INTRODUCTION TO CONSUMER PSYCHOLOGY:Marketing Mix, Product, Price

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Consumer Psychology (PSY - 514)

Lesson 03

INTRODUCTION TO CONSUMER PSYCHOLOGY

(MARKETING MIX)

OBJECTIVES:

Introducing the Concept of Marketing Mix

o Understanding the four elements of Marketing Mix::

Product

Price

Place

Promotion

o Services

Marketing Mix

Marketing Mix consists of the tools available to a business to gain the reaction it is seeking from its target market

in relation to its marketing objectives. It consists of company's services/and or products offerings to consumers

and methods and tools it uses to accomplish the exchange. The marketing mix consists of four elements:

Product or Service

The Price

The Place

Promotion

1. Product

Product is anything that consumer acquires or might acquire to meet a perceived need. Product features, design,

brands, and packaging offered along with post purchase benefits such as warranties and return policies. Consumers

don't purchase physical features of a product, they buy the perceived benefits.

Various ways are used to improve/differentiate the product and increase sales or target sales more effectively to

gain a competitive advantage e.g. some of the ways are:

· Extension strategies

· Specialised versions

· New editions

· Improvements real or otherwise!

· Changed packaging

· Technology, etc.

Consumer Psychology (PSY - 514)

2. Price

Price is the amount of money one must pay to obtain the right to use the product. This means the list price,

including discounts, allowances, and payment methods.

Economists often assume that lower prices will result in higher sales. Price sometimes serves as signal of quality

also. A product priced too low might be perceived as having very low quality and a product priced too high might

be perceived as of a very high quality. Simultaneously, owning an expensive item also provides information about

the consumer. It can dictate that the owner can afford an expensive item

It is important here to note that the price of a product is not the same as the cost of the product.

Consumer Cost is everything a consumer must surrender to receive the benefits of owning/using the products.

3. Place

Having the product available where the target consumers could purchase it. The distribution of product or services

may be made through specific stores and non-store outlets.

Consumer Psychology (PSY - 514)

4. Promotion

Promotion consists of Strategies to make the consumer aware of the existence of a product

or service. This includes advertising, sales promotion, public relations, and sales efforts designed to build

awareness and demand for the product or services. Promotion is NOT just advertising

The basis of successful promotion is developing an effective communication strategy and an effective

communication strategy requires answers to certain important questions. Which are:

The Five Questions of Promotion

With whom exactly do we want to communicate?

What effect do we want our communications to have on our target consumers?

What message will achieve the desired impact on our audience?

What means and media should we use to reach the target audience?

What should we communicate with our audience?

a) With whom exactly do we want to communicate?

Target Market Member

Channel Members

Example: Pediatric nurses are often asked for advice concerning diapers and other non medical infant

care. A firm marketing such items will be wise to communicate with such individuals directly in their

promotion

b) What effect do we want our communications to have on our target consumers?

Often a manger will state that the ultimate objective of all communications is to improve the sales, while this may

be the ultimate objective, however, the behavioral objectives are often of much more importance. It may seek to

provide more information to the audience, educate the audience on certain features of the product, recommend

the product to others, feel good about having bought the product, etc..

c) What message will achieve the desired impact on our audience?

What words, pictures visuals will be used, how a particular word is interpreted by the target audience, what kind of

symbolism may be used.

d) What means and media should we use to reach the target audience?

Can we rely on the packaging of the product to provide information or should we use media, and if so what type

of media should we use

e) What should we communicate with our audience?

Should we concentrate in our communications near the time purchase tend to be madder or evenly through out

the week or the month? Do consumers seek out information shortly before the purchase of our product? If so,

then where? Answering these questions requires knowledge of the decision process used by the target market for

this product.

5. Services

Earlier we defined product to include services. The services products may be like medical treatments, car repairs or

haircut; however, in this section we are discussing services to refer to auxiliary or peripheral activities that are

performed to enhance the primary product or service. For example a fast food restaurant may offer fee delivery; a

car repair shop may offer free pick up and delivery. Auxiliary services are used add tactical advantage to a certain

product and these cost money to the company. Therefore, these must be planned carefully and only those services

need to be added that will provide maximum value to the consumers.

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