When you buy a new pair of Nike running shoes you’re paying costs ranging from t

Question

When you buy a new pair of Nike running shoes you’re paying costs ranging from the raw materials, production costs, import duty, and selling costs. Almost everything you buy includes a selling cost component which exceeds one-half of the total costs. Your clothing, food, DVD’s, and your textbook for this course cost more to sell than they cost to produce. Describe how firms differentiate their product designing and developing features, and marketing and advertising strategies to ensure buyers value the differences in their products from those of their competitors’ products. This is based on your opinion.

Explanation / Answer

Before manufacturing any product, manufacturers identify the demand as well as connected target customers with that demand. Further, issues or needs assessment of that particular target customer is done. Afterwards, a product is manufactured that is promoted to resolve the issues faced by the target customer. Here, the most differentiating factor is the correct need analysis and offering products that can fulfill the need. Using a suitable marketing communication, product is offered to them. In return, customers value the products due to its differentiating features and buy. Here, the role of positing and brand value of the product as well as the manufacturer is very important. Due to proper positioning, customers find themselves associated with the brand and they don’t look at the competitors.

It can be best understood by the example of toothpaste product. It is a well known fact that teeth of many people are sensitive in nature w.r.t. cold and hot products. After assessing the issue related to this, manufacturers have come up with specific toothpaste that controls sensitivity problems and product is offered to those customers who are suffering from it. Here, use of promotional strategy that not only highlights the problem of consumers, but also the solutions offered by the latest product. It attracts consumers who are suffering from sensitivity problem and buy it with a feeling of great value. Proper positioning with good quality helps manufacturers to retain the customer in this scenario.

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