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F293 - Marketing - Mr Cullen
Transcript of F293 - Marketing - Mr Cullen
Marketing - January
1. Different laws and regulations. Laws even within EU differ from country to country so organizations must be aware of these to prevent expensive or embarrassing transgressions. Tobacco packaging is a good example of this (UK - Smoking Kills, AUstralia - Brandless/colourless)
Reasons for moving into an overseas market
Population/ Size of market - Larger markets are an obvious attraction. Perhaps the UK market has become saturated or all internal distribution channels are being used. Economies of scale can also be taken advantage.
Economic cycle - By operating in other markets that are at different points in the economic cycle risk is spread. For instance Australia has avoided recession during the financial crisis.
Consumer Law- Trading regulations are more stringent in MEDC's compared to NIC or LEDC countries. Tobacco advertising is a good example of this. Alcohol advertising during sporting events is banned in some european countries which has led to football clubs such as Liverpool having to play away fixtures without sponsorship on their kit.
Where are we now?
the process of communicating the value of a product or service to customers. It may also convey the overall strategy of promoting a product or service to the customer.
Differences in marketing overseas
Role of Marketing
Relationship of marketing to business decision making
Relationship of marketing to other departments
Methods of market research
Sources of information
Costs and benefits of market research
Quantitative analysis of market research results
Role of Marketing-
Relationship of marketing to business decision making
Relationship of marketing to other departments
Marketing plays an integral role in an organisations decision making process. This is partly due to breadth of it's role. The marketing department will have an input on the following aspects of a business:-
Distribution in conjunction with production/logistics.
Price to be discussed with production and finance.
Outsourcing of MR or advertising.
Human resources- Employee performance in the marketing department is dependent upon the morale and motivation of the workforce. This will influence whether the marketing department is able to meet its objectives. The ability to recruit effectively will also influence the marketing departments functionality. Do they have enough talent to complete the marketing process or do they need to outsource?
Finance - Budgetary constraints are placed upon the marketing department, as with all departments. This will everything from the number of employees to the amount of air time they can buy for an advertising campaign.
Production - is the production department in a position to meet an increase in demand if a large advertising campaign is undertaken? What is the break even point? Can the product be made using more environmentally friendly materials.
Logistics - distribution channels (Place). Is it possible to sell abroad? Can we effectively transport our products?
Legal department - Is an advert campaign legal - media guidelines.
2. Cultural differences - HSBC advert. Misunderstandings can occur from the wrong use of colour, wording and customs.
3. Political climate- Is the country stable (Egypt,Libya)? Will the state get involved in private business ventures (Russia)? Will laws based up religious expectations reduce an advertising campaigns effectiveness?
4. Religious and cultural differences. Alcohol cannot be drunk in public and the role of woman in society are examples of how the west differs to Muslim countries. This will therefore influence marketing in these countries,
5. Ways of doing business! A payment to the CEO to seal the deal is known as a bribe in the UK, whilst in other countries it is an expectation. BAE systems have fallen foul of this issue.
6. Domestic insight is often vital. Organization will often employee local experts to them an insight into what methods of marketing will be effective in a certain country. This maybe the case within the EU - Countries such as Spain and Italy have a siesta culture - very different to the UK.
7. LANGUAGE, IDIOMA, TAAL, TEANGA, IAITH. Even within the UK different languages can be found.
Words and therefore brand names can become offensive in different countries. See the photos ---------
Differences between markets
The following four factors must be considered before entering an overseas market. Thorough market research must be undertaken, this will be costly however this cost will pale compared to repercussions of failure having entered an overseas market.
Where do we want to be?
How will we get there?
Marketing audit and analysis of what marketing activities are currently taking place within the organization at this moment in time. This will include a SWOT analysis as to take into consideration external factors. This aspect is fundamental as it allows the organisation to measure its future performance, it's progress against the objectives set therefore whether it is on course to meet deadlines.
A strategy is developed to meet the objectives that have been set. The strategy will be made up of marketing tactics. These tactics will be chosen using the understanding gained from the audit. In most cases the strategy will include aspects of all 4 p's.
The marketing strategy will be drawn in conjunction with other departments such as the finance department (Set the budget) and the production department (capacity utilisation. )
Objective setting - There are two kinds of objectives. Corporate objectives which set out the direction of the entire organization and therefore are often broad, sweeping terms (Growth, increased profitability, diversify).
Below these will be departmental objectives which will work towards bringing about corporate objectives. These will be more precise, we are currently concerned with marketing. The marketing objectives may include increasing market share, become the market leader or launch into a different market.
