4.1 The Role of Marketing

Question 1

Role of marketing

Answer 1

The management process of predicting, identifying and meeting the needs and wants of customers in a profitable manner (ie. right product, at the right price, distributed effectively, and promoted efficiently)

Question 2

Market Size

Answer 2

The magnitude of an industry, usually measured in terms of the value of sales revenue from all the businesses in a particular market

Question 3

Market Growth

Answer 3

The increased percentage in the size of a market per year

Question 4

Market Concentration

Answer 4

The degree of competition that exists within a market by calculating the market shares of the market leaders

Question 5

Market Share

Answer 5

Measures the value of a firm’s sales revenue as a percentage of the total sales revenue in the industry (market share = firm’s sales/ total sales in the market x 100)

Question 6

Market Leadership

Answer 6

Businesses with the largest market share in a particular market

Question 7

Product Orientation

Answer 7

An inward looking marketing approach that focuses on making the product first and then trying to sell it. It is assumed that the supply creates its own demand by producing innovative products that entice consumers

Question 8

Market Orientation

Answer 8

An outward looking marketing approach that focuses on carrying out market research first to identify consumers’ wants and needs, then making products that can sell

Question 9

Commercial Marketing

Answer 9

The use of marketing strategies to meet the needs and wants of customers in a profitable way

Question 10

Social Marketing

Answer 10

Marketing activities designed to influence the social behavior of the general public to benefit society as a whole

Question 11

Marketing relationship with finance

Answer 11

They work together to set fair budgets to ensure the marketing department can meet objectives

Question 12

Marketing relationship with HR

Answer 12

Market research is beneficial to workforce planning (understanding the quantity + quality of employees needed based on predicted customer demand)

Question 13

Marketing relationship with operations

Answer 13

Market research can help identify the certain areas of R&D to focus on to ensure that products meet customers’ needs

Question 14

Difference between marketing of goods and marketing or services

Answer 14

Services are…
- intangible (not physical)
- perishable (consumed at the time of purchase
- variable (each customer experience is unique)
There are 3 new Ps: people, processes, physical evidence

Question 15

Characteristics of a market

Answer 15

• market size
• competition (market saturation)
• market growth rate
• types of products (producer/ consumer)

Question 16

Importance of market leadership

Answer 16

• competitive advantages (brand loyalty, economies of scale)
• higher profits (although not always the case)
• price leadership/ price setting ability

Question 17

Marketing objectives of for-profit/ non-profit organizations

Answer 17

For-profit organizations:
- Generate sales revenue
- Gain greater market share
- Increase customer loyalty

Non-profit organizations:
- Raise awareness of a social issue
- Raise money from the public