Chapter16

Chapter16 - MANAGERIAL ECONOMICS An Analysis of Business...

Info iconThis preview shows pages 1–9. Sign up to view the full content.

View Full Document Right Arrow Icon
1 MANAGERIAL ECONOMICS An Analysis of Business Issues Howard Davies and Pun-Lee Lam Published by FT Prentice Hall
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
2 Chapter 16: Non-price Competition and the Marketing Mix
Background image of page 2
3 At the end of this lecture you should be able to: 1 . Use a simple economic model to explain the need for a properly balanced MARKETING MIX 2. Extend the formal economic model of the firm to include marketing variables 3. Evaluate the ‘rules-of-thumb’ which are used by firms to set their marketing budgets 4. Apply basic economic concepts to: product characteristics; the promotional mix; the product mix
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
4 The Marketing Mix What are the 4 ‘P’s of the MARKETING MIX?
Background image of page 4
5 The Marketing Mix What are the 4 ‘P’s of the MARKETING MIX? Product, Price, Promotion, Place
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
6 What Does Simple Economic Thinking Tell Us About the Optimal Marketing Mix? The optimal marketing mix is where the contribution from an additional $ spent on each aspect of the marketing mix is ; equal to each other equal to zero d$/d(price) = d$/d(product) = d$/d(promotion) = d$/d(place) = 0 WHY?
Background image of page 6
7 What Does Simple Economic Thinking Tell Us About the Optimal Marketing Mix? The optimal marketing mix is where the contribution from an additional $ spent on each aspect of the marketing mix is ; equal to each other equal to zero d$/d(price) = d$/d(product) = d$/d(promotion) = d$/d(place) = 0 WHY? Because in any other situation it would be possible to increase profit by either shifting spending from one aspect of the mix to another, or by increasing total spending
Background image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
8 Extending the Profit-Maximising Model We can include Advertising and Promotion expenditure (or any other spending designed to increase demand) by re-writing the model as follows:
Background image of page 8
Image of page 9
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 19

Chapter16 - MANAGERIAL ECONOMICS An Analysis of Business...

This preview shows document pages 1 - 9. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online