Marketing assignment essay: manufacturing company products & services
- Introduction of Marketing………………………………………………………….3
- Role of Pricing in Marketing……………………………………………………….3
- Importance of Pricing………………………………………………………………4
- Characteristics of Services…………………………………………………………4
- Difference between Products & Services…………………………………………..5
- Problems and Challenges to marketers…………………………………………….5
- 1. Introduction:
One of the most fundamental ingredients of any booming business is effective marketing. Marketing is a process by which the companies create value for the customers and put up strong customer interaction in order to confine value from customers in return. This form of marketing is viewed as business to customer marketing. Similarly, another aspect of marketing can be viewed as business to business marketing which is producing the value, solutions and relationships either short-term or long-term with a company/brand. Marketing is a term which is illustrated as a management process to identify, anticipate and satisfy the customer requirements valuably (Hunt, 2007).
Marketing with the set of associations, creates, communicates, delivers and substitute offerings that have value for customers, buyers/purchasers, partners and society at large (Keefa & Lisa, 2008).
Given that no firm can make a sale without setting a price for goods and services. In market-oriented environment, pricing plays an important and essential role to grow. To give and receive the value, marketers use a term “Price”. Pricing is one of the four Ps of marketing, having been more or less for thousands of years. It is the straightest way of communicating price to the customers and it directly impacts the bottom-line performance. Pricing is the only element of marketing which brings revenues and profits for a company. Although, there can be a variety of pricing situations i.e. competitive pricing, geographic based pricing, cost-based pricing, customer-based pricing, product line pricing and new product pricing.
Afterward, role and importance of pricing, characteristics of services, difference between services & products and challenges to marketer have been carried forward for the discussion.
2. Role of pricing in marketing:
Firstly looking at the role of pricing in marketing, it basically provides income to the sellers. Then it verifies and regulates the quantity supplied and consumed. Pricing also presents an indication in marketing through price incentives and discounts offered. It replicates the information about which products, services and qualitative features have to be provided more or less in the market. Because it is the most effective way to reveal the information to the producers about customers’ wants and needs and what they are willing to pay for. Finally, pricing determines the transfer of ownership. Once, the customer pays the price for the product, it makes the customer the new owner of that product (Hogan, 2010).
Moreover, new business models are evolving pricing practices. Current marketers imply new pricing strategies mainly focusing on the customers. Many marketers stress that they are offering the best quality at the lowest price. However, in a coherent economy, quality of the product offered and it’s price should be in direct proportion i.e. the higher a product’s quality would be, the more that product’s price should be. To make it more convenient to the customer, new pricing strategy is making an important role, is Internet/web pricing (Grewal & Roggeveen & Compeau & Levy, 2011). Internet pricing is the strategy of pricing an item differently on the website of company compared to other sales outlets. In sum, leading firms are adjusting the pricing strategies to the constant shifts in the competitive environment for best marketing activities. Pricing plays a significant role in marketing as a communicative instrument which not only represents the quality of goods and services but also signifies the firm’s focus on customer satisfaction.
3. Importance of Pricing in Marketing:
Furthermore, if effective product expansion, promotion and its distribution sow the seeds of a firm’s business success, effective pricing is the firm’s harvest (Thomas & Reed, 1995). In this context, importance of pricing as a marketing instrument has been discussed. Pricing judgment can have important outcome for the marketing firm and the attention given by the marketer to pricing is as significant as the attention given to more familiar marketing activities. Additionally, pricing is important in solving financial issues of a company, as the cash-flow level and fund-flow can be adjusted by manipulating the price. The price makes its importance for following reasons. Firstly, it improves the profitability by setting of price viewing at sales volume and turnover. Secondly, it allows large market share’s firm to operate cost-effectively and enables them to state the prices which weaker competitors have to follow.
4. Characteristics of Services:
When customers pay price for something that is for a product or for a service in return. For this, need arises to understand the concept of services and its characteristics. A service in marketing is a secondary field of marketing. Customers always concern for the quality and speed of service. In this context, characteristics of services can be described carefully.
First characteristic of Services is intangibility, it dictates that services are said to be intangible, because they cannot be touched or viewed. But, consumers have always an intention to know and measure the service value and quality, for that they can look for evidence of quality and other features. It becomes difficult for the service receiver to tell in advance what they will be receiving (Moeller, 2010).
Second point to be noted in services, is inseparability of production and consumption. It means services are produced near the point of acquisition and consumed at the same time. Service provider is an essential part of the service itself and cannot be separated from the service. A waiter/ress in a restaurant is an inseparable component of the service offering. The service receiver also shares to an extent in service and can also influence the outcome of service. People can also be a branch of the service itself, and this can benefit the service marketers (Moeller, 2010).