Customers views not taken into consideration-
Can ignore other departments -
Future exogenous factors may leave a plan obsolete in a short space of time after its inception.
Size of business may not require such a time consuming document - opportunity cost.
Helps to justify spending and prevent wasted expenditure
The setting of objectives can motivate the workforce.
Prioritize projects so the finite amount of finance can be used in the most effective manner.
A plan allows an organization to assess performance in the context of what it hopes to achieve.
Number of enquiries
The most common and easily implemented by measuring if or by how much sales has increased as a result of a marketing plan.
How many hits does a website have during or post a marketing campaign.
Organizations are particularly interested in the market share they control. An organization will closely monitor this during a concerted advertising campaign
Sample a selection of customers to see if the service or good provided met their needs
Factors that are taken into consideration when putting a marketing strategy in place.
Size of Business
Nature of Market
Segmentation of market
social economic group - A/B/C.....
13B - Market research Brainstorm
Buy reports from market research companies
Newspapers and magazines
Numerical based due to it being objective.
Makes this easier/quicker which reduces the costs involved in analyzing it.
Whats the point.....
Why do we undertake market research - ultimate aim as with any aspect of marketing is to increase sales.
Survey - Questionnaires
Internal vs external sources
Opinion based means that it is harder to analyze.
Primary/ field research
Surveys - questionnaires
Mintel reports - market research company reports.
Company data - annual reports + loyalty card data
Objective - numerical based data.
Often quicker and less costly to analyze due to computers being able to be used.
This data can be generated by using closed questions.
Brainstorm market research 13 D
Opinions - Subjective information.
Harder to analyze/ more time consuming and therefore higher costs
Created by using open questions
Numerical based information. the advantage of this is that it allows organization to analyze vast sets of data quickly using computers. This is an advantage because it is relatively cost effective.
Closed questions provide this kind of data.
Subjective - Open questions which lead to consumers giving their OPINIONS!
This leads to the data taking longer to analyze due to labour being required. This leads to costs being higher.
Surveys - questoinnaire
Market research company reports - Mintel.
Historical data - loyalty cards, sales records.
13 A - Brainstorm - Market Research
Surveys - questionnaires
Reports from markets research company - Mintel.
Historical internal data.
Competitor information - company reports
Opinion - Subjective.
More costly to analyse due to labour costs. This is also time consuming.
The data could be describe as being rich in detail.
Objective - numerical based
Quicker and therefore lower cost analysis - big data. due to computer being used to analyse.
The sooner research is analysed the quicker it can be acted upon. This can be used as a form of competitive advantage.
Market research storm - 13C
Increase in competition - New entrants into the market provides consumers with more choice at different price points.
The market has become saturated and therefore sales of new products has declined. This is only relevant to durable goods such as cars or white goods.
Changing trends - the product may have come obsolete. fashionable trends - flares. Technological development - DVD - video.
PR disasters - Boycotts of goods related to scandals. GAP/NIKE in the early 90's re child labour. BP - oil spill- sales plummeted in Florida and adjoining states.
Climate change - seasons are no longer consistent making sales forcasts harder to create.
Natural disaster. - Nuclear power in Japan has all but finished due to the Tsunami.
Substantial and effective marketing campaign - certain campaigns grab the nations attention which sees a bounce in sales. Promotions are include within this. Celebrities may be used as apart of a marketing campaign.
Launch of new product or the rebranding of a product.
Competition can be reduced through competitors exiting the market or through acquisitions and mergers. (M&A).
Changing trends - Demographic changes - SAGA - Old people holidays and age specific car insurance.
Exogenous factors - a source of raw materials that leads to increased production, that may lead to costs benefits being passed onto consumers and therefore market share increasing.
Quality of product increases due to production changes. Skoda
Marque sponsorship of global event.
Increased distribution of product - Going from a small domestic market into national or international markets. Food products such as Copella fruit juice start in local markets and then graduate into national markets.
Scandals for competitors will lead to bad publicity reducing there sales and leading to demand of other organizations increasing.
Factors that could lead to a Growth in Market share -
Factors that could lead to a decline in Market Share
Market share Starter
Total Market sales
Kala furniture company LTD sells 200 sofas every month. In the Aldershot area 4,600 sofas are sold every year. KFC Ltd sell their sofa for an average price of £480. The market average is £550.
Calculate the market share in value and unit terms.
Identify target market. This allows companies to increase the accuracy if their advertising.
Identify trends - Market trends and national trends.
