Usually, companies sell their product and in order to understand and reach the customer target segment, they need engage themselves in marketing.
However, there can be times, when the opposite of what has been stated needs to be accomplished. The popularity of the product needs to be brought down or the sales needs to be reduced or the product needs to be wiped off from the market completely. Application of marketing ideas and principles to achieve these objectives can be termed as 'Demarketing'.
Demarketing can be majorly classified into two types.
1. General Demarketing
Companies engage in this kind of Demarketing in order to reduce the consumption of a product. Sometimes company tries to reduce the sales in a particular region. An example, when this might be required can be, when the sales units of one particular region needs to be diverted to another region where the company feels the product would be more profitable. So the company engages in demarketing practices to reduce the sales in the low profit region.We often see government agencies engaging in Demarketing to reduce the popularity of certain products such as cigarettes, alcohol etc. These advertisements are not targeted at a particular brand but generally try to reduce the overall consumption of the product type.
An Indian example could be the 'Save Oil Save India' campaign by IPCL.
2. Selective Demarketing
Companies generally target a specific kind of people for their products. They try to avoid consumers who do not form a part of this target group. A consumer from another target group could often lead to brand dilution of the product and the product might loose its dominance in the core target group. This is achieved by promoting the products through advertisements, word of mouth etc. which focuses only on their target group.
Ex. Ibiza, a popular tourist destination for youth, tries to avoid elderly people. Adventure sport advertisements generally show young adults engaging in the sport. Insurance companies try to avoid costly customers. They screen their potential customer base through several criterias and questionnaires and avoid certain type of customers.
How Can Demarketing Be Exercised ?
Based on the level of demarketing which needs to be accomplished, the companies can fiddle with the marketing mix of their product and achieve the level of demarketing which they intend to.
A. Product
They can modify the product features. By reducing certain features, the benefit derived out of the product would be reduced and this would immediately have an impact on the sales.
B. Price
They can increase the price of the product and make it dearer. An expensive product would find few takers. The level of price change would determine the extent of reduction in sales.
C. Place
The product can be completely taken off from the market. This could be done, if the company wants to kill the product completely. It is also done, if the company determines that the product fails to live upto the quality standards. Several instances have occurred in the past with pharmaceutical companies having been forced to remove their products off the shelves because they were causing certain side-effects.
D. Promotion
This can be done in two ways. One is by cutting the promotion completely. This would be done by cutting on sales promotion, advertising expenses etc. The other is by encouraging the consumers to not to use the product. An example of this could be 'PETA' advertisements which encourage people not to use certain products which have been produced by bringing upon atrocities on the animal kingdom.
However, there can be times, when the opposite of what has been stated needs to be accomplished. The popularity of the product needs to be brought down or the sales needs to be reduced or the product needs to be wiped off from the market completely. Application of marketing ideas and principles to achieve these objectives can be termed as 'Demarketing'.
Demarketing can be majorly classified into two types.
1. General Demarketing
Companies engage in this kind of Demarketing in order to reduce the consumption of a product. Sometimes company tries to reduce the sales in a particular region. An example, when this might be required can be, when the sales units of one particular region needs to be diverted to another region where the company feels the product would be more profitable. So the company engages in demarketing practices to reduce the sales in the low profit region.We often see government agencies engaging in Demarketing to reduce the popularity of certain products such as cigarettes, alcohol etc. These advertisements are not targeted at a particular brand but generally try to reduce the overall consumption of the product type.
An Indian example could be the 'Save Oil Save India' campaign by IPCL.
2. Selective Demarketing
Companies generally target a specific kind of people for their products. They try to avoid consumers who do not form a part of this target group. A consumer from another target group could often lead to brand dilution of the product and the product might loose its dominance in the core target group. This is achieved by promoting the products through advertisements, word of mouth etc. which focuses only on their target group.
Ex. Ibiza, a popular tourist destination for youth, tries to avoid elderly people. Adventure sport advertisements generally show young adults engaging in the sport. Insurance companies try to avoid costly customers. They screen their potential customer base through several criterias and questionnaires and avoid certain type of customers.
How Can Demarketing Be Exercised ?
Based on the level of demarketing which needs to be accomplished, the companies can fiddle with the marketing mix of their product and achieve the level of demarketing which they intend to.
A. Product
They can modify the product features. By reducing certain features, the benefit derived out of the product would be reduced and this would immediately have an impact on the sales.
B. Price
They can increase the price of the product and make it dearer. An expensive product would find few takers. The level of price change would determine the extent of reduction in sales.
C. Place
The product can be completely taken off from the market. This could be done, if the company wants to kill the product completely. It is also done, if the company determines that the product fails to live upto the quality standards. Several instances have occurred in the past with pharmaceutical companies having been forced to remove their products off the shelves because they were causing certain side-effects.
D. Promotion
This can be done in two ways. One is by cutting the promotion completely. This would be done by cutting on sales promotion, advertising expenses etc. The other is by encouraging the consumers to not to use the product. An example of this could be 'PETA' advertisements which encourage people not to use certain products which have been produced by bringing upon atrocities on the animal kingdom.
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