BUSINESS MANAGEMENT

CHAPTER 13 Marketing management INTRODUCTION TO BUSINESS MANAGEMENT kela the shapes of packaging and printed mat- tage of unusual sizes. Products packaged in un- information. Bright colours and striking de- usual sizes draw the consumer's attention, but at signs are used on packaging to attract the con- er can be used to store rusks, biscuits and Lick either for the sake of improvement. sumer's attention. The brand-loyal consumer. future packets of Ourna Rusks.) Reumble functional or aesthetic reasons. Just think the same time make price comparisons difficult. for example, will recognise from a distance the packaging leads to repeat purchases be nes the word new is used in combi- The label differentiates the product from oth- characteristic packaging of the detergent he/she cause consumers tend to collect the con ath a new kind of packaging. The product er similar products, especially if containers have buys regularly. tainers. The danger is that consumers may advertised in its new packaging to educate been standardised. stop buying when they have purchased ers about the new look of the packaging The label also serves as the carrier of the 13.11.5.1 Different kinds of packaging enough containers or if they are reluctars marketing message. The colours on the label Marketing management usually devotes a great to throw them away when the container packaging sizes are important in that market- are empty. deal of attention to choosing packaging and a management has to retain the sizes tradi- and the graphic design (letter types and illus- seedy used in the industry to save money, but tration) help to attract and hold the consumer's packaging design that will show off the contents attention. in the best possible way. The different kinds of 13.11.5.2 Choice of packaging design doing so has to forgo the competitive advan- packaging that can be chosen are the following: When it comes to the choice of the packaging Family packaging. All the products in the design, marketing management has to decide range are packed more or less identically. on the kind of packaging material, the shape NOW PRODUCT PACKAGING CAN HELP TO BOOST SALES The same packaging material is used and the and size of the packaging, and the graphic de sign on the label. jury consumers aren't aware of the extent to which packaging influences their purchasing choices. Bush sizes of packaging are more or less the same. masses of all sizes place a focus on how their products are packaged because packaging is consumers Family packaging is usually related to fam- The packaging materials (for example. gun important first contact with the products they buy. So. It is crucial that packaging attracts consumers to ily brands. (There are, however, exceptions, bottles, cans, cardboard boxes or plastic tubs) best suited to the product are chosen. Glass bot products as in the case of beer, where each kind has the graphics on product packaging are carefully designed to evoke emotions and feelings in the people an individual brand, but all have more or ties containing bottled fruit are more attractive the are considering buying them. For example, photos of people who are just like you can make you feel em- gey towards other users of the product, and to identify with them and buy the product. Bright, cartoon-style less similar packaging.) Pantene shampoo, than cans, for example, but they are impractical papties attract children to products. And different colours on packaging mean different things to consum- for example, is sold in identical bottles but to transport and usually more expensive. Mar. es my could mean excitement and action, for example, and blue could mean calmness and relaxation. with various labels to indicate the contents. keters often choose different and better types of packaging material than their competitors in Consumers initially view and handle the product in its packaging, so packaging often helps them to de- Family brands can facilitate consumer deci- an attempt to differentiate their products from side which product to buy when they are faced with a choice. So, product packaging becomes an extension sion-making because the packaging is cas- competitors' products. An example is the varie- afre product in the way in which it represents the product. Consumers aren't always consciously aware of ily recognisably. It can, however, also be a ty of packaging used for certain types of liquor. this function of packaging. source of irritation. The consumer may pur- with each item in a different type of bottle. Expensive packaging can also increase the price of a product, so marketers need to be aware of what their chase a product that he or she does not re- The shape of the packaging or container may packaging and its quality says about the products they sell. Expensive packaging suggests a better-quality ally want if the labels and colours resemble have a specific functional value, such as reus- product than cheaper packaging each other too closely. ble plastic tubs for margarine. The shape may Marketers also need to understand their competitors' packaging. This can guide them