Marketing Flashcards
Marketing and its role
An dynamic, constantly reevaluated and reviewed bridge between an organisation and its customer.
The role of marketing is to anticipate, identify and create new needs and wants.
Marketing goods versus marketing services
- A service is often location-based to which customers need to travel while products may be delivered through distribution channels.
- Customers like their products to be standardised but their services to be customised to suit their individual needs.
- Products are tangible so customers can inspect them (before buying), while services need to be experienced first to have review.
To rival the products benefits of being delivered, services market through physical evidence, process and trained people.
Market share
The sales of the individual firm expressed as an percentage of the total industry sales:
Market share = (total revenue the firm generates)/(total revenue the whole industry generates) x 100
Market size = the total sales of alle the producers within a market
Importance of market share and market leadership
Having significant market share allows an organisation to influence pricing in that market. Revenue growth will also be possible and these additional funds can be invested into improving the marketing effort, further consolidating its position.
Marketing key points
- identify target audience: define key stakeholder
- maintain consisten communication
- create strong visual identity: use logos
- use message repetition whenever possible: create a slogan
- employ multiple communication tactics
Marketing strategies and customer preferences
- trends towards purchasing online rather than from retail stores
- organisations need to be to be more ethical, socially responsible and transparent (growing consumer awarenesses)
- widespread adoption of m-commerce in many countries through an improvement in mobile phones technologies
However, although changing a marketing strategy may benefit some customers, some customers resist change, loosing significant brand value, if it changes too quickly.
Elements of a marketing plan
- a marketing budget
- the strategy employed to fulfil the overall objectives of the organisation
- tactical methods, e.g. elements of the marketing mix, to increase consumer awareness
- a breakdown of expected revenue and costs earned by the product
- a time frame/line to monitor and review progress
- contingencies of action plans to be used if the original plan fails to achieve its objectives
The role of marketing planning
To ensure the organizations marketing strategy is put into operation. Ideally, the plan will have a number of short- and long-term objectives to achieve. It is also important that managers of all departments understand the reason and timings for the plan giving that finance, operation and human resources will be affected: otherwise conflicts could occur.
Good marketing plans allow for:
• adjustments in the external environments to be incorporated into the plan to make it realistic
• an understanding of the competitive environment in which the organization is operating, which will have a direct influence on the marketing mix chosen.
Once again, marketing plans stretch over a number of years, updated regularly especially if the business operating in a rapidly changing marketplace (e.g. Nokia). This can be expensive in both time and capital.
Marketing mix
- product
- price
- people
- place
all important, but not equally: without a quality product, successful promotion can hardly take place
Achieving marketing objectives via marketing mix
a quality product may be successful if:
• an appropriate price, either aimed at the target market or trying to appeal to a new one
• a promotional campaign that raises awareness and is appropriate to the target market
• a distribution channel that allows the consumer purchase the product quickly and avoids frustrations
Target markets and market segmentation
Market segmentation is the process of classifying customers with similar needs and wants within a whole market (e.g. age, lifestyle, occupation).
Once classification has taken place, a business determines an appropriate target market, which allows the business to direct financial resources and the marketing effort more effectively to avoid waste.
- Once a target market has been established, the organisation will monitor consumer preferences and any changes that occur to ensure its own relevance.
- With the internet and social media, the growth of consumer profiling is inevitable.
Features of e-commerce
The list ongoing, adding more and more with advances in technology and Internet.
- no geographical limits; global reach; large potential audience
- huge amounts of data that can be collected in real-time and cost efficiently
- ubiquity: available anywhere and time
- universal standards
- reduces time and cost of buying goods
- reduced supply chain
- often richer experience for customers; social media
- reduced entry costs into markets
- greater personalisation of the marketing message; greater targeting of goods
Below-the-line promotion vs. Above-the-line promotion
Above The Line (ATL) advertising is where mass media is used to promote brands and reach out to the target consumers; not specific to individual consumers.
+ reaches wider audience
– This promotion may not be directly controlled by the company selling the goods or service, such as television or press advertising (loss of control)
– no immediate feedback
Below the line (BTL) advertising is more one to one, and involves the distribution of pamphlets, handbills, stickers, promotions, brochures placed at point of sale, on the roads through banners and placards. \+ immediate feedback \+ better in niche markets \+ cheaper \+ personal -- not as fast
Benefits of e-commerce to consumers
Case study: Amazon.com
- Consumer benefit from significant cost savings by ordering online
- Huge range of choice for products
- direct customer feedback from previous customers allows consumers to assess product performance
- ultrafast (same-day) delivery
- substantial discounts for big orders
- customised online shopping for customers, allowing greater consumer targeting and greater sales (e.g. language and personalised recommendations)
- greater price transparency (comparison of price); consequently the market has become more competitive, to the benefit for all costumers
Drawbacks/costs of e-commerce to consumers
Many drawbacks have minimised over time.
• concerns of personal data being leaked (encryption has mostly eliminated this fear) - PRIVACY AND INTRUSION
• products can not be physically be seen or touched over online websites, however, “try before buy” and better reviews and media of product have minimised this limitation
• increase in spamming and phishing
• information overload
• not ideal in internet-lacking locations
