Chapter 10 Marketing The Small Business

CHAPTER 10
MARKETING THE
SMALL BUSINESS
1
PRAYER
Eternal God, in whom mercy is endless and

the treasury of compassion inexhaustible,
look kindly upon us and increase your mercy
in us, that in difficult moments we might not
despair nor become despondent, but with
great confidence submit ourselves to Your
holy will, which is Love and Mercy itself.
Amen.
Jesus, we trust in You!
2
MARKETING
is the function that

concerned with planning and
implementing the conception,
pricing, promotion, and
distribution of products or
services that will satisfy the
firm’s objectives.
3
MARKETING CONCEPT
Provides a guide to small

business.
indicates that a match must be
made between its intended
customers and the firm’s
product or service offerings.
4
TO ACHIEVE THE DESIRED MATCH,
THE FOLLOWING QUESTIONS
MUST BE ANSWERED:
1. Who are my customers?

2. What products or services
are needed by my
customers?
3. At what price are the
products or services
required?
5
TO ACHIEVE THE DESIRED MATCH,
THE FOLLOWING QUESTIONS
MUST BE ANSWERED:
4. At what place are the identified

products or services required
5. At what time are the identified
products or services required?
6. At what mode of delivery are
the identified products or
services required?
6
TO PROVIDE ANSWERS TO THE
QUESTIONS, THE FIRM
UNDERTAKE THE FOLLOWING:
1. Devise a marketing strategy
2. Engage in marketing research
3. Develop a marketing mix
4. Identify the size of the target
market
7
MARKETING STRATEGY
is the general guide the SBO

will use to achieve the firm’s
marketing goal.
is a plan for getting products
and services into the hands
of customers in a timely,
cost effective and
appropriate manner.
8
MARKET STRATEGY
PLANNING
is a small business activity

which seeks to find
attractive opportunities
and develop profitable
marketing strategies.
9
THE OUTPUT OF MARKET
STRATEGY PLANNING
1. The target market

2. The applicable marketing
mix
3. The size of the market
area
10
TARGET MARKETING
refers to the activity of

selecting well-defined
groups of potential
customers and tailoring a
marketing mix to their
needs and preferences.
11
THE FOLLOWING STEPS
IN TARGET MARKETING:
1. Identification of the target

market
2. Identification of the
characteristics of the target
market
3. Measurement of the size of the
target market area
12
TARGET MARKET
defined as the particular

market segment the firm
wishes to serve.
13
THE NUMBER OF SEGMENTS
THE SBO WISHES TO SERVE:
1. A mass market company –

which sells goods and
services to a broad
spectrum of buyers.
2. A market-segment company
– which aims to sell to a
single market segment
14
4. A multi-segment company – which
aims to sell at two or more distinct
market segments
15
CHOOSING THE TARGET
MARKET
1. The goods or service

category of the firm
2. The firm’s goals
3. What competitors are doing
4. The size of the various
segments
16
5. The relative efficiency of
each segment to the firm
6. The resources required
7. Other factors
17
IDENTIFYING THE
CHARACTERISTICS OF THE
TARGET MARKET
Relevant characteristics
will refer to any of the
following: age, sex, family
size, family life cycle,
income, occupation,
religion, race and
nationality.
18
MEASURING THE SIZE OF
THE TARGET MARKET AREA
1. The number of
potential customers
2. The population
growth trend of the
target market area.
19
MARKETING MIX
refers to the set of

marketing tools that the
firm uses to pursue its
marketing objectives in
the target market.
20
MARKETING TOOLS
are the controllable

variables that when
properly blended
constitute the marketing
mix.
21
THE CONTROLLABLE
VARIABLES
1. Product offering (including the
breadth of the product line,
quality levels, and customer
services)
2. Price
3. Promotion (sales promotion and
salesforce decision)
4. Place (distribution)
22
PRODUCT OFFERING
The products sold by the firm could be

offered so that customers will prefer
them over the competition
The products may involve a physical
good, a service, or a combination of
both
Includes packaging, warranties, and
guarantees, associated with service,
intallations and maintenance.
23
PRICE
Is what charged for the