to decide which Speciality packaging. This gives an image also have a symbolic value, which may subcon quality of packaging they need to use to compete, and how to design their packaging to stand out from their of exclusivity to the product. Perfume, jew- sciously influence buyers. A square shape is competitors' packaging. supposed to have male connotations, whereas Packaging will not hold a consumer's attention for very long. So, marketers need to ensure that their ellery and expensive liquor (for example, packaging has an emotional effect on consumers within a few seconds, the distinctive triangular boxes of Toblerone female consumers prefer flowing and round shapes. These types of 'male and 'female" shapes Is important for packaging not only to look good, but to work properly too. If a product is easy to open, Swiss Chocolates) are often sold in speci- we and store in its packaging. for example, consumers are more likely to buy the product again. If consum- ality packaging. Such products are popular for packaging are especially noticeable in the gifts. case of toiletries. en struggle with the product's packaging in the course of using the product, however, they will likely try a Characteristic packaging helps consumers to competitor product in future. Reusable packaging. This creates the im- recognise the product on the shelf, even from a pression that the consumer receives a 'free' distance. This explains why it is not desirable to Sources Adapted from Smart Marketing. n.d. How can packaging increase sales. Available at http:/ / www.smartmake- container if he or she buys the product. The change packaging without informing consum "eaud com/ blog/how-can-packaging-increase sales/. [Accessed 9 November 2015); Chron, nd. Packaging et: container can be reused for something else ers properly. This does not mean that contain 18 May 20161. has on marketing. Available at http:/ / smallbusiness.chron.com/packaging effects-marketing-61726.html. [Accessed later. (An example is the metal container in ers should never be modified. Changes are often which Ouma Rusks are sold. The contain- 443 442CHAPTER 13 Marketing management INTRODUCTION TO BUSINESS MANAGEMENT 13.11.6 Product differentiation ANDNATIVE PACKAGING: THE COCA-COLA PLANTBOTTLE Marketing management also has to decide on the isfaction. Planned obsolescence also contriby West's PuntBottle programme represents a breakthrough in CPG packaging innovation that makes way in which the product should be differentiat- utes to economic progress and job creation. An interesting example of planned obsolescence is ple resources and that is 100 per cent compatible with existing packaging recycling setups. ed from other competing products. Product dif- the Volkswagen Beetle, which made a dramatic wellpackaging looks and feels the same as the regular plastic bottles but, using an environmentally ferentiation means that a business distinguishes its product, physically and/or psychologically. comeback a few years ago. The new Beetle doesn't newable, plant-based manufacturing process. PlantBottles are aligned to existing PET recycling from essentially identical competing products, so have an air-cooled engine at the back like the ong: s leading to a smaller carbon footprint. that the product is regarded as a different product inal Beetle. Instead, it has a two-litre water-cooked present 212 worked with Coca-cola's global packaging team to translate complex and contentious by consumers in a specific target market. Physical engine in the front of the car. Not much of the old wees in polymer production into a clear and compelling consumer proposition. The PlantBottle brand and psychological differentiation can take place Beetle was incorporated in the new version. nehed from the concept development and strategic positioning work undertaken by Fahrenheit 212. on the basis of design, quality, colour, taste, size, 13.11.8 Multi-product decisions PlantBottle prototype was released in 2009 and it has since been distributed in more than 35 brand, packaging or any other distinguishing soon bottles in nearly 40 countries. feature, such as price, the marketing communi- Marketing management also has to make de we movetive packaging has resulted in eliminating almost 100 000 tons of CO, emissions (the equi- cation message or the type of distribution out- cisions on the composition of the product of and over 200 000 barrels of crude oil). The plant material used to make part of the plastic component let. One of the best examples of differentiation fering (see section 13.11.1). A business seldom seek sourced from sugar cane while the traditional PET bottle is made from 100 per cent fossil fuels is found in the car market when a new model is manufactures and markets one specific product has a higher carbon footprint. On average. PET manufacturing can produce about three tons of carbon added to the range to differentiate the product item only. The product offering usually consists (CO.J. Approximately a third of the PlantBottle is replaced with this natural, plant based material. from competitors' products. Another example is of a product