MP - situational analysis and market research Flashcards
what is the marketing process
The marketing process is the steps and activities undertaken to develop the marketing plan and strategies used by the business to reach, inform and persuade consumers in order to generate sales
situational analysis
involves identifying the businesses present position .
It examines:
the businesses internal and external factors
the businesses products
the state of the market
Importance of situational analysis
allows realistic and appropriate marketing goals and strategies to be formulated
step in the situational analysis include:
swot analysis
product life cycle
competitor analysis
SWOT ANALYSIS
Strengths - The things the business does well which it should be built upon
weaknesses - The things the business does not do well which need to be improved
opportunities - Favourable changes in the business environment which should be exploited
threats - Unfavourable changes in the market whose impacts need to be avoided or mitigated
Examples of strengths
Quality reputation Environmentally friendly Market leader Advanced production technology Strong financial position Loyal / strong sales staff Wide product range Competitive price advantage
examples of opportunities
A new industry Few competitors Growing market Favourable government laws New technology
examples of weaknesses
Out of touch with the market Weak financial position Customer dissatisfaction Little vision Poor public image Narrow product range Inferior product /technology
examples of threats
High level of competition Shrinking market / slow growth Unfavourable government laws Expensive technology Market saturation
situational analysis - product life cycle
The business needs to determine the stage of the product life cycle fo each of their products
Each stage of the product life cycle varies in terms of:
i) The length of the time the product has been available
ii) Its level of demand
iii) Customer awareness
what is the product life cycle
introduction - need to attract customers to try the product
growth - encourage brand loyalty, differentiate the product and broaden distribution
maturity - maintain existing customers and attract new ones by redesigning products etc.
decline - sales fall, try to clear stock and eventually eliminate products
Why is the product life cycle important
this will allow the business to develop appropriate marketing strategies given the characteristics of their stage of the cycle
situational analysis - competitor analysis
It is important that businesses assess the level of competition in the market in which they operate in
This is conducted through a competitor analysis – the final piece in a situational analysis
This will involve gathering information/answering questions on:
Who are the competitors?
What strategies are their competitors using?
How will we respond to these competitors via marketing?
why is a competitor analysis important
in order to be truly effective, businesses needs to consider what it looks like from a customer perspective
It allows the businesses to determine how it fits into the broader environment/industry of businesses providing a similar product/service.
what is market research
the process of gathering information about the market in which the business operates.
It is crucial in ensuring the business has accurate information that can be used to make marketing decisions.
It is important that businesses assess the level of competition in the market in which they operate in
types of market research
- Descriptive (gathering information about target market characteristics e.g. demographics, size, expectations etc)
- Exploratory (gathering information as to the reason for a particular problem or outcome)
- Causal (gathering information to test out hypothesis i.e. what would happen if?)
market research process
determine informational needs -> collect data -> data analysis and interpretation
determining informational needs
Businesses must first accurately identify the type of information they need so what is gathered is relevant, useful and accurate.
These informational needs are informed by the various tools within the situational analysis.
data collection
The businesses must determine how it will gather this information
Primary market research involves gathering new information designed to address your specific concerns. Examples include: Surveys/questionnaires, Interviews, Focus groups, Observations
Secondary market research involves analysing previously collected data/information.
This information could come from: Internal business sources such as sales reports, financial statements, External sources such as the ABS, media articles/reports, reports published by research firms (Nielsen, Roy Morgan, CHOICE)
data analysis and interpretation
Data collected needs to be put into a meaningful form so that relationships and trends can be identified and accurate decisions made.
This may be done using: graphs, charts, tables and other diagrams
