MKT205 Module Four Milestone MC coursework PDF

Preview

Summary

MKT205 Module Four Milestone coursework paper required for week four....

Description

MKT 205 Module Four Milestone Worksheet Promotion and Price Michael Chacon Leila Samii July 19, 2021

PRODUCT “healthy” carob (chocolate substitute) bars

PERSONA Wendy, 28

PROMOTION FIRST MARKETING CHANNEL Description of first marketing channel: The first marketing tactic will be social media-based. Utilizing the popular social media apps, the company would first build on a following by using comedic posts and appealing pictures to describe the product and where it can be found. This tactic will increase word of mouth and introduce the locations where the product could be purchased. Why this channel is appropriate for this persona: This channel would be appropriate because Wendy spends a lot of her free time scrolling social media. Comedy and eye-catching art always grabs the attention of the product. Wendy makes her own money, and an attached URL shows an easy way to purchase online and local greengrocery stores that would sell the product.

SECOND MARKETING CHANNEL Description of second marketing channel: The second communication channel would be an in-person store event. This would introduce the product in-store to give customers who have been curious about the product but never bold enough to purchase. "It's not always about revenue, it's also about awareness and education" (SA, T.M, 2021, p.7). An expert sales associate would accompany the booth to inform the consumer about the product and give out free samples. Why this channel is appropriate for this persona: This method will work as a secondary because Wendy has always been curious about the product after seeing ads on Facebook. There are many other natural products at the store, so giving away free samples with an in-person event allows them to test. While the consumer tries the product, the sales associate gets to inform the details of said product. Allowing a more nervous buyer to test the product before purchasing lets them understand why they should choose the company’s product.

PRICE PRICING FACTOR: COMPANY PROFITABILITY Company profitability: First of all, to calculate profitability ratios, it would be looking at Gross profit equaling net sales minus the cost of goods. For example, if the cost to produce the chocolate bar is $1.38 with 10,000 units, our

cost of goods would be $13,800. Selling each bar at $5 per unit, we can have an expected gross profit of $50,000. This would make our profit $36,200 How pricing factor is used to determine pricing: Company profitability is the best approach to introducing our healthy chocolate alternative to the market. With an increase in organic chocolate coming into the market, a competitively priced product will showcase our offering to the consumers. The company will take a hit on profit margins at the beginning to beat competitor pricing, knowing that after selling 2,760 units, the company will finally be profitable.

PRICING STRATEGY: PENETRATION General advantages and drawbacks of penetration pricing strategy: The general advantage of penetration pricing is that the company is introducing a high-quality product at competitive pricing. Profit margins are lower for this method, but it builds on the company’s brand. The disadvantage of this method is that the company may report losses until profitability can be obtained. The advantage, though, is offering a quality product at low prices. Word of mouth will spread, allowing more units to be sold. "Profit is a term that often describes the financial gain a business receives when revenue surpasses costs and expenses" (Indeed, 2021, p. 1). Specific advantages and drawbacks of penetration pricing strategy: When Wendy heads out to the all-natural foods grocery store, she will be met with an abundance of all-natural chocolate. Overwhelming at first, she will look at the expensive brands to set a standard of what to expect. The pricing of our natural chocolate severely undercutting the expensive brand. She will compare our label to the competitions where Wendy will find we use the same all-natural ingredients. Wendy, being budget-conscious, will want to choose our brand because our higher-tier ingredients are not reflected in the pricing. The drawback for the company, though, is that until we sell a specific amount of units, we will be looking at a loss till the product can grab its place in the market shares, and we can turn a profit every quarter near the middle or end at a lower margin.

REFERENCES

How To Calculate Profit (With Example). Indeed Career Guide. (n.d.). https://www.indeed.com/careeradvice/career-development/how-to-calculate-profit. SA, T. M. (n.d.). In Store Marketing in 2021 - Tactics, Ideas, and Examples. https://www.tokinomo.com/in-storemarketing....