Marketing Strategies For Baby Products Business
Businesses compete to serve customer needs and when you are dealing with a market of baby products you have to be very careful with their needs. Having a baby products business is something that in a way needs special attention. Not only that there are different types of customers in the baby products business, but their needs vary, too. Everyone has a family and each family and kid has different needs. Thus, most markets are not homogeneous. Further, the markets that are homogeneous today may not remain so in the future. In brief, a market represents a dynamic phenomenon that, influenced by customer needs, evolves over time, considering building a baby products business that will evolve with your client?s family. In a free economy and we have such a free economy, each customer group tends to want a slightly different service or product. But a business unit cannot reach out to all customers with equal effectiveness; it must distinguish easily accessible customer groups from hard-torched customer groups. Moreover, a baby products business faces competitors whose ability to respond to customer needs and cover customer groups differs from its own. To establish a strategic edge over your competition with a viable marketing strategy, it is important for the business unit to clearly define the market it intends to serve. You must segment the market, identifying one or more subsets of customers within the total market, and concentrate its efforts on meeting their needs. Fine targeting of the customer group to serve offers the opportunity to establish competitive leverage.
Satisfaction of customer need is the ultimate test of your baby products business success. Thus, an effective marketing strategy should aim at serving customer needs and wants better than competitors do. Focus on customers is the essence of marketing strategy. Customer need has always formed the basis of sound marketing. Looking closely at needs is the first step in delivering value to customers. Traditionally, needs have been classified according to Maslow?s hierarchy of human needs. From lowest to highest, Maslow?s hierarchy identifies five levels of needs: physiological, safety, belongingness, self-esteem, and self-actualization. Needs at each level of the hierarchy can be satisfied only after needs at the levels below it have been satisfied. A need unsatisfied becomes a source of frustration especially for a young mother who does not manage to find understanding and support once she enters your baby products business. We are going to discuss segmentation criteria. Segmentation criteria vary depending on the nature of the market. In consumer goods marketing, where baby products businesses fit in, one may use simple demographic and socioeconomic variables, personality and lifestyle variables, or situation-specific events (such as use intensity, brand loyalty, and attitudes) as the bases of segmentation.
Conceptually, the following procedure may be adopted to choose a criterion for segmentation:
1. Identify potential customers and the nature of their needs.
2. Segment all customers into groups having
a. Common requirements.
b. The same value system with respect to the importance of these requirements.
3. Determine the theoretically most efficient means of serving each market segment, making sure that the distribution system selected differentiates each segment with respect to cost and price.
Basis for Customer Segmentation - Consumer Markets
1. Demographic factors (age, income, sex, etc.)
2. Socioeconomic factors (social class, stage in the family life cycle)
3. Geographic factors
4. Psychological factors (lifestyle, personality traits)
5. Consumption patterns (heavy, moderate, and light users)
6. Perceptual factors (benefit segmentation, perceptual mapping)
7. Brand loyalty patterns
An interesting development in the past few years has been the emergence of a new segmentation concept called micromarketing, or segment-of-one marketing. You should also know how to apply marketing techniques such as this one to your baby products business. Forced by competitive pressures, mass marketers have discovered that a segment can be trimmed down to smaller sub-segments, even to an individual. Micromarketing combines two independent concepts: information retrieval and service delivery. On one side is a proprietary database of customers? preferences and purchase behaviors; on the other is a disciplined, tightly engineered approach to service delivery that uses the database to tailor a service package for individual customers or a group of customers. Of course, such custom-designed service is nothing new, but until recently, only the very wealthy could afford it. Information technology has brought the level of service associated with the old carriage trade within reach of the middle class.
1. Knowing the customers?Using high-tech techniques, find out who the customers are and aren?t. By linking that knowledge with data about ads and coupons, fine-tune marketing strategy.
2. Making what customers want?Tailor baby products product packages to individual tastes.
3. Using targeted and new media?Advertising on cable television and in magazines can be used to reach special audiences. In addition, develop new ways to reach customers. For example, messages on walls in high-school lunchrooms, on videocassettes, and even on blood pressure monitors may be considered.
4. Using non-media?Sponsor sports, festivals, and other events to reach local or ethnic markets.
5. Reaching customers in the store?Consumers make most buying decisions while they are shopping, so put ads on supermarket loudspeakers, shopping carts, and in-store monitors.
6. Sharpening promotions?Couponing and price promotions are expensive and often harmful to a brand?s image. Thanks to better data, some companies are using fewer, more effective promotions. One promising approach: aiming coupons at a competitor?s customers.
