New Product Marketing: Need Help In Marketing A New Product? Publicity Can Be A Profitable New Product Marketing Strategy

Publicity is the most cost effective way to launch your company’s latest new product regardless of whether you plan to market your new product on a local, national or international scale.

With publicity, you can introduce a new product to thousands, even millions of people literally overnight and gain valuable new product marketing research in the process.

IMA defines publicity as mass communication with potential customers through the media. Publicity is the process by which your company’s new product marketing “sales pitch” is transformed into an editorial format or news.

Editorial coverage of new product marketing launches can take many forms, but the most profitable type usually occurs in print media such as newspapers and magazines.

Print publicity has a “shelf life,” – the printed word can reach and convert readers into buyers for weeks, months, and even years after publication. Conversely, two minutes of radio or television editorial coverage – once it has aired – disappears forever with its power to reach and convert the listening or viewing audience into buyers.

Print media can also be targeted to “vertical markets” or homogeneous audiences, which is a requisite for a new product marketing campaign to produce profitable results. Radio and television traditionally reach a “horizontal” consumer audience with broad unrelated interests which decreases the strength of your message and its probability for success.

Publicity and advertising are often confused with each other. You have to pay hefty prices for advertising space; whereas, the space publicity appears in is free. Publicity is perceived more favorably than advertising because the availability of advertising space is virtually unlimited and thus worth less – anybody can buy an ad and market their new product.

Publicity, on the other hand, always occupies an independent third party’s – the media – limited space for newsworthy topics. The catch? Getting publicity requires knowing how to convince the press your new product marketing launch is actually newsworthy.

Although publicity is free, there are much less quantities of it available. Publicity’s scarcity makes it considerably more valuable than advertising.

The result? An inch of publicity is worth a foot of paid advertising.

In advanced cases, publicity can be used to win public opinion and major economic victory for your company. At a minimum it can generate new interest in your company and sales of your new product.

IMA has generated over one thousand local, national and international placements -news stories – for our clients new product marketing campaigns over the last decade – reaching tens of millions of people and producing millions of dollars in sales.

Make publicity an integral part of your new product marketing processes and you too can generate buyers for your new product overnight.

How to Set or Get the Right Prices …

Which feature of your product does EVERY buyer ask about? Which sales tool is your best closing device? Which feature immediately differentiates you from your competitors? You guessed it, your price.

Yet, I’m always a bit surprised at how little time businesses spend on their pricing. Since this is a key marketing variable for any small business owner, here are some thoughts on setting (and getting) the right prices.

Price is a promise

Let’s say you are grocery shopping, and you come across two brands of cereal. One is a well-known brand of flakes that comes packaged in a 20 oz. box, contains a toy and is priced at $4.99. The other is a store brand of flakes, packaged in a non-resealable plastic bag and sells for $2.99. Which one would you buy?

If you based your purchase decision on price alone, you’d pick the 28 bag for $2.99 and be on your way. But there’s more to price than just that, isn’t there? There are the promises involved. In this example, the $4.99 brand promises you the highest quality ingredients and taste, an extra toy that could occupy your kid while you watch reruns of The Dick Van Dyke Show, plus the convenience of a re-sealable package.

Although this example deals with cereal, similar decisions are made by buyers in your market. Each time a buyer chooses a product, they match up a price with its promises. So, as the marketer of a small business, it is your job to understand what are the price and promises for your service.

Determine your promises

As you set your prices (or consider raising them), take stock of all the value factors that go into your price. What attributes of your product or service are noteworthy? Below are some examples of value factors that go into a product’s or a service’s price:

For a product:

• Quality of the raw materials
• Finished product performance
• Packaging
• On-time delivery
• After-sale service

For a service:

• Experience level of the service provider
• Bottom-line impact of the final deliverable
• Appearance of the service provider
• Turnaround time on phone calls/emails
• Ability to meet deadlines

As you can imagine, your ability to deliver various factors, over and above your competitors, directly impacts the prices you set…and get. If you promise certain factors, yet fall short on delivering them, your price will be challenged through customer complaints, delayed payments or customer defections.

Pricing Strategies for Small Business

The pricing strategy of your small business can ultimately determine your fate. Small business owners can ensure profitability and longevity by paying close attention to their pricing strategy.

Commonly, in business plans I’ve reviewed, the pricing strategy has been to be the lowest price provider in the market. This approach comes from taking a quick view of competitors and assuming you can win business by having the lowest price.

Lowest Pricing Does Not Win

Having the lowest price is not a strong position for small business. Larger competitors with deep pockets and the ability to have lower operating costs will destroy any small business trying to compete on price alone. Avoiding the low price strategy starts with looking at the demand in the market by examining three factors:

1. Competitive Analysis: Don’t just look at your competitor’s pricing. Look at the whole package they offer. Are they serving price-conscious consumers or the affluent group? What are the value-added services if any?

2. Ceiling Price: The ceiling price is the highest price the market will bear. Survey experts and customers to determine pricing limits. The highest price in the market may not be the ceiling price.

