4.2 Marketing Planning

Question 1

What is a marketing plan?

Answer 1

A marketing plan refers to the document outlining a firm’s marketing objectives and strategies for a specified time period.

Question 2

What is marketing planning?

Answer 2

Marketing planning is the systematic process of devising marketing objectives and appropriate marketing strategies to achieve these goals.

Question 3

What does the typical marketing planning process involve?

Answer 3

The typical Marketing planning process involves:

Marketing audit -
Setting up marketing objectives 
Setting Marketing strategies 
Monitoring and review 
Evaluation

Question 4

What are the key components of a marketing plan?

Answer 4

• Marketing objectives that are SMART.
• Methods of market research.
• An assessment of the strengths and weaknesses of competitors in the market.
• Outline of the marketing mix,
• Outline of the anticipated difficulties and strategies to deal with these problems.
• Include SWOT and STEEPLE analysis

Question 5

What are the benefits and limitations of marketing planning?

Answer 5

Benefits

• Marketing planning improves the firm’s chances of success by helping managers to identify and deal with likely problems.
• The various functional areas of a business will also have a clearer idea of the organization’s objectives and the constraints in which they are to operate.

Limitations

• Many small firms do not have the time, resources or expertise to plan their marketing in such a systematic way making them react to changes in the marketplace.
• Marketing plans can be inflexible and become outdated quite quickly as they do not allow for sudden changes in market conditions.

Question 6

What is the marketing mix?

Answer 6

The marketing mix is the combination of various elements needed to successfully market a product. It is used to review and develop marketing strategies and is important in marketing planning.

Question 7

What are the 4P’s of the marketing mix?

Answer 7

Product - the good or service being marketed to meet the needs and wants of customers.
Price - how much customers have to pay to buy the product
Promotion - methods of informing, reminding and persuading customers to buy the product.
Place - the distribution channels used to get the product to customers.

Question 8

8- Why is setting marketing objectives important?

Answer 8

Setting marketing objectives is important because the targets can:
Provide a sense of purpose, direction and motivation for the marketing department.
Allow progress to be monitored and success to be measured.
Help in the planning and development of an appropriate marketing mix and marketing strategies.

Question 9

Why is setting marketing objectives important?

Answer 9

Setting marketing objectives is important because the targets can:
Provide a sense of purpose, direction and motivation for the marketing department.
Allow progress to be monitored and success to be measured.
Help in the planning and development of an appropriate marketing mix and marketing strategies.

Question 10

What should marketing objectives include?

Answer 10

Marketing objectives include the following:

Market share - This can be achieved through market penetration strategies that allow the business to increase sales revenue and profits.

Market leadership - The firm strives for the greatest market share in the industry.Product positioning - The business tries to improve the corporate image and perceptions held by consumers.

Consumer Satisfaction - This can be achieved by ensuring consumers are satisfied with the price, and product quality and the level of customer service.

High market standing - Market standing refers to the extent to which a firm has a presence in the marketplace.

Question 11

What Strategies can be used to achieve the firm’s marketing objectives?

Answer 11

Market development - involves selling existing products in new markets.
Product development - involves selling new products in existing markets.
Diversification - involves marketing new products in new markets.
Product innovation - refers to the objective of launching an original or new product onto the market.

Question 12

What 3 additional P’s are required in the marketing mix of the marketing of services?

Answer 12

People - refers to the personnel used in the provision of services, e.g. managers, cleaners, concierge, porters, cashiers, security guards, chefs and waiters.

Physical Environment - refers to the tangible aspects of a service, e.g. a clean lobby, nice decor and good quality facilities.

Process - refers to the way in which a service is provided or delivered, e.g. payment methods, waiting (queuing) times and after-sales care.

Question 13

What limitations (constraints) affect the effectiveness of any marketing strategy?

Answer 13

Finance 
Costs of production 
Social issues 
A shift in consumer fashion and tastes
Time lags 
Actions and reactions of competitors
The state of the economy
The political and legal environment

Question 14

Define the terms market segment, targeting and consumer profiles.

Answer 14

A market segment refers to a distinct group of customers with similar characteristics (such as age or gender) and similar wants or needs.

Targeting refers to each distinctive market segment having its own specific marketing mix

Consumer profiles are the demographic and
psychographic characteristics of consumers in different markets, e.g. their age, gender, occupation, income level, religion, marital status and purchasing habits.

Question 15

Why do Businesses segment their markets?

Answer 15

Better understanding of customer’s needs and wants so that a clear marketing strategy can be generated to avoid wastage of resources.

In order to generate Higher sales by focusing and meeting the needs and wants of a particular segment.

In order to identify Growth opportunities
As support for product differentiation and hence spread the risks

Question 16

Identify and explain three methods of identifying markets.

Answer 16

1- Segmentation by demographics
Demography is the study of the characteristics of the human population within a certain area, country or region.

