Running Head: Marketing Mix
February 21, 2009
The marketing mix is probably the most famous marketing term. Its elements are the basic, tactical components of a marketing plan. The marketing mix is a tool that an organization uses to ensure reaction from its target market in accordance to the marketing objectives the organization is trying to fulfill. The marketing mix has four specific strategy decision areas that an organization evaluates prior to offering a product to its consumers. The four fundamentals are “product, price, place, and promotion” refers to the items that are tangible such as the packaging, a brand name, or a warranty.
Organizations use the marketing mix to evaluate whether the product needs improvement or not and how this product can be changed either with packaging or additional warranties to increase sales or gain a competitive advantage over its competitors.
Price can affect sales of a product hugely. It is an essential part of the marketing mix. There are several factors that can affect the price of a product.
▪ Production Costs. A firm will want to set their price higher than their production costs in order to make a profit on each product sold.
▪ Competition. The company will have to monitor their competitions prices, as setting them too high or low could cause them to loose sales and market share.
▪ Corporate objectives. The objectives of the company play a part in the price of a product. If their objective is to make profit, a higher price may be set. If their objective involves gaining market share, lower prices may be set.
▪ Demand level. If a product is in a niche market where there is little demand for it, a high price may cause very few or even no sales at all. A good balance must be found.
▪ Stage in the product life cycle. The company must consider what stage in the product life cycle their product falls in. If the...