3. Price Elasticity: If the demand for your product or service is less elastic, you can then have a higher ceiling on prices. Low elastic demand depends on limited competitors, buyer’s perception of quality, and consumers not habituated to looking for the lowest price in your industry.

Once you understand the demand structure in your industry, review your costs and profit goals as set in your business plan or financials. The low price strategy is best avoided by small business but there are conditions such as a price war that can drag a company into the lowest price battle.

Avoiding a Price War

A price war can wreck havoc in any industry and leave many businesses, out of business. In the early 90’s, I observed the competitive exercise equipment market enter a price war in a large city market. Profits were plentiful but a price war took the gross margins from 42% to 12%. In less than 18 months, over 60% of the retailers were out of business while my division went national. Take these tips to evade a deadly price war:

Enhance Exclusivity: Products or services that are exclusive to your business provide protection from falling prices.

Drop High Maintenance Goods: There may be products or services in your business that have high customer service and maintenance costs. Drop the unprofitable lines and find out what customers don’t want.

Value-added: Find value your business can add to stand out in the marketplace. Be the most unique business in the category.

Branding: Develop your brand name in the market. Brand name businesses can always stand strong in a price war. Leave the price-cutting and price wars to big business. Small businesses with solid pricing strategies can escape a price war and low price position. Carefully, consider your price decisions. Your business depends on it.

Marketing strategy

A marketing strategy is a process that can allow an organization to concentrate its (always limited) resources on the greatest opportunities to increase sales and achieve a sustainable competitive advantage.

Types of strategies

Every marketing strategy is unique, but if we abstract from the individualizing details, each can be reduced into a generic marketing strategy. There are a number of ways of categorizing these generic strategies. A brief description of the most common categorizing schemes is presented below:

• Strategies based on market dominance – In this scheme, firms are classified based on their market share or dominance of an industry. Typically there are three types of market dominance strategies:
  • Leader
  • Challenger
  • Follower

psycological

• Porter generic strategies strategy on the dimensions of strategic scope and strategic strength. Strategic scope refers to the market penetration while strategic strength refers to the firm’s sustainable competitive advantage.
  • Cost leadership
  • Product differentiation
  • Market segmentation
• Innovation strategies – This deals with the firm’s rate of the new product development and business model innovation. It asks whether the company is on the cutting edge of technology and business innovation. There are three types:
  • Pioneers
  • Close followers
  • Late followers
• Growth strategies – In this scheme we ask the question, “How should the firm grow?”. There are a number of different ways of answering that question, but the most common gives four answers:
  • Horizontal integration
  • Vertical integration
  • Diversification
  • Intensification

A more detailed schemes uses the categories:

• Prospector
• Analyzer
• Defender
• Reactor

• Marketing warfare strategies|Warfare based strategies- This scheme draws parallels between marketing strategies and military strategies.

Marketing Mix

What is the marketing mix?

The marketing mix is probably the most famous marketing term. Its elements are the basic, tactical components of a marketing plan. Also known as the Four P’s, the marketing mix elements are price, place, product and promotion Read on for more details on the marketing mix . The offer you make to you customer can be altered by varying the mix elements. So for a high profile brand, increase the focus on promotion and desensitize the weight given to price. Another way to think about the marketing mix is to use the image of an artist’s palette. The marketer mixes the prime colours (mix elements) in different quantities to deliver a particular final colour. Every hand painted picture is original in some way, as is every marketing mix.

Price

There are many ways to price a product. Let’s have a look at some of them and try to understand the best policy/strategy in various situations

Place

Another element of Neil H.Borden’s Marketing Mix is Place. Place is also known as channel, distribution, or intermediary. It is the mechanism through which goods and/or services are moved from the manufacturer/ service provider to the user or consumer.

Product

For many a product is simply the tangible, phsysical entity that they may be buying or selling. You buy a new car and that’s the product – simple! Or maybe not. When you buy a car, is the product more complex than you first thought?

Promotion

Another one of the 4P’s is promotion. This includes all of the tools available to the marketer for ‘marketing communication’. As with Neil H.Borden’s marketing mix, marketing communications has its own ‘promotions mix.’ Think of it like a cake mix, the basic ingredients are always the same. However if you vary the amounts of one of the ingredients, the final outcome is different.

What is Marketing?

Most people think that marketing is only about the advertising and/or personal selling of goods and services. Advertising and selling, however, are just two of the many marketing activities.

In general, marketing activities are all those associated with identifying the particular wants and needs of a target market of customers, and then going about satisfying those customers better than the competitors. This involves doing market research on customers, analyzing their needs, and then making strategic decisions about product design, pricing, promotion and distribution.

In other words, the five categories listed on the MOTI home page represent the broad scope of marketing.

This view is consistent with the following definition of marketing found in a popular marketing textbook:

“Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, services, organizations, and events to create and maintain relationships that will satisfy individual and organizational objectives.”

-Contemporary Marketing Wired (1998) by Boone and Kurtz. Dryden Press.