7. Working with retailers?Consumer-goods manufacturers must learn to ?micro market? to the retail trade, too.
Pricing has traditionally been considered a me-too variable in marketing strategy. Customer Information Needed for Pricing Strategy.
1. The customer?s value analysis of the product: performance, utility, profit-rendering potential, quality, etc.
2. Market acceptance level: the price level of acceptance in each major market, including the influence of substitutes.
3. The price the market expects and the differences in different markets.
4. Price stability.
5. The product?s S curve and its present position on it.
6. Seasonal and cyclical characteristics of the industry.
7. The economic conditions now and during the next few periods.
8. The anticipated effect of recessions; the effect of price change on demand in a declining market (e.g., very little with luxury items).
9. Customer relations.
10. Channel relations and channel costs to figure in calculations.
11. The markup at each channel level (company versus intermediary costs).
12. Advertising and promotion requirements and costs.
14. The product differentiation that is necessary.
15. Existing industry customs and reaction of the industry.
When you market your baby products business you also have to use different pricing strategies. Demand analysis involves predicting the relationship between price level and demand while considering the effects of other variables on demand. The relationship between price and demand is called elasticity of demand or sensitivity of price. Elasticity of demand refers to the number of units of a product that would be demanded at different prices. Price sensitivity should be considered at two different levels: total industry price sensitivity and price sensitivity for a particular firm. Skimming pricing is the strategy of establishing a high initial price for your baby product with a view to ?skimming the cream off the market? at the upper end of the demand curve. It is accompanied by heavy expenditure on promotion. A skimming strategy may be recommended when the nature of demand is uncertain, when your baby products business has expended large sums of money on research and development for a new product, when the competition is expected to develop and market a similar product in the near future, or when the product is so innovative that the market is expected to mature very slowly.
Penetration pricing is the strategy of entering the market with a low initial price so that a greater share of the market can be captured. The penetration strategy is used when an elite market does not exist and demand seems to be elastic over the entire demand curve, even during early stages of product introduction. High price elasticity of demand is probably the most important reason for adopting a penetration strategy. The penetration strategy is also used to discourage competitors from entering the market.
The strategy of maintaining price is appropriate in circumstances where a price change may be desirable, but the magnitude of change is indeterminable. If the reaction of your customers and competitors to a price change cannot be predicted, maintaining the present price level may be appropriate. Alternatively, a price change may have an impact on your baby product image or sales of other products in your baby products business line it is not practical to assess. There are three main reasons for lowering prices. First, as a defensive strategy, prices may be cut in response to competition. A second reason for lowering prices is offensive in nature. The third and final reason for price cutting may be a response to customer need. If low prices are a prerequisite for inducing the market to grow, customer need may then become the pivot of a marketing strategy, all other aspects of the marketing mix being developed accordingly. An increase in price may be implemented for various reasons. First, in an inflationary economy, prices may need to be adjusted upward in order to maintain profitability.
During periods of inflation, all types of costs go up, and to maintain adequate profits, an increase in price becomes necessary. How much the price should be increased is a matter of strategy that varies from case to case. Price may also be increased by downsizing package size while maintaining price. In a recession, downsizing helps hold the line on prices despite rising costs. Under inflationary conditions, downsizing provides a way of keeping prices from rising beyond psychological barriers. Prices may also be increased when your baby products business has a monopolistic control over the market segments it serves. In other words, when a brand has a differential advantage over competing brands in the market, it may take advantage of its unique position, increasing its price to maximize its benefits. Such a differential advantage may be real or may exist just in the mind of the consumer. In seeking a price increase in a monopolistic situation, the increase should be such that your customers will absorb it and still remain loyal to the brand. If the price increase is abnormal, differential advantage may be lost, and the customer will choose a brand based on price.
Book Recommended for more in depth knowledge
Related directory categories
Slings And Carriers
Baby Skin Care
Child Safety Products
Baby Shower Gifts And Favors
Child Trust Fund
Child Learning Systems
Children Play Center
Marketing And Advertising
Related business articles
Basics Of Business Marketing And Advertising
Promoting Gifts Business
Promoting Real Estate Business
Promoting Web Hosting Business
Promoting Fashion Accessories Business
Promoting Web Design Business
Marketing Of Sports Products Business
Guide To Market Your Pet Supplies Business
Marketing Of Office Stationery Business
Guide To Market Your Toys Business
Guide To Market Your Promotional Products Business
Guide To Market Your Home And Garden Products Business
Marketing Of Personal Care Products Business
Marketing Of Security Products Business
Promoting Arts And Crafts Business