Is the market growing?
Is the organizations market share increasing and why?
200 X 12 = 2,400
2,400 X £480 =
4,600 X £ 550 =
Predicting the market
Competition - how will a new entrant impact upon issues such as price. MR in conjunction with formulas such as price elasticity of demand can aid an organization in understanding the impact new entrants will have upon market share, volume of products sold, total revenue and therefore the profit margins. An organisation can also use this information to better understand the barriers to entry of a market.
Q 1-4 pg 17
Then Q3 on Pg 17
Gives an understanding of how spread out data is in comparison to the mean.
This gives us an understanding of how close the data sets are to the average. A wide standard deviation such as 10 suggests that the data is not very reliable I.E no strong trend emerging. There are a number of reasons why this may have arose. One could be a small sample size.
Why learn SD?
Romans Perfect F293
250, 240, 245, 248, 260, 243, 246, 249, 249, 241
To reach a conclusion by reasoning.
Deduction or to Deduce
To reach conclusions using your own business knowledge in conjunction with the information from the case study
Where is it?
Socio economic groups use
Customer service is vital
In markets that are influenced by significant changes in demand on a seasonal basis the number of required employees may fluctuate. This demand can be met by short term temporary staff. This will be organised and influenced by HR on the behest of the marketing department.
The marketing department may have to consult the legal department before advertising campaigns are launched. This maybe related to pester power or other ethical concerns. International campaigns will have to check that other countries do not have specific rules regarding the selling of certain products. This is particularly true of alcohol, tobacco and sex related items. This maybe based on religious or cultural grounds.
Economies of scale
MR - temporary staff
MSL - Q4 - Steps of implication
Small population - due to cost restraints
Sampling problems such a poor implementation of a method or a poor choice of method (stratified/quota) create skewed/biased data. The severity of which is increased by the small population used as a part of the MR, this will have been due to the budget restraints placed upon Bex.Any decisions based upon this data such as discounting of products or the diversification into the limited mobility market could be incorrect. This would lead to poor decision making and the possibility of investing significantly into the new limited mobility product range with the prospect of making a small return or possibly a loss. Ultimately sampling errors would lead to an increase in costs as result of poor decisions being made and therefore put the profitability of MSL in jeopardy, due the lack of increased revenue.
Sampling problems = skewed data
Increases severity of poor data
Poor decision made
Increased costs with little return
Q5. AIDA stands for Attention, Interest, Desire and Action. The model provides Bache with a framework through which to structure its promotion and advertising of the new healthy confectionery. This may include bright packaging to draw attention to the new product, this will be important as competitors have been first to market and therefore it is vital that consumers are drawn to baches new product, Interest could be brought about by the use of slogan "get yours now". Desire could be brought about by highlighting the healthy credentials of the product such as having low sugar content. Introductory pricing could be highlighted in advertising encouraging the action of purchasing the healthy sweets. The positive impact this could have on baches is that the structure of the AIDA will encourage them to deliver promotions that will boost sales in volume leading to a pleasing market share and therefore a increasing sales revenue towards the 15% objective in the long term.
6 marks Q's
Mock Aida Q
F293 - January 2012 Q1,Q4 and Q6
Increase market share
Increase sales revenue
Diversification reduces the risk to the organisation and in light of a reduction in the core activities this could be the most appropriate time to undertake diversification as to make up for a loss in revenue.
Increase customer awareness in preparation for the upcoming surge in demand created by Derry-londonderry being the 2013 city of culture. The events assocaited with this event will lead to increased tourism and therefore demand for KCL. Increased customer awareness will allow KCL to take advanatge of this opportunity, which will result in increased sales revenue and contribute to them moving closer to achieveing thier mission statement of being the number one coach company Northern Ireland.
Link to case study - "mission statement is at the heart of everything we do"
Mission statement is to be the leading coach company in northern Ireland.
Pricing strategies - return journey 50 % off
Sponsorship - Take advantage of London-derry being the city of culture 2013.
PR - Charity work, local sports event?
Gifts - stag/hen dos - £50 bar tab? Scarfs for sporting events.
Define - promotion & sales volume
Aggressive promotion - using methods such as PR, sponsorship and pricing strategies to increase demand or the market share of a product or service.
Prep - 25/04/14
consider the other functions of business:
Finance - can KCL raise enough finance.
HR - Skills within the business to manage the diversififcation. Very few transferable skills. recruitment?
Operations-suppliers, hotel management.
Against - Opportunity cost - does this diversification aid the organization to achieve its mission statement.