These characteristics include:
Age, Gender, Race And Ethnicity, Marital status, Religious beliefs, Language, Income and socio-economic class

2- Segmentation by geographic factors
The geographic location of customers can have implications for segmentation because demographic factors can be largely influenced by geographic issues.

Geographical factors affecting market segmentation fall into two broad categories.
Location, Climate

3. Segmentation by psychographic factors
   Psychographic factors are those that consider the emotions and lifestyle of customers, such as their hobbies, interests and values, Status, Culture

Question 17

Using appropriate examples distinguish between niche marketing and mass marketing.

Answer 17

Niche1 marketing:
This type of marketing includes the strategy to target a specified market which means that the marketer is aware of the group on which he has to target for its product.
Examples
Businesses that provide high-end speciality goods (such as Louis Vuitton handbags, Bugatticars and Cartier watches) in niche markets, catering for consumers interested in exclusive luxury goods.
Businesses that cater for minority sports such as horse riding.Ultimate Frisbee, Tae Kwon Do also operate in niche markets.

Mass marketing

Mass marketing is defined as a marketing strategy in which the company tries to capture a large audience for its services.

Examples
Coca-Cola is a brand that supports mass marketing, the goal of marketing is to capture a large number of users. Other examples include Samsung, Nike, Toyota and governments to communicate public announcements.

Question 18

What are the advantages and disadvantages of niche marketing?

Answer 18

Advantages

1-There is better marketing focus as a specific market segment is targeted.

2-There Is less competition which means businesses are able to charge higher prices for their unique products and hence gain higher profit margins on their products.

3- Businesses can easily get customer loyalty as they are able to deliver first rate customer service since they are able to meet Firms the needs and wants of their niche target market.

Disadvantages
1- Niche markets are small which limits the number of potential customers in the market.

2- Businesses operating in niche markets have few opportunities to exploit economies of scale.

3-The threat of larger firms entering the market as successful and profitable niche markets attract new entrants into the industry might endanger the survival of businesses operating in niche markets.

Question 19

what are the advantages and disadvantages of mass marketing?

Answer 19

Advantages
1- Businesses can gain from huge potential economies of scale by supplying products in mass markets.

2- Time and resources are saved as the whole market can be targeted with a single marketing campaign.

3- Businesses can establish a bigger customer base, thereby earning more profits.

Disadvantages
1- Mass marketing is not suitable for all businesses as there are high entry barriers for mass production.

2-Competition can become quite fierce and hence high marketing budgets as customers must be persuaded to buy the firm’s products rather than to buy from a rival business.

3-Mass marketing can be quite wasteful as specific customers are not being directly targeted.

Question 20

Define a position Map.

Answer 20

Position map (or perception map) is a visual aid that shows customer perceptions1 of a product or brand in relation to others in the market, often by comparing perceptions about price and quality.

Question 21

What are the benefits of using a position map?

Answer 21

A perception map is simple in presenting potentially complex market research findings.
The position maps are quick and easy to interpret.
Position maps can inform management about market opportunities and threats. If undesired perceptions exist, the business will need to reposition its products.

Question 22

What is a Unique Selling Point?

Answer 22

Unique selling point (or unique selling proposition) refers to any aspect of a product that makes it stand out (in a positive way) from those offered by rival businesses.

Question 23

Explain the role of a unique selling point?

Answer 23

A unique selling point (USP) is a differential factor, which enables the business to distinguish itself from other competitors in the marketplace. As such, a USP is important as it provides more value for money to consumers who would be swayed towards opting for better goods or services. Moreover, a unique selling point allows the business to create a distinct image and as such is an enabler into boosting sales efforts as the product is stronger in itself.

Question 24

What Is Differentiation?

Answer 24

Differentiation is the act of distinguishing a business or its products from rivals in the industry. It tries to create the perception among customers that the firm’s product is different (unique or special) compared with substitute products from rival businesses.

Question 25

How can organizations differentiate themselves and their products from competitors?

Answer 25

Common methods of differentiation revolve around the 8Ps in the marketing mix:
Product, Placement, Process, Price, Promotion , people,
Physical environment, Packaging

Question 26

What are the advantages of differentiation?

Answer 26

1- Price advantages: Firms can only charge a relatively low price for standardized products as customers can have other substitute products to choose from. By contrast differentiation can add value to a firm’s goods and services thus allows it to charge higher prices.

2-Brand recognition and loyalty can be a source of competitive advantage. High brand awareness creates more opportunities for products to be sold.

3-Distribution advantages. Retail space is limited so vendors like supermarkets only sell the best selling brands.

Question 27

What are the disadvantages of differentiation?

Answer 27

1- Differentiation can be very expensive. Special sales and promotions cost money.

2-Economies of scale Savings can not be fully exploited compared with mass production of a single standardized product.

3-Excessive differentiation can drain the firm’s resources and confuse customers.