It is debatable whether the first or the second in the market makes the most profit. Often the first signposts the way, allowing the second to learn from the other's mistakes. It is often expensive to be the trail-blazer. It all depends on how ready the consumer is to take up the offering.
Film cameras have almost been replaced by digital, but the product life was extended by Fuji inventing the use-once camera. A professional photographer friend of mine gave every guest a disposable camera at his wedding, and the results were amazing and enlightening: good thinking by Fuji. Relaxing Sunday trading laws has exacerbated the decline of city centre trading and the traditional small shopkeeper. They have to decide whether to open even longer hours, become more specialised or find gaps in the market that the multinationals are ignoring.
Businesses committed to innovation will survive, but it takes an agile mind and resources to keep ahead. Your range of products and services must continue to be seen to offer more benefits than your rivals'. Effective product management entails keeping a close eye on the profit contribution that each line makes. Don't be fooled by overall profitability. Examine each line sold and form a judgement. Long-range plans should always be updated to keep a strategic view on where the business is going. We live in a changing world. Attending your trade show, reading the magazines, and asking your customers should all be mandatory.
A service trade could emulate one florist I have helped. I suggested putting a reply-paid card in each arrangement that was posted. The recipient was only too pleased to respond, appreciating that the supplier had not drawn a line when the goods left the shop. Apart from checking on delivery times by the carrier, it reassured the customer that the florist cared about the service - and it also brought extra business.
The staff suggestion box may be a joke in some businesses, but it shouldn't be. Honda has an entire shadow factory set aside for staff to engineer new products that may have no connection with motors. Asking staff for improvements or ideas should be part of the activities of every progressive firm. Involve everyone and carry them with you.
The concept of marketing can be broken down into four variables - the product, price, place and promotion (the four Ps). Getting the right balance (mix) of these will create the best appeal to the customer. It is 'the means by which a firm defines and supports the competitive position it seeks to occupy in the target market'.
Price in these terms should not be taken too literally, as we should all realise that value is far more important. The way that this is presented to the consumer will largely determine the success of the enterprise. A price cut could well reduce sales for some quality goods, as we still often associate price with quality. In other words, the right goods in the wrong shops will sell less. The right goods at the wrong price, or poorly advertised, will also stick on the shelves.
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Note: This article was sent to us by: George F. Allister at 07152010
1. How to compile a sales forecast and conceive a marketing strategy
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