Is it taking advantage of the opportunity presented by the Derry-londonderry being the cultural city of 2013. Could £1.5m be used in a marketing campaign to enhance its core activities and take advantage of the impending increase in demand as tourism will increase as the cultural shows start. taking advantage of this will bring them closer to achieving their mission statement. This is important Roberta states that the mission statement is at the heart of everything we do. Therefore this diversification goes against the strategic direction of the organization.
HR the disruption to the senior management team could lead to KCL's core activities suffering as the organization concentrates on integrating the hotel into the organization rather than seekinh to achieve the mission statement.
Reasons to diversify:
Finance - 4 years payback time on such a significant (1.5m) investment will aid the KCL in acquiring the finance from external sources. Banks for instance will be encouraged by this short payback period. Upon this this short period suggests that hotel is a profitable organization.
Marketing - with 70 % of hotel user being KCL customers already there will be marketing economies of scale to be taken advantage of. This is the case because the target market for the hotel will be similar demographically as well as socio economically. Therefore the rebranding of the hotel is able to take place without putting off existing customers. Upon this the promotional material for both aspects of the business will be aimed towards the same groups and leading to a symbiotic relationship in terms of marketing. This will therefore require less marketing spending compared to the two organizations working separately.
The remaining 30% of the hotel customers likely to be overseas tourists which is a benefit to KCL as this will reduce the exposure to the local economy. This will secure cash inflows and reduce reliance upon peak times such as school holidays.
HR - Hotel is an ongo
training in it1
Marketing strategy Question
Define what a strategy is...
Simple but effective structure would be to use the marketing mix (4p's).
In the introduction you can dismiss any P that may not be relevant due to the organizations context.
Methods of evaluation
Which of the "P's" will
the organizations future success or profitability.
Long term vs term often case studies mention objectives that the organisation is seeking to achieve. use this time frame as a method of suggesting which is most appropriate.
Available finance "it depends upon the amount of finance" different aspects of a strategy will be high or low cost. Highlight which should be chosen if a lot of finance is available and which should be used if there is little.
750-350 X 42 = 16,800
500-300 X 90 = 19,000
Question 1 F293 2012
Local demand in the off season
Socio economic group - A/B
Couples - small tables - pool suggests adults.
Demand low? - exclusive?
Travel agency - related business
Privately owned - LTD
Competitive market - James Villas, local hotels, Thomas cook - looking to poach from this group as their affluence increases. Internation competition - Italy, greece, spain, S France.
Target market - exclusive. Disposable income increased - empty nesters
Hotel - Tourism - luxury - increasing demand due to increased economic situation.
Med - Greece - spain , Italy.
European couples - Inc UK
Domestic demand for the restaurant.
USP - great views and romantic ambiance
Boat trips - local coastal tours - Watersports
Low cost airlines opened up competition across the EU
EU - Currency fluctuations - Euro v's £
Pricing strategy - premium during middle summer months. Discounting will take place late and early in the season.
Town near by to source goods and services.
Age - 37 - 65
Couples - pool is not child friendly.
restaurant is set up for couples rather than large groups.
Restaurant apart of the hotel.
Seasonal demand - Tourism - weather, School holidays. (Not relevant to this hotel)
Locals may use the restaurant providing revenue throughout the year. Cash flow issues reduced.
Not a town centre location - greater exclusivity.
USP - Location/view
Competition - Greece , Italy, Portugal, Spain, South of France
Low cost Airlines
Euro - currency fluctuations.
sOCIO ECONOMIC GROUPS - a,b,c1
Luxuries - High disposable income.
Boat tours - 50% off if staying in May
target market - socio- economic A,B
Couples Age 30-60
Some tour companies maybe in competition with this,
Local hiking tours. - Mountains.
Anti children - Pool - anti children - relatively dangerous - luxurious - romantic ambiance.
Populous area - domestic demand for the restaurant and employees likely to be local.
Seasonal demand - hotels due to the weather and school holidays. However this hotel will be insulated from the problems of seasonal demand because of its target market. The couples that are likely to use this hotel are not restricted by school holidays and therefore can take advantage of off peak flights.
Defining Advertising Goals
Measuring Advertising results
Have an understanding of what the campaign is trying to achieve.
Allow the campaign to measured against a certain criteria - SMART objective is required.
10% increase in sales revenue over the next 6 months
10% increase in units sold over the next 6 months
0.5% increase in market share in the next 5 months
Discuss the aim of the campaign - IE attention or differentiate the product from its competitors.
