marketing strategy

Question 1

possible marketing objectives

Answer 1

• increase sales of a product by selling to new or existing markets
• increase sales of a product by improving it
• increasing or maintaining market share
• increasing sales in a niche market

Question 2

factors to consider when forming a marketing strategy

Answer 2

• the marketing objectives
• the marketing budget
• the target market
• balanced marketing mix

Question 3

legal controls on marketing

Answer 3

• weights and measures: sell underweight goods or if the weighing equipment they use is inaccurate
• trade descriptions: illegal to give the consumer a deliberately misleading impression about a product
• sale of goods: illegal to sell products which have serious flaws or problems, that is they are not of a satisfactory quality; products which are not fit for the purpose intended by the consumer ; products which do not perform as described on the label or by the retailer
• supply of goods and services act: a service must be provided with reasonable skill and care.
• illegal to make misleading pricing claims and retailers and manufacturers liable for any damage which their faulty goods might cause
• the consumer contracts regulations allow customers a cooling-off period of 14 working days when products are not bought in a face-to-face situation such as with internet shopping

Question 4

opportunities in new countries

Answer 4

• markets in other countries might have much greater growth potential than existing markets
• home markets might be saturated and these new markets give the chance for higher sales
• there is a wider choice of location to produce products and this encourages businesses to sell as well as produce in these countries
• trade barriers have been lowered in many parts of the world, making it easier and more profitable now to enter these markets

Question 5

threats in new countries

Answer 5

• lack of knowledge: the business may not be aware of competitors or the habits of consumers in these markets
• cultural differences: religion or culture may mean that some products won’t sell in another market
• exchange rate changes: if the exchange rate is not very stable then exchange rate changes can mean the prices of imported goods change and the products can become too expensive to sell in the new market
• import restrictions : if there are tariffs or quotas on imported products then the prices of these products may be higher than domestically produced goods – reducing sales or profits or both
• increased risk of non-payment – methods of payment may be different in these new markets and it may be more difficult to be certain that payment for imported goods will be made
• increased transport costs – as products have to be transported over long distances the costs of getting products to market will increase

Question 6

joint venture limitations

Answer 6

• management conflict between the two businesses
• profits shared

Question 7

licensing limitations

Answer 7

• quality problems caused by an inexperienced licensee could damage brand reputation
• licensee now has access to information about how the product is made – could develop a better version and become a competitor

Question 8

international franchising limitations

Answer 8

• quality problems or poor service offered by franchisees could damage brand image
• training and support will need to be provided by franchisor

Question 9

localising existing brands limitations

Answer 9

• may be less successful than a new product made to meet local cultures and market conditions
• expensive to change packaging, promotion, and so on for each market the product is sold in