Page 13 - OCS Workbook - Day 2 Suggested Solutions (May 2018)

SUGGESTED SOLUTIONS

EXERCISE THREE
(MARKETING)

Briefing Notes
The marketing mix

The marketing mix is used to identify what attributes of the product meet the needs of the
consumer and what is valued by the customer. For products it is normally split into four
categories known as the four P’s - Product, Price, Place and Promotion.

Product
This relates to the attributes of the physical products themselves, including the quality of the
leather used to make our handbags and the durability of our merchandise (not just the leather
itself, but also the zips and buckles, etc). These are the attributes that are valued by the end
consumer. The ‘Made in Lowerland’ label, sewn into each item, is seen as a badge of quality for
the company’s products.
However, there are other aspects such as how on-trend our handbags are and whether they are
ecologically sustainable. If we want the customer to purchase products from us rather than a
competitor it is important to understand what the customer actually wants from the product.

For example, extending the range of bags by introducing new sizes only makes sense if this is an
attribute valued by customers.

Moving forward, Mansako can look to expand into other products within the personal luxury
goods market, such as clothes and shoes, jewellery, fragrances etc. We can also, of course,
continue to introduce new handbag designs and variations on old designs.

Price
Price relates not only to how much the product costs to buy but also to things like discounts and
credit terms etc.
Mansako’s customers are aspirational consumers seeking to trade-up from the mid-priced goods
range, but are still either unable to afford, or do not want, to pay the significantly higher price
tags that high-end luxury commands. In terms of market positioning, we fall between the higher
priced French and Italian luxury brands and the lower priced American designer brands in terms
of our price point. Our customers are seeking value for money whilst simultaneously seeking a
higher quality of life.
Price positioning is crucial particularly in a market where digital channels provide consumers with
constant information on product characteristics and price transparency.
Moving forward, if Mansako decides to enter new geographical markets or product markets, an
idea would be to enter with full-price product penetration in order to protect the brand and
increase margins.
And then we have our discount outlet sales which experienced a sizeable growth in 2017. It is
important to set our off-price sales at the correct level so that the buyer feels it is worthwhile
whilst not degrading the profit margin to an unacceptable level.

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