Advertising campaigns are a significant investment therefore an understanding of what works and what doesn't is key to ensure future success.
Market Research - key to bringing about an understanding of how your campaign has influenced the market.
Exogenous factors - those outside of the organizations control. Should be taken into consideration to ensure that the reasons success or failure are highlighted.
Its a tool used to ensure that a strategic view is taken of the advertising process. It allows mangers to justify the often significant financial investment, In the longer term it allows the organization to build up an idea of what aspects of advertising campaigns work and therefore could or should be repeated.
AHC - AIDA
AIDA (Attention, Interest, Desire and Action) is a four step promotional model that Andy could use to move potential customers from being unaware of the gym (Attention)through to purchasing a membership(Action). There is little active promotion of the gym at this moment in time however Andy should look to increase local awareness (Attention)of the gym. This could be done through a local billboard campaign which would highlight the location of the gym. To take advantage of this opportunity he could run a sales promotion (Half price for the first three months) alongside encouraging people to take up membership or advertise option A the monthly membership possibility. which would satisfy the "action" aspect of the AIDA model. Ultimately AIDA model will help Andy run a succinct promotional strategy as the model will help him identify the aim of each part of a marketing campaign and therefore prevent duplication which will reduce cost, ensuring his marketing is cost effective. This will prevent Andy from ineffective marketing I.E marketing that doesn't lead to an increase in sales revenue or in this case class attendance or membership.
SD is a useful data analysis tool along with scatter graphs and extrapolation. Either the formula method or the chart method must be learn in preparation for F293. It is important to understand how and why an organization could use these forms of data analysis as a follow up question is often used.
3. Analyse - What are the business consequences of using the theory. How might it benefit the organisation. IE increase revenue or reduce costs and therefore increase profitability. Go through steps on implication.
The Book of Technique
2. Application - Apply the theory to the case study. Give examples of how the theory can be used. Show that your understanding of theory is thorough enough that you can apply it to a business scenario.
1. Knowledge - show that you have a full understanding of the theory that is being examined. Be explicit nothing is too simple.
Analysis - link terminology to make a succinct argument as how your content point impacts upon the organization in the case study. In both of these videos there is a chain (steps) of points brought together to justify an argument. Be sure to note the detail E.g The better school brings about an engineering job not just a better job. It seems a small point but detail and terminology is so important when achieving L3 (Analysis).
as a result of …
due to the fact that …
furthermore, since …
in addition to …
the result was …
this is why …
which meant that …
what this shows us is …
yet, while the …
which allowed for …
which resulted in the …
Below are phrases or words that allow to make the connections required.
Whilst trawling round the shops it became clear that explaining the advantages and disadvantages of certain types of coat was relatively straightforward (our analysis). For example if we look at a raincoat we can see that it will keep us dry and is fairly lightweight although it may not keep us warm on the coldest days. A duffle coat on the other hand will be warm and durable but may be heavy to carry when not being worn.
What is more difficult is making our final choice (evaluation-making a judgement).
Assuming we have a limited budget and can choose only one coat we need to make a choice and be able to justify it. We may argue that a duffle coat is our best option and that keeping warm is important to us. Can we improve our justification though by saying why keeping warm is more important than keeping dry? (relative importance and significance of points).
For a really good quality judgement we have to take into account our specific circumstances. Do I feel the cold? Do I need it for work or leisure? Do I need it to get to the end of this cold snap or to last 3 or 4 years (short run/long run)? The more applied our judgement is the better our chances of making a good choice.
When we consider evaluation in this light it is clear that it is not some new skill we need to learn but something we do all the time – often without realising it. What pupils need to do is get used to putting this process down in writing.
Below is a great explanation of evaluation. In short it's a reasoned judgement which could take the form of a recommendation. F297 and F293 are both strategic papers as a result you must write from a senior management point of view.
• Comparing - finding points of similarity.
• Contrasting – finding points of difference.
• Evaluating significance of similarities and differences. Do they
matter? Do they have important implications for which model should
be used? How did you decide what was significant?
• Making a judgement. Give reasons for your opinion, based on the
6 - Mark Question - Structure
Changes in price
Cadburys - Oreo Choc
Ipad Air, Iphones 4s, 5, 5s.....- Development not change of market.
Coke - vanilla.
Marketing planning tool that helps an organization decide its product and market strategy.
Each Quadrant is a growth strategy.
These are significant decisions as moving into a new market or developing a product require significant resources. Therefore these decisions can be high risk - particularly diversification due to the lack of knowledge and previous data on which to base decisions.
