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Product Marketing Strategy Toolkit

This toolkit begins by setting out that all businesses orient themselves toward the marketplace using one of four concepts or approaches:

  1. The production concept: “Make it and it will sell”
  2. The product concept: “Make it well and it will sell”
  3. The selling concept: “Promote it well and it will sell”
  4. The marketing concept: “Make something the market values and it will sell”

It further notes that these four concepts have been used by businesses in most industries over time. Movement from one to the next has typically (but not always) been linear, with the industry passing through each phase before moving to the next. The microfinance industry is similar to other industries in this respect, as it has moved over time from a production concept (in which MFIs aimed to produce as many affordable group loans as possible by replicating a blueprint of what had been successful elsewhere) to a product concept (in which MFIs sought to improve the quality of the product they were offering) to a selling concept (in which MFIs focused on selling their “new and improved” but still rather narrow range of products to an essentially homogenous market). Slowly but surely, however, an increasing number of MFIs are adopting the marketing concept and orienting themselves not towards production or products or sales, but rather, towards particular target markets. They are adopting a more demand-driven, client-oriented approach.

It is also highlighted that there are certain aspects that make marketing financial services more specialised. It is argued that because microfinance institutions sell financial services, their product marketing strategy will be greatly influenced by four characteristics common to all services: intangibility, inseparability, variability, and perishability. In addition, because the products being sold are financial services, there are two other distinguishing characteristics that should be taken into account, high involvement and loyalty.

The product marketing process can be divided into two parts. The first part aims to develop valuable products, while the second half aims to communicate that value to the market. This toolkit is designed to guide you through both parts of the process and to assist you in creating a product marketing plan that summarises your overall product marketing strategy and guides you in its implementation.

The toolkit is divided into nine sections, each of which explores one step of the process. Not surprisingly, the first step is for you to identify who your market is, what that market needs, and what it values. The second step is to examine your existing products to see how effectively they meet market needs. Based on the results of your research, you can then define your target market and your overall product strategy (step 3) and begin developing, differentiating and pricing products so that they have value to both your customers and to you (steps 4 and 5). Once you’ve developed a valuable product, you must prepare your marketing messages (step 6) and then deliver those messages through an effective marketing communications mix (step 7). The results of all seven steps are then brought together to form the marketing plan (step 8). Last but not least, the overall product strategy must be monitored and managed (step 9).

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