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The benefits of begin the market leader with the highest market share include:
Cultural differences:
Failing to respond to cultural differences can lead to bad feeling and bad publicity whereas responding to local tastes and sensibilities can encourage consumers to accept a new brand as being designed for their needs.
Example 3: Getting the name wrong
While Microsoft Vista might conjure up images of open windows and scenic views in some countries, the name means "chicken" or "frumpy women" in Latvian. Getting brand names or logos right can be particularly tricky in some languages.
Sometimes in marketing like in any other area of business you make a mistake:
Ethical considerations:
Marketing activities can have a major impact on whether a business achieves its ethical objectives. Consider advertising sweets to children then there will be arguments for and against taking an ethical stance.
Examples 2: "Children's impulse control for sweets influenced by video games."
A study from the Netherlands has found that children playing computer games featuring advertisements for sweets consume more calories than when the game contains adverts for toys. This research comes at a time when doctors and dieticians are worried about growing rates of obesity, especially amongst young children.
Children with poor self-control where particularly vulnerable and ate more sweets even when offered a reward not to eat.
"Apple Surpassed Samsung As Global Phone Market Leader, Says Report"
Assignment: Do some research to find out about some major marketing mistakes make by organizations. As a reflective CEO, examine how you would respond to the marketing mistakes considered above.
2. Non-profit-making organizations:
A non-profit organization usually has an objective that has a social, cultural, philanthropic, welfare or environmental dimension.
Charities and other non-profit organizations have very clear fund raising objectives - to support their cause or help achieve social objectives and this money needs to be raised in a cost effective way.
Marketing objectives for non-profit include:
Marketing should never stand still. Changed in consumer preference should be researched, anticipated and acted upon by the marketing department. Examples of recent changes are:
Businesses that fail to respond to these and other changes in preference by developing and marketing new products will usually quickly lose sales and market share.
Not all firms are profit maximizers and a number of other corporate objectives exist. Maynard (2009) argues that it is important for non-profit organizations to establish a well-defined niche; while most are not selling goods, they are selling their organization's mission, their ideas, their vision and their services.
In order to sell itself a non-profit organization must:
Innovation:
The major innovation in recent years that have had impact on marketing activities have been internet marketing. The growth of social media networks is encouraging businesses to switch a higher proportion of their budgets towards this form of communicating with customers rather than traditional forms of newspaper and TV advertising.
Example 1: Nike switches to digital
Nike has switched its promotional activities towards digital media such as social networking sites. it has reduced spending on TV by 40% in three years. Most of its huge 2.7 billion US$ marketing budget in 2013 was spent on enhancing its communications with online customers.
Do:
4.1 Activities
market share =
x 100
sales
total market sales
To be effective marketing strategies should:
Marketing objectives are important for the following reasons:
Remember this can be measured by units sold (#) or revenue ($)
Marketing is more than just advertising and selling products.
Marketing is the management task that links the business to the customer by identifying and meeting the needs of customers profitably - it does this by getting the right product at the right price to the right place at the right time.
This includes: market research, product design, pricing, advertising, distribution, customer service and packaging.
Example 1: In a market of 100000 units sold a company has sales of 35000.
35000
100000 x 100 = 35%
Top 10 Marketing Fails
Marketing objectives are the goals that are set for the marketing department to help the business to achieve its overall objectives.
1. For-profit organizations
Examples of marketing objectives are:
Commercial marketing is satisfying consumers needs for profit. It is about providing what customers want, when they want it and where they want it. Ethics play a small role, if any at all. There may be controversies with the market on fast food, soft drinks, tobacco or alcohol but commercial marketing aim to increase sales revenue and profit.
Social marketing is the use of mainstream marketing methods to achieve the benefits of social change. An example would be informing the public about the dangers of under-age drinking.
The social marketing concept:
Important strategic marketing decisions are unlikely to succeed unless they are integrated and coordinated with the other main business functions.
News title: Under Armour increases its Marketing Budget. Company forecasts sales could increase substantially this year.
How are the other business functions impacted by the marketing decisions?
Finance - the department needs to fund the increased promotion budget. Without knowledge from the finance department that adequate finance is available, the marketing department could not increase their budget.
Human Resources - additional employees are likely needed for the additional marketing and promotion activity for Under Armour products to be successful.
Operations - the links between marketing and operations are vital. Market research data will be used by operations to determine the preferences of customers. Output will increase.
The achievement of any or all of these marketing objectives will help the organization achieve its primary profit-seeking corporate objective.
Difference between marketing goods and marketing services
Market orientation
Pros & Cons
Marketing of goods and services can have many similarities as well as differences. Both benefit from creating trust and building brand recognition into the marketing activities but goods can be impulse purchases whereas services need time to be delivered to consumers.
Marketing services focuses on relationship building and trust.
Perceived value. Many service companies focus their marketing efforts on instilling a high perceived value of the service in the minds of the customer. The emotional connection is a key element in service marketing.
Product orientation - an inward looking approach that focuses on making products that can be made or have been made for a long time and trying to sell it.
1. Product- oriented businesses invent and develop products in the belief that they will find consumers to purchase them.
2. Product-oriented business concentrate their efforts on efficiently producing high-quality goods.
Evaluation: The trend now is being market led (oriented) the customer is put first. Most companies have to try and satisfy and increasingly demanding consumer base empowered by knowledge and information from the Internet.
A few companies such as Rolls Royce and Apple are able to operate profitably by concentrating solely on the strength of their product and effectively ignoring the needs of the market. Dyson vacuum too still can be successful due to its innovative product.
Market orientation - an outward looking approach basing product decisions on consumer demand as established by market research.
In this approach the customer is put first and the business attempts to produce what consumers want. This requires market research and market analysis to indicate present and future consumer demand.
Benefits:
Tangible, physical consumer goods are often marketed in different ways to intangible consumer services. Managers responsible for selling services (banking, hotels, hair dressing) have to recognize several key differences between goods and services.
Product Orientation
Pros & Cons
Competitors and ease of entry. All businesses need to be aware of the number and size of their direct competitors and the ease with which new rivals could join the market. Generally, the greater the number of competitors and the easier it is for new ones to joint a market the more price competition there will be. If products can truly be "made different" from rivals products, it might still be possible to charge a high price.
Segmentation. This term refers to the dividing of prospective consumers into groups (segments) who share common tastes and requirements. You would market to distinct groups of consumers who share common tastes and requirements. Segmentation enables companies to target different groups of consumers. Target marketing focuses marketing activity on particular segments of a market. Mass marketing sells to the whole market using a standardized product and the same marketing activities.
Market growth is the percentage change in the total size of a market (volume or value) over a period of time. Some markets are growing faster than others and some are declining rapidly. The pace of growth will depend on several factors including: economic growth, changes in consumer incomes, development of new markets, changes in consumer taste and technological change, which can boost market sales through innovative products. The rate of growth will also depend on whether the market is "saturated" or not. Washing machine sales in North America vs in India.
Differentiated or homogeneous products. Milk, bottled water and gas are products which are difficult to differentiate. A business selling these products will be less able to stand out from their competitors in terms of product quality.
Homogeneous products are goods that are physically identical or viewed as identical by consumers. It will be difficult for a business to charge prices that are different than the "going rate" for these products.
Market size is the total level of sales of all the producers within a market
The size of a market is important for three reasons:
Market size can be measured two ways:
1. volume of sales (units sold)
2. value of goods (revenue)