The next characteristic of service in marketing is perishibility, unused capacity of services cannot be taken for the consumption and cannot be stored for future purpose because it last a specific time. Travelling by plane or a train, an empty seat is a lost chance forever because service will only last the period of journey. When demand is stable for a service, perishibility does not create too much of a problem, but at the time of high or low demand for a service firms can have rigorous difficulties (Moeller, 2010).
The last and fourth characteristic of services is heterogeneity invariability. Services engage people and people are all poles apart from one another. There can be a sturdy possibility that the same enquiry will be countered to some extent differently and by the different person or by the same person. It can be characterized that a service is always distinctive; it exists once and its experience is never exactly repeated. Workforce training and careful supervising of customer pleasure and feedback can be helpful to keep up high standard service (Moeller, 2010).
The above defined characteristics are usually referred as what make the services so unique. Furthermore, the difference between products and services can be taken forward for the discussion.
5. The difference between products & Services:
A product comes in tangible form, which can be touched or seen. A product can be bought and sold. Whereas service is intangible, a service’s quality and value cannot be measured before consuming it. On the other hand, a product is well checked before paying price for that. Service cannot be produced in bulk and stored for future consumption or use, whereas Products are manufactured in mass quantities and stored for long period of time for both present and future prospects as well. Moreover, products hold expiry dates and labels with “best use before” and can be returned or resold. Whereas, the services don’t contain expiry dates and labels because they are produced and consumed simultaneously or as soon as possible. Moreover, services cannot be resold or returned by the firms. Some service providers prevail over this by presenting money-back guarantees. Distinction goes ahead with the invariability in products and services. A product is much more standardized and service is tailor-made. It is easy for the producer to manufacture the products with same size, scent and the quality but the service gets affected by several factors from both the employee’s and the consumer’s point of view.
Moreover, products can be counted in the same way as money is counted, but the service is not countable. It is leveled as good and better services. Talking about the last difference between products and services, a product is produced by several process of manufacturing, whereas a service is offered to the client by the efficient element of companies. A service is subscribed in the same way a gas and electricity is.
- 6. Problems and Challenges to the Marketers:
However this difference may create problems and challenges to the marketers. Because challenges are integral part of every business environment. Companies that are selling a product may face different challenges as compared to the companies promoting a service. It gets more complex in case of services because of its nature. In this context, packaging, appearance and presentation of a product can compel a customer to buy that product. However, a service being intangible is more difficult to promote it and to sell than a product. In this context, customers get inclined to the products rather than taking a service. This is a big challenge for the marketers as a requirement to know what the features and quality customers want generally. A product tends to fill and meet user’s demand, need/want. Therefore this can be used by the companies to sell a product. As a service is more about providing relationship and the importance of the relationship between provider and receiver. So, this set a challenge before the marketers to provide and perceive the worth of relationship, which can be tough to get across.
The point that poses too much of problem to the marketers is that marketing products involve multiple products that formulate the line. Product marketers serve a range of products and variety to meet the customer’s need or want. On the other hand, services usually have a single option which can be harder for the marketers to promote and status of one single service. Main problem arises related to the sale of a product or a service because marketers are spending much time on development and not on supporting sales. Currently, new products are being innovated and distributed, challenge is there that how to teach customers new behaviors, to introduce new and innovative product or services, to communicate the benefits of product and services effectively and to advertise the product or service. It also includes positioning of brand and to make the products or services different from the competitors (Gordon, N.D).
In case of service, key challenge is to know their customers better in terms of knowledge, tastes, preferences, after sales service and feedback.
- 7. Conclusion:
By emphasizing above discussed topics, it can be concluded that if a marketing firm have a clear competitive positioning policy, sales process, positioning strategy, pricing, distribution strategy and brand that will be more successful in making and managing the customers. Pricing plays a crucial role in marketing because usually customers are price sensitive. Customers need the product which is good in quality and also affordable by them. So, pricing place its importance in knowing the exact need of customers. Additionally, the characteristics of services generate the knowledge among consumers and present a clear image of difference between a product and a service. This again generates the problems and challenges to the marketers. It can be noticed that service marketers face the big challenges because characteristics of services are its challenges itself. Intangibility feature of the service marketing drops it in an arena of problems. Both Buyer and seller involves in creating the problems. Sellers are facing challenges due to unknown need and want of the customers for new and innovative products, and teaching the customers new behaviors. Whereas buyers don’t get to measure the value and quality they are being paid for. Thus, product’s, service’s features and their pricing need to be done and set by targeting the customer’s demand, need and want. Taking in account the knowledge about marketing, it is necessary to craft a decision on what to focus more (Product, service and price) and to implement into the marketing organizations.
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