Product and Marketing

Last week you received some advice from an experienced engineering manager about estimating a ‘minimum’ selling price for your product. You have done some research and you feel reasonably confident about estimating this figure. However his final words to you have given you food for thought.

“Remember that in the real world, selling price bears no relation to production cost, it is the market that ultimately sets the price it is prepared to pay for a product.” (A Lamming)

You decide to pay him another visit.

You I understand what you are saying, but how can I find out what the market is prepared to pay?

Manager As I said, it’s the market that decides how much you can sell your product for. If you can’t sell above minimum price, and sell enough, then there is no point in being in the business. Have you done any market research?

You Well, err, no. I’m not really sure where to start.

Manager It’s all about customer needs and their perception of your product. It’s also about customer numbers and finding ways of getting them to want your product. In the longer term you need to think about product life-cycle. I think one of the first things you should do is find out about the five P’s.
Learning Outcomes

Following this PBL cycle you should be able to:

o Discuss the significance of Market Research.
o Outline various methods of market research and assess their relevance to your enterprise.
o Explain how pricing affects customers’ perception of your product.
o Explain how pricing affects sales and consequently profits.
o Explain the significance and application of the five P’s in the context of marketing.

Resources

Library Catalogue

Small Business Guides
How to start and run your own Business etc
Marketing and Sales etc

Internet
www.startinbusiness.co.uk
www.bbc.co.uk/learning/subjects/business_studies.shtml
http://news.bbc.co.uk/1/hi/business/
www.businesslink.gov.uk/bdotg/action/home?&domain=www.businesslink.gov.uk
www.smallbusiness.co.uk
www.startups.co.uk

Product and Marketing

Last week you received some advice from an experienced engineering manager about estimating a ‘minimum’ selling price for your product. You have done some research and you feel reasonably confident about estimating this figure. However his final words to you have given you food for thought.

“Remember that in the real world, selling price bears no relation to production cost, it is the market that ultimately sets the price it is prepared to pay for a product.” (A Lamming)

You decide to pay him another visit.

You I understand what you are saying, but how can I find out what the market is prepared to pay?

Manager As I said, it’s the market that decides how much you can sell your product for. If you can’t sell above minimum price, and sell enough, then there is no point in being in the business. Have you done any market research?

You Well, err, no. I’m not really sure where to start.

Manager It’s all about customer needs and their perception of your product. It’s also about customer numbers and finding ways of getting them to want your product. In the longer term you need to think about product life-cycle. I think one of the first things you should do is find out about the five P’s.
Learning Outcomes

Following this PBL cycle you should be able to:

o Discuss the significance of Market Research.
o Outline various methods of market research and assess their relevance to your enterprise.
o Explain how pricing affects customers’ perception of your product.
o Explain how pricing affects sales and consequently profits.
o Explain the significance and application of the five P’s in the context of marketing.

Resources

Library Catalogue

Small Business Guides
How to start and run your own Business etc
Marketing and Sales etc

Internet
www.startinbusiness.co.uk
www.bbc.co.uk/learning/subjects/business_studies.shtml
http://news.bbc.co.uk/1/hi/business/
www.businesslink.gov.uk/bdotg/action/home?&domain=www.businesslink.gov.uk
www.smallbusiness.co.uk
www.startups.co.uk

Product and Marketing

Last week you received some advice from an experienced engineering manager about estimating a ‘minimum’ selling price for your product. You have done some research and you feel reasonably confident about estimating this figure. However his final words to you have given you food for thought.

“Remember that in the real world, selling price bears no relation to production cost, it is the market that ultimately sets the price it is prepared to pay for a product.” (A Lamming)

You decide to pay him another visit.

You I understand what you are saying, but how can I find out what the market is prepared to pay?

Manager As I said, it’s the market that decides how much you can sell your product for. If you can’t sell above minimum price, and sell enough, then there is no point in being in the business. Have you done any market research?

You Well, err, no. I’m not really sure where to start.

Manager It’s all about customer needs and their perception of your product. It’s also about customer numbers and finding ways of getting them to want your product. In the longer term you need to think about product life-cycle. I think one of the first things you should do is find out about the five P’s.
Learning Outcomes

Following this PBL cycle you should be able to:

o Discuss the significance of Market Research.
o Outline various methods of market research and assess their relevance to your enterprise.
o Explain how pricing affects customers’ perception of your product.
o Explain how pricing affects sales and consequently profits.
o Explain the significance and application of the five P’s in the context of marketing.

Resources

Library Catalogue

Small Business Guides
How to start and run your own Business etc
Marketing and Sales etc

Internet
www.startinbusiness.co.uk
www.bbc.co.uk/learning/subjects/business_studies.shtml
http://news.bbc.co.uk/1/hi/business/
www.businesslink.gov.uk/bdotg/action/home?&domain=www.businesslink.gov.uk
www.smallbusiness.co.uk
www.startups.co.uk