Using the growth options discussed in the case study apply Ansoffs matirx.
IE what quadrants do the options fall into? Use your understanding of the theory and the information given to you in the case study to develop your argument.
Finish off with a paragraph in which you make a recommendation as to which growth strategy they should use.
Skoda, Coke, Dairy Milk
Products that were invented or launched for one purpose that are now used for a different purpose.
Developing new products for the same market. This goes beyond rebranding as the product itself is new. The Iphone 6 is still within the smart phone market but its developed beyond previous versions.
Diversification. - Often deemed to be the highest risk due to a lack of data and experience.
Reasons for organisations to enter a new overseas market ?
New Customers - Population.
Domestic market may have become saturated.
Recession- boom. Countries out of sync with one another.
Using the textbook and your Ipad go down the questions in each of the Political, Economic, Legal and Cultural factors on page 29 and give answers. Use different countries from across the globe. This is designed to make you aware of the different business cultures that organizations operate in around the world.
E.g - America is politically stable, Syria is not.
How powerful is the trade union movement in America?
Competitive advantage - Presentation
Research an organization - with a view to identifying its competitive advantage.
Use quotes from the website or industry related posts as to justify what you have identified as its competitive advantage.
M&S DF DM
Toyota AH RK
ASOS VS NS
Coca Cola AL AM
John Lewis JO SC JM
Nike TM CT TE
Zara GT JF MI
Apple GB EST IT
Ikea OS WA EG
1. Organise File - use the mind map. Divider for each arm.
2. Fill in the mind map - annotate with basic information.
3. Write a plan and Introduction for Q4 of 2013 June F293.
4. Complete and hand in any outstanding prep. Check with me if your unsure as to what needs to be completed.
Survey - Questionnaire -feedback form, Online, postal, phone.
Other companies data
Historical internal data
Why do market research
Understands the preferences of the organizations target market.
This will aid us in targeting them more effectively. By identifying historical patterns it will be able to predict consumer behavior in the future.
Aids the decision making process.
Gives an insight into what consumers think of competitors.
Opinions - feelings - words - descriptions - SUBJECTIVE
Difficult to analyse/collate.
Higher cost due to the need to use people to interpret information. Time consuming an therefore decisions are made later reducing their reliability.
Slower is disadvantageous because:
First mover advantage.
Objective - Numerical data, facts.
Sales - volume and value (Revenue)
Market size - market segment size
Advantages - Quick due to computers. Big data and its interpretation is a massive growth area within business. Due to the amount of information that is harvested from online. Organisations can extrapolate with significant accuracy leading to improved stock management and therefore a reduction in waste leading to reduced costs. Another use of big data is greater accuracy in targeting market segments which not only increases the effectiveness of marketing and therefore improve sales but also reduces the marketing spend per customer due to the increased accuracy of marketing.
Market Research 13 B
Why undertake MR?
Reduce the population and therefore the cost of the MR. Important as it has a significant influence on the data provided. This is often the source of bias.
Primary - Field
Original - first hand research and therefore is bespoke. Made for a specific purpose. This leads to increased costs as its created from scratch.
However it provides relevant (to the current market and the needs of the business) and up to date information.
Secondary - Desk
Using existing research or information gathered by a third party. It may include internal historical data such as previous years sales figures.
The advantage of this is low cost because it already exists and is not as time consuming.
The main pitfalls of secondary research.
Old - Out of date.
Subjective - explanations - opinions - in their own words. Views/feelings.
Hard to analyse due to it being difficult to collate (Organise).
Time consuming because people are required to interpret responses which leads to slow and therefore costly results.
Possible inaccuracies due "social desirability " - say what is popular.
+ves - Depth - rich in detail. It can be produced from informal methods.
E.g - Surveys - Questionnaires
Define the key term or terms.
What factors need to be considered - can be a list.
Which factors are you going to discuss?
What are you going to use as your yard stick?
Social network marketing refers to the efforts of an organisation to increase the awareness or its product via social media sites such as Twitter, Facebook, Snapchat and Pinterest. Sol needs to take into consideration a number of factors when considering what type of marketing will be effective in an overseas market these include political, religion, culture, language and economics. Considering the similarities between the UK and USA the most relevant factors to discuss are economics and culture. Sol must decide whether they can produce a social network marketing strategy that can overcome the challenges previously mentioned and be cost effective in developing brand recognition the highly competitive Californian market.
This can be a low cost form of marketing and providing it is implemented effectively. IE the advertisement or page engages with its target market and leads to people sharing it can lead to significant brand awarenss.
