Mgt301 FinalTerm Short Notes PDF
Negative demand occurs
when potential customers hold unfavorable or biased views about your product.
For instance, in a community where people believe only fresh food is healthy,
frozen food is seen as unhealthy and faces negative demand. In such cases,
marketers must use a conversion marketing strategy to change the public
perception of frozen food and demonstrate its benefits.
No demand is a situation
typically encountered during the initial stages of a business. Here, customers
are simply unaware of your product or its advantages. To create awareness and
spark interest, companies employ creative and stimulating marketing techniques.
These methods aim to introduce the product to the market and create a desire
for it among potential buyers.
Latent demand describes
products or services that could be in demand, but the demand isn’t immediately
apparent or expressed by customers. A classic example is the early days of
insurance policies. Initially, people didn’t show much interest in insurance
because they weren’t fully aware of its value. Once marketers highlighted the
benefits, such as financial protection and peace of mind, people started to see
insurance as a necessity, and demand grew.
Declining demand occurs
when a product or service is losing its appeal and demand starts to fall. This
can happen for various reasons, such as changing trends or the introduction of
newer, better alternatives. In these cases, marketers use remarketing
strategies to breathe new life into the product. This could involve adding new
features, updating the product’s design, or repositioning it in the market to
reignite customer interest.
Full or regular demand
represents an ideal scenario where the demand for a product matches the
company’s production capacity. This balance is also known as adequate or
sufficient demand. In such a situation, marketers focus on maintaining this
demand level by continually engaging with customers and reinforcing the
product’s value proposition. The goal is to extend this period of full demand
for as long as possible to maximize benefits and profitability.
Irregular demand is seen
when the demand for a product fluctuates at different times. A good example is
the sale of air conditioners, which soar during summer but decline in winter.
To handle these fluctuations, marketers use demand-shifting and
synchro-marketing strategies. This can involve promotional discounts during
off-seasons or special campaigns to encourage demand when it’s low.
Overfull demand is when
the demand for a product exceeds the company’s production capabilities,
creating a challenging situation. To manage this overwhelming demand, marketers
implement de-marketing strategies. For example, electricity companies may raise
prices to control usage during peak times when supply is limited. The goal of
de-marketing is not to eliminate demand entirely, but to reduce it to
manageable levels.
Unwholesome demand refers
to demand for products that are considered harmful or undesirable, such as
narcotics, cigarettes, or other unhealthy items. In these situations, marketers
use counter-marketing strategies. This involves campaigns designed to
discourage the use of such products, like public service announcements
highlighting the dangers of smoking and promoting healthier alternatives.
In addition to these demand situations, marketers are guided
by different underlying philosophies or orientations that shape how they
approach the market:
The production concept
believes that customers mainly want products that are easily available and
reasonably priced. This leads companies to focus on mass production and
achieving economies of scale, ensuring that goods are readily accessible to the
market.
The product concept holds
that consumers prefer items that deliver top-notch quality, excellent
performance, and innovative features. However, an overemphasis on product
quality without considering actual customer needs can lead to marketing myopia.
A notable example is the mouse trap phenomenon in the United States. Companies
focused on producing better mouse traps, assuming that’s what people wanted,
while failing to recognize that customers actually wanted a broader solution to
get rid of mice, not necessarily just traps. As a result, many of these
companies struggled to sell their products.
The selling concept
assumes that customers won’t purchase enough unless the company puts in
significant effort through sales and promotions. While this “telling and
selling” approach can generate short-term sales, it’s not sustainable if the
product itself doesn’t meet customer expectations. In the long run, customers
will move on to better alternatives.
The marketing concept
emphasizes that achieving organizational goals depends on understanding and
meeting the needs and preferences of the target market more effectively than
competitors. This philosophy puts the customer at the center of all marketing
activities, ensuring that the company adapts to changing customer desires and
market dynamics.
Freemium pricing: Offering a basic version for free (such as
a 30-day trial) and charging for advanced features or continued use.
Reframing pricing: Breaking down the price to make it seem
more affordable, such as showing a course’s price per day instead of the full
fee.
Pay-Per-Click Advertising (PPC)
PPC ads appear on search engine results pages whenever users type in
specific keywords. Advertisers only pay when someone actually clicks their ad,
which is why it’s also called keyword advertising. Ads that appear are tied to
keywords and are part of a bidding system known as ad auctions. This system
guarantees that ads are closely matched to what users are searching for.
Location-Based and Mobile Marketing
With the widespread use of smartphones, mobile marketing has created new
opportunities for reaching consumers. Everyone carries their mobile phone
almost everywhere, using apps and social media to stay in touch. Marketers can
now deliver targeted messages to users based on their physical location, thanks
to GPS tracking. By using location-based APIs (application programming
interfaces), marketers can access real-time data on a user’s whereabouts and
send promotions specific to that area.
Social Media Marketing (SMM)
Social media marketing is all about promoting products and services through platforms like Facebook, Twitter, YouTube, and blogs. In the past, ads on TV or radio would vanish once aired. Social media has changed that by keeping your message alive and visible for as long as you want. This type of marketing has a clear advantage over traditional methods because it allows real-time interaction and direct engagement with consumers.
- The data highlights just how far social media can reach:
- · Facebook has around 350 million active users.
- · Over 346 million people read blogs, and 184 million people write their own blogs.
- · Twitter alone boasts over 14 million registered members.
- · YouTube claims more than 100 million viewers each month.
Every minute, more people are joining these platforms,
offering marketers an extensive audience to connect with and promote their
products.
Conclusion:
Understanding these different
demand situations and marketing philosophies is crucial for any business aiming
for long-term success. By recognizing how demand changes and which marketing
approaches work best in each scenario, companies can tailor their strategies to
better connect with customers. Whether it’s countering negative demand,
stimulating hidden demand, or sustaining full demand, a deep understanding of
these concepts allows businesses to stay competitive and responsive in today’s
dynamic market environment.
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