Learning objectives for unit 1

Question 1

Explain basic marketing terms.

• Marketing
• Needs
• Wants
• Demand
• Market
• Target Market
• Customer VS Consumer

Answer 1

Marketing: The management process responsible for identifying, anticipating and satisfying customer requirements profitably while satisfying the needs and wants through an exchange process.

Needs: Basic requirements essential for humans to survive.

Wants: Wants are needs shaped by one’s culture and personal preferences.

Demand: When a want is backed by consumer buying power, it becomes a demand.

Market: A market consists of a set of actual and potential buyers of a product.

Target Market: One or more specific groups of potential customers on which a company focuses all its marketing efforts.

Customer VS Consumer: A consumer is the end user of a product or service. The consumer may or may not be the actual buying customer.

Question 2

Describe the key steps in the marketing process.

Answer 2

Step 1: Conduct Marketing Research:

The process begins with a detailed market analysis, usually through market research, like customer surveys as well as competitor and environmental analysis. It enables companies to understand their customers and the marketing environment, to uncover growth opportunities.

Step 2: Develop Marketing Strategy:

Once the company fully understands its customers and the market place, it will develop a
customer-driven marketing strategy to find, attract, keep and grow target customers by
creating, delivering, and communicating superior customer value.

Step 3: Marketing Mix:

Once the marketing strategy has been developed, the company will develop an optimal
marketing mix that will support the positioning in the marketplace. This requires suitable
product(s) to be designed and developed, at a suitable price, with suitable distribution
channels, and an effective promotional programme.

Step 4: Implementation and Control:

Lastly, the marketing plan will be implemented and controlled for effectiveness. After a period
of time, and on a regular basis, the company needs to conduct a marketing audit to review
the performance of various products and may review their segmentation process in order to
re-assess their view of the market and to look for new opportunities.

(C, D, M, I)

Question 3

Describe market segmentation methods and target marketing.

Answer 3

Market segmentation: Dividing a market into smaller groups of buyers with distinct needs, characteristics, or behaviours, who might require separate products or marketing mixes.

Methods:
- Demographic segmentation: Demographic factors are the most popular bases for segmenting customer groups, and also easier to measure and quantify.
- Geographic segmentation: Localising products, advertising, promotion and sales efforts to fit the needs of individual regions, cities and even neighbourhoods.
- Psychographic segmentation: The products and services buyers purchase usually reflect their lifestyles.
- Behavioural segmentation:
1. Benefits Sought. Many products are aimed at consumers that seek specific benefits.
2 . Occasions. Buyers can be grouped according to the occasions when they get the idea to buy, when they actually make the purchase or when they use the purchased item.
3. Usage Rate. Markets can be segmented into light, medium and heavy product users.
4. Loyalty Status. Buyers can be divided based on their loyalty status.
5. User Status. Markets can be segmented into nonusers, ex-users, potential users, first-time users, and regular users of a product.

Target marketing or marketing target: Evaluating each market segment’s attractiveness, and selecting one or more of the market segments to enter.

The purpose of market segmentation and market targeting is to identify the parts of the market that it can serve best and most profitably.

Question 4

Explain the considerations involved in product strategy.

Answer 4

Consideration involved in product strategy are:
- three levels of product benefits
- product line, style, design, quality and features

Question 5

Describe the different distribution channels.

Answer 5

The different distribution channels are:
- Marketing channel
* Direct Distribution Channel
* Indirect Distribution Channel
- Traditional channels
- Online marketing domains

(M, T, O)

Question 6

Describe the promotional mix elements and their characteristic.

Answer 6

5 elements of Promotional Mix:

• Advertising:
  
  • Definition: Any paid form of non-personal presentation and promotion of ideas, goods, or services by an identified sponsor.
  • Characteristic: Advertising can reach masses of geographically dispersed buyers at a low cost per exposure, and it enables marketers to repeat a message many times.
    (Inform / Persuade / Remind)
• Sales Promotion:
  
  • Definition: Short-term incentives to encourage the purchase or sale of a product or service.
  • Characteristic: While advertising and personal selling offer reasons to purchase a product or service, sales promotion offers reasons to buy now.
• Public Relations:
  
  • Definition: It is defined as building good relations with the company’s various publics by obtaining favourable publicity, building up a good corporate image, and handling or heading off unfavourable rumours, stories, and events.
• Personal Selling:
  
  • Definition: It is the personal presentation of the firm’s sales force for the purpose of making sales and building customer relationships.
  • Characteristic: It involves personal interaction between two or more people,and is veryexpensive. Hence, personal selling is usually only used for high-value or costly, technical products.
• Direct Marketing:
  
  • Definition: It is a form of advertising in which a marketer seeks to elicit a response directly and immediately from a consumer.
  • Characteristic: The response could be an order, a visit to a website, or a call-to-action. Direct marketing uses direct mail, telephone, direct response television, email, the internet and many other tools to communicate directly with specific consumers.