Other more traditional methods of marketing maybe more cost effective. Above the line methods such as Tv ads would be a relevant alternative.
Sol must decide whether or not this is the most cost effective way to bring about brand awareness in a new competitive market such as California
An organization will aim to bring about electronic word of mouth (ewom) and produce earned media.
13 A Market Research
Primary - Field
Questionnaires - Survey - Online, Phone, Postal.
Secondary - Desk
Internal and External
Numerical data, easy and quick to analyse due to computers being used.
This data is generated using closed questions.
Lower cost due to speed IE reduced hours.
The data can influence decision making quicker. Putting into place the feedback and therefore your product or service will meet the needs of the target market more effectively.
Both primary and secondary methods can produce this form of data.
1a Write a paragraph explaining what Mintel is and what they do.
1b Print off , read and annotate a
from the website.
2. Find out the price of a Mintel
that you would find interesting?
3. What is the price range of reports?
4. What is provided within a report? Using an example cut and paste the contents of a report.
5. Give examples of Mintels product range. – What markets do they research, what type of information do they offer.
6. Would also be a good idea to follow them on twitter as they provide you with good insights into different markets.
Methods of Market Research
Conducted either face to face or over the phone. CATI (computer assisted telephone interviews) and CAWI (Computer assisted web interviewing)
Interviewer is able to respond to answers to glean further information. Questions can be explained to the interviewee. Detail rich responses can be produced providing significant amounts of qualitative data.
Requires interpretation - leads to longer analysis and therefore lengthens the decision making process, which can give a competitive advantage to competitors. Due to the length of some interviews it can be difficult to find enough people willing to participate to provide a meaningful population. Therefore financial incentives often need to be used which increases the cost.
Methods of Market Research
Quick and able to glean both quantitative and qualitative information. A wide range of types - phone, Internet, postal and face to face.
Simple to create and relatively low cost to implement. Skill set required to implement effectively is common.
Can be costly to entice possible participants. Low populations can bring about poor quality data and prevent effective extrapolation. Competitions or cash for surveys can be a costly. Highly dependent upon effective sampling to prevent bias data being produced.
watching consumers shopping or using a product gives significant insight into buyer behavior.
Useful for certain groups. Such as young children or others who are unable to articulate their opinions of a product.
Hard to provide a scenario that is equal to how a product is used in reality.
Steps of implication - L3
Primary MR in particular
Bad decision making
Lower revenue/increased costs
Qualitative takes longer to analyse
this is negative
leads to delayed decision making process
competitive advantage gained by competitors
first to market
reduced market share
Analyse two factors that influence the choice of market research sources used. 6
Type of product
Different target markets
Different methods appropriate due to cost implication - phone, internet postal surveys
Different levels of response
validity of data
impact upon decision making
Choice of advertising influenced
possible stagnation or decline in market share.
Size of target market
Large target markets
ability to sample becomes paramount
decision making comprised
Ineffective launch product
Significant opportunity cost
Political - Changing of the Government may influence certain industries. Green energy - Different political parties have different policies.
Economic - Recession/boom - different levels of disposable income impact upon an organisation TM. Who the TM is, the size of it and the expectations of it.
Social - Trends change - smoking no longer socially acceptable in many situations. Drink driving now seen as horrendously irresponsible previous generations almost accepted, this is reflected in advertising.
Technological - research has shown smoking to be a killer, alcohol and its detrimental effects, colories/obesity, Seatbelts.
Legal - Smoking banned in workplaces and indoors, Drink driving now carries a significant ban.
Environmental - CSR critical to an organization brand. Must be seen to be environmental friendly.
Draw a scater graph using your partners data.
Draw a line of best fit. Using this extrapolate to give a forecast.
If you had a graph with strong correlation create a data set with a weak correlation and visa versa.
See page 21.
Forecast - based on extrapolated data
Advantage - forecasting
Used to justify increased budgets.
Allows the organization to plan and create realistic objectives.
Extrapolation is a simple use of data that be undertaken by all business (Small or large) as it is quick and inexpensive.
Other factors should be taken into consideration. One off historical events - 9/11
Decisions shouldn't be entirely based upon extrapolated data. Other factors should be taken into consideration.
Extrapolation is not available to new organizations.
121, 124, 122, 180, 170, 144, 167, 158, 136, 152
This is very high which shows there is a wide spread around the mean. This would mean that is some outliers. This provides some uncertainty in terms of decision making. The organization may need to repeat the MR to ensure it's validity.