product offered for sale.
In setting the price the
primary consideration is
profits, but it must be
determined in relation to cost
of production and marketing
24
PROMOTION
refers to communicating
information between the
company and potential buyers
to influence buying attitudes
and behavior.
25
PROMOTION TAKES THE
FORM OF ANY OR ALL OF
THE FOLLOWING:
1. Personal selling – involves direct
communication between sellers
and potential customers
2. Advertising – consists of any
form of paid, nonpersonal
presentation of ideas, goods, or
services.
26
3. Sales promotion – a
promotion activity that
stimulates interest, trial,
or purchase by final
customers.
27
PLACE
Refers to making
products available in
the right quantities and
locations when
customers want them.
28
TYPES OF MARKET
RESEARCH
1. Primary research
2. Secondary research
29
PRIMARY RESEARCH
1. Observation – involves collecting

data by observing the actions of a
person or a group of persons.
2. Survey – consists of gathering data
by interviewing people: personal
interview, telephone survey, by mail
or by the internet.
30
3. Experimentation – involves
observing the results of
changing one variable in a
situation while holding all other
conditions constant.
31
SECONDARY RESEARCH
1. The company’s records

2. Libraries
3. Government agencies
32
MARKET SHARE
FORECASTING
1. Define the physical limits of the
target market area
2. Determine the potential sales
of the target market
considering its demographic
characteristics.
3. Determine the purchasing
power of the target market
33
4. Determine the total sales
revenue of the industry in the
target market area.
5. Determine the percentage of
the total sales that can be
effectively served by the
company.
34
POTENTIAL SALES OF
THE TARGET MARKET
refers to the total sales

volume that all
competitors could
achieve in that
particular market
segment.
35
SALES POTENTIAL OF
THE COMPANY
refers to the portion of
the market potential that
the company could
expect to achieve under
ideal conditions.
36
COMPANY SALES
Refers to the actual sales

made by the company as
opposed to the potential
sales of the company.
37
FORECASTING COMPANY
SALES
1. Market factor analysis

2. Survey of buyer
intention
3. Test marketing
4. Past sales analysis
38
5. Trend analysis
6. Sales-force composite
7. Executive judgment
39
MARKET-FACTOR
ANALYSIS
This is a sales forecasting
method that assumes the future
demand for a product is related
to the behavoir of certain
market factors and, as result,
involves determining what
these factors are and then
measuring their relationships to
sales activity.
40
SURVEY OF BUYER
INTENTIONS
This is a sales forecasting

method in which a company
asks a sample of current or
potential customers how much
of a particular product they
would buy at a given price
during a specified period of
time.
41
TEST MARKETING
This is a method of sales

forecasting in which a company
markets its new product in a
limited geographic area,
measures the sales, and then
from this sample, a projection is
made for the company’s sales
over a larger area.
42
PAST SALES ANALYSIS
This a method of sales

forecasting that applies a
flat percentage increase to
the average volume
achieved last year or to the
average volume of the past
few years.
43
TREND ANALYSIS
This is a statistical
method of forecasting sales
over the long term by using
regression analysis or over
the short term using a
seasonal index of sales.
44
SALES-FORCE
COMPOSITE
This is a method of
forecasting sales that
consists of collecting from
all sales people estimates of
sales for territories assigned
to them during the future
period of interest.
45
EXECUTIVE JUDGMENT
This is a method of
forecasting sales that
consists of obtaining
opinions regarding future
sales volume from one or
more executives.
46
QUESTIONS FOR REVIEW
AND DISCUSSION
1. What are contained in a marketing strategy?

2. What steps are undertaken in target marketing?
3. What is the target market?
4. What are the methods of conducting primary
research?
5. What are the possible sources of secondary data?
47
SUGGESTED ITEMS FOR
RESEARCH
Identify a small business with a

research problem and indicate
how the problem may be
addressed.
48
THANK YOU!
49

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CHAPTER 10

Eternal God, in whom mercy is endless and

is the function that

Provides a guide to small

1. Who are my customers?

4. At what place are the identified

is the general guide the SBO

is a small business activity

1. The target market

refers to the activity of

1. Identification of the target

defined as the particular

1. A mass market company –

1. The goods or service

refers to the set of

are the controllable

The products sold by the firm could be

Is what charged for the

1. Observation – involves collecting

1. The company’s records

refers to the total sales

Refers to the actual sales

1. Market factor analysis

This is a sales forecasting

This is a method of sales

This a method of sales

1. What are contained in a marketing strategy?

Identify a small business with a

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