be calculated by the feedback scale. Like 100 customers come towards you. 70 people give rating (9-10) and 10 people give a rating from 7-8 and 20 people give a rating from 1-6. So the 10 peoples rating is neutral.

So,

70 (Promoter) – 20 (Detractors) = 50 (Net Promoter Score )

When a customer is the promoter of your brand, the business can build up automatically. This called Loyalty.

Up-Selling and Cross-Selling Ratio

If the customer comes to buy one thing but you convince him to buy more than the turnover rate is double.

Example-

Suppose, you sell Commodities, Currency, Mutual Fund, PMS, Types of Insurance, Fixed Income Plan. The customer comes to buy Insurance, but you convince him to buy PMS and Mutual Fund then the sales turnover rate is increased.

Number of Customer Buying more than one Product – 1000

Number of Customers who bought single Product – 5000

So,

  1000/5000 X 100  = 20

So Up- Selling and Cross Selling loyalty Ratio is 20%

Frequency and Recency

Frequency means the number of times customer comes to purchase.

Recency means how recently a customer has made a purchase.

Example,

Mahindra shop is closed for a one month so customer comes to purchase from you. But when the Mahindra shop is open than the customer stop to purchase from you. So Recency is very important to build up the sales rate.

Redemption Rate

Provide customers with Coupon, Loyalty bonus and point coupon. Provide coupons for the future sale, this generates more loyal customers.

Redemption rate= Loyalty Point Redeemed/Loyalty Point Issued X 100

At the End

Customer loyalty is gained when you see a familiar customer is doing business with you again and again. Even when you are not offering discounts or lucrative packages, that customer purchases from you, these customers stay with you for the long term and let others know about your product. These customers do not just bring you revenues; they help you grow as a brand.

Finally, customer loyalty is something every business strives for, and all the efforts given to gain this are worth it. If you have a business and aim to grow, your loyal customers are your best friends!