range or even a diversified variety Chel-Cols announced in 2012 that it has set a goal to use this durable PlantBottle packaging technology how Mcdonald's uses its wide range of products of product items and ranges. The total product brad of its plastic bottles by 2020. to reach a wider market range. These products offering of a business changes continually Prof. include salads for consumers opting for a health- itable opportunities occurring in the market are Asort Adapted from Fahrenheit 212. n.d. Coca-cola PlantBottle: Defining the consumer proposition for bio-PET. ier choice or the breakfast menu for those who utilised through the development of new prod. Mabele at http://wwwfahrenheit-212.com/coca-cola plantbottle/. [Accessed 14 August 2015]: Petjonno, M. 2015. prefer breakfast on the move. ucts or by takeovers of existing businesses in. Can Cou's sew bottle is made only from plants. Available at http://mashable.com/2015/06/09/coca-cola-plantbot- cluding, naturally, the product items and ranges marketed by those businesses. WILanONE:5ow. [Accessed 27 Mat 2016]: Karluki, D. 2015, The PlantBottle - new plastic bottles made completely 13.11.7 Product obsolescence Multi-product items in the total product of hmm planes. Available at hittp://cleanleap.com/plantbottle-new-plastic-bottles-made-completely-plants. [Accessed 27 An important product decision concerns prod- fering reduce the risk of failure and financial #20151: Heritage Pioneer Corporate Group, n.d. What is the Coca-cola PlantBottle? Available at http:/ www.hpcorpo: uct obsolescence. A product may intentionally loss because the success and profit of one prod. wepoop .com/what is the-coca-cola-plantbottle.html. [Accessed 27 May 2016] be made technically and/or psychologically ob- uct item can compensate for the poor perfor- solete in order to compel the consumer to make mance of another product item. repeat purchases. At the technical level, prod- ucts can be designed to have a specific lifespan. 13.11.9 New product decisions An example is Duracell batteries. Psychological Product decisions also have to be made about DIFFERENT KINDS OF DIFFERENTIATION obsolescence points to the introduction of a the development of new products. Each product new model or style, resulting in the consumer starts its life as an idea, conjured up by someone Differentiation by means of packaging and brand. The various types of margarine in the market are rejecting the 'old product, which may still be A sales representative, a dealer, a technician in sstingwished by the use of different types of packaging, such as plastic, foll or waxed paper, the brands, completely effective technically. New car mod- the manufacturing division or a consumer may be designs on the labels and the colours used. els and new fashions are well-known examples suddenly get an idea about a product that will Differentiation by advertising appeals. Advertising appeals for one brand of detergent emphasise the of planned psychological obsolescence. meet specific consumer needs, and that the thyme-active ingredients'. For another detergent, the 'stain-removing powder" is underlined and for yet The strategy of planned obsolescence is often business should be able to manufacture and mother detergent, the advertising appeals focus on the 'clean, fresh smell. criticised because it leads to the waste of scarce market. Successful large businesses often have . Differentiation on the basis of price. There are big differences in the pricing of cosmetic products, for resources and aggravates the pollution problem. new-product venture teams, consisting of var example Revion products cost much less than Estee Lauder products. However, the fact remains that new models are ious functional experts who actively and coo- stantly seek new ideas for new products. In such best known jewellers. Differentiation on the basis of distribution outlet. Rolex watches are available only at the biggest and usually technically better than the earlier ones, thereby contributing to greater consumer sat- businesses, top management usually encourages 444 445Question 2 [Ma $5: 3;]! Read the Case Study: "T he Woolworths strategy in implementing the marketing concept" on pages 443 - 444 in the prescribed textbook and then answer the following questions. Note: You will need to conduct research beyond the textbook. 01.2.1 The eyolution in marketing thought led to the development of the marketing [3] concept employed by Woolworths. Explain the stage in the evolution that Woolworths is in now. [1.2.2 Explain the four principles of the marketing concept. Use quotes from the case [3] study to show the strategies that Woolworths employed when implementing the marketing concept. [1.2.3 Explain the importance of packaging and identify type of packaging that [4] Woolworths will focus on according to their strategy. (11.2.4 Explain the concept of brand loyalty and 1Woolwor'ths approach to increasing [5] brand loyalty. (1.2.5 Explain Woolworths leadership role in the distribution channel. [4] 1.25 Identify three criteria 1ilil'ocllworths could use for market segmentation. Justify [6] your choices