From a market research point of view it would be preferable to have a small standard deviation and therefore a tighter grouping of data as this suggests that the population have similar opinions on the subject of research.
Create a slide using the text book and then send to Michael.
Amy intro t sampling - Inc a picture
Celine intro sampling
Jessie - probability sampling
Roman - simple random
Sam - Systematic
Stratified - James
Cluster - Ollie
Reasons for errors = Emma - non sampling
sampling Errors = Victor
Preps - 2014-2015
How important is market research in the successful launch of a new product. 13 Marks.
to improve decision making of the company. More accurate data allows for better judgements to be made increasing the likelihood of the product being successful. The most vital aspect include identifying the target market and understanding its needs. This can lead product development - market led organisation.
Cost - opportunity cost - could the finance used more productively else where - advertising ensuring brand awareness before the product is launched.
Product led - demand is already there as highlighted by competitor sales. If not first to market would be better to focus on the marketing mix.
Measure the success of a product launch by
Create a product and find a market in which to sell it.
Develop a product to meet the needs of a market or market segment.
Required but to a lesser extent.
Main focus and requires significant finance
Different methods - Secondary - Mintel reports, internet, census, competitor accounts
Primary - Questionnaires (Face to face, telephone, postal, online), focus groups, testing
A - Attention
I - Interest
D - Desire
A - Action
Marketing strategy - Designed to meet objective state - 4 P's
Overseas - PESTLE, Language, cultural
Political, Economic, Social, Technological, legal, environmental.
Marketing audit - what marketing practices are being implemented at this moment in time.
Where are we
Where do we want to be
Market research used to identify SMART objectives. Secondary data such as historical sales data can be used.
How we get there
Marketing Strategies which are made up of tactics.
Growth - market share, revenue, volume of sales.
Factors that influence strategy
Type of market - nature of market - level of competition.
Size of company
Management changes - often bring a new view to marketing.
High risk - more debt - but high reward successful launch the product which rejuvenates the organization. returns it to profitiability
Understanding target market needs/expectations
Meet them* = sales = working towards meeting the objective of increasing sales revenue by 15%
* understand what what flavours would be popular with the target market which is likely to be parents of young children and be in socio economic groups A,B and C1.
Reduces risk - worst possible outcome is failed launch. by undertaking extensive market research the risk of a failed launch is reduced as the product and the promotion is more likely to meet the target markets needs.
Opportunity cost - invest the finance and time elsewhere. Say how this could be spent. Product development - product launch - promotion.
Yardstick - return to profit or revenue based on the information made in the case study.
1. Truncate - stop too soon.
2. No application - make relevant only to Bache's
Analysis L3 - Prevent truncated points - don't stop making points until you get to how the organisation reduces cost or increases revenue,
Socio economic groups - A,B,C1,C2
Advertising Elasticity of demand.
Ways of measuring the effectiveness of marketing.
Revenue is an effective measure of the performance of the wider organizations performance which is influenced by a significant number of factors beyond only marketing. Whilst advertising elasticity of demand is a more precise measure of the effectiveness of the marketing activities of PCL. For this reason I suggest advertising elasticity of demand is the most appropriate measuring tool for David to implement.
Brand awareness - perception of the organisation. Modern and up to date may appeal to younger market segments.
24/7 sales of parts - increased component sales. Develop wider income streams.
Improved customer service - respond to emails/questions.
More services/MOT's booked through an online booking system.
Increased sales of parts would be a benefit of improving PCL's website. This would highlight availability of parts, prices and possibly provide a click and collect service. This would give PCL a competitive advantage over many garages of the same size. The added convenience of this service will attract younger consumers and ensure consumers perceive the garage to be modern and up to date in there methods. These points will lead to greater sales revenue across the services provided and providing the quality of customer service is maintained ensure long term profitability through encouraging customer loyalty amongst young motorists.
Online booking of MOT's/Services would also aid the organisation through increased revenue. If customers had the ability to book there car in at their convenience and see the available slots this will increase the quality of the service provided due PCL providing a USP. By ensuring that the services provided by PCL are differentiated PCL can expect to see their market share rise over the long term particularly as word of mouth is an essential form of marketing in the garage industry.
Word of mouth
Appeal to younger segments of the market
Ensure PCL is viewed as modern organisation
As mentioned by David high quality customer service is key to PCL's success
Increased Market share
Reduced administration costs = fixed costs = improved long term profitability.
The above points are steps that lead to the below
June 2011 - 6 mark Question.