Marketing · Lesson 2

Marketing mix, product classes, product life cycle, pricing, branding, packaging and labelling

WAECNECO

What the syllabus asks

WAEC: product, price, place, promotion), 4 (Products: meaning, classification incl. primary/secondary, mineral oil and non-oil; product design), 8 (Pricing: meaning, objectives, methods: haggling, cost-plus, demand, competition; determinants) and 11 (Merchandising: packaging, branding, labelling). JAMB does not examine Marketing.

NECO: product, price, place, promotion), 4 (Products: meaning, classification incl. primary/secondary, mineral oil and non-oil; product design), 8 (Pricing: meaning, objectives, methods: haggling, cost-plus, demand, competition; determinants) and 11 (Merchandising: packaging, branding, labelling). JAMB does not examine Marketing.

What you will learn

Explain the marketing mix and why its elements must fit together.
Define a product and distinguish its three levels.
Classify products in several ways, including WAEC’s primary/secondary and oil/non-oil.
Describe product design and the stages of new product development.
Explain the product life cycle and the strategy at each stage.
Explain pricing objectives, determinants, methods and strategies, with calculations.
Explain packaging, branding and labelling and Nigerian labelling rules.

Key points

Marketing mix: product, price, place, promotion; services add people, process, physical evidence.
Product: core, actual, augmented levels.
Consumer goods: convenience, shopping, speciality, unsought.
Industrial goods: raw materials, parts, installations, accessories, supplies.
WAEC classes: primary, secondary, tertiary; oil vs non-oil.
New product development has eight stages from idea to commercialisation.
PLC: introduction, growth, maturity, decline; strategies change by stage.
Price objectives and determinants: cost, demand, competition, government, objectives.
Methods: haggling, cost-plus, demand, competition; break-even = FC ÷ (P − VC).
Strategies: skimming, penetration, psychological, discounts (apply in sequence).
Packaging protects, promotes, informs; branding identifies; labelling informs (NAFDAC 2022, SON MANCAP/SONCAP).
Essay technique: define, explain, Nigerian example.

Start here: The marketing mix

In mk1 you met the marketing environment: forces outside the firm that it cannot control. The marketing mix is the opposite: the set of controllable marketing variables that a firm blends together to produce the response it wants from its target market. The idea was popularised by Neil Borden, and E. Jerome McCarthy grouped the ingredients into the famous four Ps: Product, Price, Place and Promotion.

The four Ps

Product: the good or service itself, its quality, features, design, brand name, package, sizes, warranty and after-sales service.
Price: what customers pay, including the list price, discounts, allowances, credit terms and payment period.
Place (distribution): how the product reaches customers, the channels, intermediaries, outlets, coverage, stock levels, warehousing and transport.
Promotion: how the firm communicates with customers, through advertising, sales promotion, personal selling, publicity and public relations.

Why it is called a “mix”

The four elements must fit together. Think of a cook making egusi soup: the right ingredients in the wrong amounts give a poor soup. A premium bottled water sold at a very low price in kiosks with no advertising sends confusing signals. A cheap sachet product sold only in expensive malls misses its buyers. A good mix is consistent (every P tells the same story), targeted (built around a chosen market) and flexible (it is changed as conditions change).

The extended mix for services

For services, many textbooks add three more Ps to make seven Ps: People (staff who deliver the service), Process (the steps and systems the customer goes through) and Physical evidence (the building, uniforms, receipts and other tangible signs of quality). A bank, a hospital or a school must manage all seven. These are treated more fully in mk7.

Mix and environment together

A firm studies the uncontrollable environment and then adjusts its controllable mix. When inflation reduces incomes (economic environment), a detergent maker may introduce smaller packs (product) at lower unit prices (price), sell through more neighbourhood kiosks (place) and run radio adverts in local languages (promotion).

Worked example 2.1

A firm introduces 20 g sachets of tomato paste for low-income buyers. Which element of the mix has it changed first? Product (pack size), with knock-on effects on price.

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Practice questions

1. The 4Ps of the marketing mix are product, price, place and

promotion
people
process
physical evidence

Show answer

A: promotion
The last three are added for services.

2. Bread and salt bought often with little effort are

shopping goods
speciality goods
unsought goods
convenience goods

Show answer

D: convenience goods
Bought frequently.

3. Goods compared on price and quality before buying, such as clothes, are

speciality goods
unsought goods
shopping goods
convenience goods

Show answer

C: shopping goods
Compared before buying.

4. The product life cycle stages in order are

decline, maturity, growth, introduction
introduction, growth, maturity, decline
growth, introduction, decline, maturity
maturity, growth, decline, introduction

Show answer

B: introduction, growth, maturity, decline
Profits peak in growth/maturity.

5. Setting a low price to win a large market share quickly is

penetration pricing
price skimming
prestige pricing
cost-plus pricing

Show answer

A: penetration pricing
Skimming starts high.

Key words

Marketing mix: Controllable variables: product, price, place, promotion.
Core product: The basic benefit a buyer seeks.
Augmented product: Extra services such as warranty and delivery.
Convenience goods: Frequently bought with little effort.
Shopping goods: Bought after comparing alternatives.
Speciality goods: Unique items buyers make special effort to get.
Unsought goods: Products buyers do not normally seek.
Product life cycle: Stages from launch to withdrawal.
Mark-up: Profit as a percentage of cost.
Margin: Profit as a percentage of selling price.
Price skimming: High launch price, lowered later.
Penetration pricing: Low launch price to win share.

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