Marketing is key to understanding consumers and making your product/service attractive. The marketing concept, as described in the textbook is “is a consumer- oriented philosophy that focuses all available resources on satisfying the needs and wants of the consumer, thereby resulting in profits” (Bojanic & Reid, 2009). What this quote is saying is that the marketing concept tries to identify what consumers want, what they need, and what the best way to communicate your product to the consumer is.
Instead of Just throwing your product on the market at a random price nd hoping it will do well, the marketing concept trys to identify the best possible way to advertise your product. In order to use the marketing concept properly, managers must effectively use the 4 p’s aka the marketing mix in order to learn what their customer’s truly want. The 4 p’s stand for price, product, place, and promotion. These four p’s make up the first layer of the marketing mix surrounding the target market. Surrounding the 4 p’s are the 5 environment: economic, competitive, political and legal, social, and technological.
The 4 p’s are the first layer around your target arket within the marketing process and are essential for marketing success. The first p is price. Price stands for the value a firm puts on their good or service. A few variables which affect the price of a product is perceived value. If consumers believe a product is of better quality than similar products on the market, the firm is able to charge more for their product. As well, firms may choose to use discounting strategies or base their price against the competition. The second p refers to the product/service itself.
The product refers to a firms unique product/service mix. It is all of the products and services in which the firm offers including both tangible and intangible products. Product also refers to the unique qualities of a firms products such as particular attributes, quality, the variety of products the firm offers, as well guarantees and warranties. The third p known as place is also referred to as distribution. This is how your product actually reaches the consumers. This includes where your products will actually be sold and the intermediaries used for your product to reach that destination.
The last p stands for promotion. Promotion is how the firm communicates with the customer, whether through advertising, personal selling, sales promotion, and their public relations teams, promotions is very important for firms to communicate to the consumers about their products. The major factor which affects the promotion mix is the amount a firm has to spend on each component of the promotion mix. The second layer to the marketing process is the marketing environments. As mentioned earlier they are economic, competitive, political and legal, technological, and social.
These five environments can give early igns to hospitality firms about what is going on in the world around them. For example, the hospitality industry has been faced with many challenges in the past couple years from international terrorism to new eating trends. These are things which can be categorized under 1 of the 5 major marketing environments and if monitored properly can give firms early warning about changes in the world as well as opportunities to the first to take advantage of a new emerging trend. The first marketing environment is economic.
The economic environment is related to the ower of a city or their discretionary income in order to find out if it is profitable for them to market their products in a certain location. For example, you would not put a Bentley car dealership in a low income neighbourhood. The second environment is the competitive environment which looks at how many buyers and suppliers there are in the market. A market can range from a monopoly (one seller with many buyers) to monopolistic competition where there are any buyers and sellers of varied products.
One major thing which must be considered when looking at the ompetitive market is the price elasticity of a product. Price elasticity means “A measure of the percentage change in demand for a product resulting from a percentage change in price” (Bojanic & Reid, pg 23). Three main questions must also be asked when analyzing the competitive market which are “should we compete? If we compete, in what markets should we compete? And what should our competitive strategy be? ” (Bojanic & Reid, pg 24). The Political and Legal environment means being up to date on laws and regulations within a certain area.
Whether there are environmental rules or different drinking ages, hospitality firms must be aware of current and future laws and regulations to stay ahead of the game. The next environment is the technological environment. This environment deals with any advances in technology such as mass bookings or central reservations systems. The technological environment is very important because consumers are expecting hotels, restaurants, and airlines to be as up to date as possible. This means express check-in, self-check-out, online boarding passes, user friendly websites, etc.
The final environment is the social environment which deals with the demographics of people and new emerging trends. A great example of a current social trend is the shift to healthy eating. The demographic side of the social environment deals with the people within a certain area. For example, if there is an influx of families compared to students, this will greatly change the social environment of a certain area. The 4 p’s in conjunction with the 5 major marketing environments are essential in making up the marketing process