DEMARKETING

KISHORE .T.SMSNIMT

Definition of demarketing

Kotler and Levy define demarketing as “discouraging customers in general or a certain class of customers in particular on either a temporary or a permanent basis”.

Meaning

Demarketing basically refers to when a company discourage its customers to buy the product produced by them.

Its because of shortage of supplywant to promote their other products and the company is not

having so much profit with the sale of that product.

Examples

This happened in case of Tata Nano, when the demand for Tata Nano increased from its supply level then Tata started promoting their other products and completely stopped the promotion of Tata Nano.

When Maruti A-star was launched, for the promotion of A-star Maruti started discoursing its customers to buy Maruti Xtilo.

4p’s of demarketingRemove warranty

Remove accessories  Increase price.

Restrict availability. Cut down on advertising.

Different forms of demarketing

Demarketing can be three forms:

1. General Demarketing

2. Selective Demarketing

3. Ostensible Demarketing

1. General Demarketing

To reduce demand in general. General demarketing is used when a firm (or government) wants to demarket to everyone. General demarketing is required when a company wants to shrink the level of total demand.

Example: the government demarkets cigarettes and alcohol (discouraged goods) and illegal drugs (a banned good)

2. Selective Demarketing

Here a target set of consumers are discouraged from purchases. It is to protect the core/loyal customers.

Example: A landlord might demarket its property to a group of students if he prefers family for rent purposes.

3. Ostensible Demarketing

Occurs when a seller creates an artificial or perceived shortage to whet consumer appetites.

Limited distribution of goods may induce consumers to stockpile these “hard-to-get” items.

Example : BMW announced in 1997 that it was having to restrict supply to the UK market

Demarketing strategies 

Can be categorized as

1. Passive de-marketing

2. Active de-marketing

3. Complete de-marketing

1. Passive de-marketing

Here only consumers unaffected by demarketing program continue to use the product.

Example: Warning on cigarettes and highlighting harmful of cigarettes on health comes under purview of passive demarketing

2. Active de-marketing 

It uses the marketing mix to decrease demand in several or every market segment.

Example: Regulating prices to reduce consumption of products

3. Complete de-marketing

It ceases sales of the product.

Example: Recall of products from market in case of unsuitability to the market.