The Nature of Marketing

Question 1

Marketing

Answer 1

Is the manage meant task of identifying customer needs and satisfying them profitably

Question 2

Marketing objectives

Answer 2

The goals set for marketing department to help business achieve its overall objectives

Question 3

Why are marketing objectives important

Answer 3

-They provide a sense of focused direction
-Business success can be measured against the set by objectives
-Marketing objectives can be broken down to sales targets
-Marketing objectives form the basis of marketing strategy

Question 4

Marketing strategy

Answer 4

Plan of action as to how a business would meet its marketing objectives and create competitive advantage

Question 5

Market segment

Answer 5

A subgroup of a whole market which bring together consumers w similar interests

Question 6

Industrial market

Answer 6

The selling of products by businesses to other businesses, AKA B2B

Question 7

Consumer market

Answer 7

The selling of products by business to final end users,
AKA B2C

Question 8

Customer orientated

Answer 8

An outward approach that bases the product decisions on consumer demand

Question 9

Product orientated

Answer 9

An inward approach that focuses on making products that can be made or have been made for a long time.

Question 10

Benefits of customer oriented

Answer 10

-Chances of products failing is reduced
-Products based on customer needs will have longer life span

Question 11

Market size

Answer 11

The total value of sales all producers within a market in a given time period

Question 12

Importance of market size

Answer 12

-It allows managers to asses whether a market is worth entering
-It allows a business to calc its own share of the market
-The growth or decline of the market over time can be defined

Question 13

Market growth

Answer 13

The percentage change in total size of the market over a period of time

Question 14

Brand leader

Answer 14

The brand with the highest market share

Question 15

Implications of increase and decease market growth

Answer 15

Increased
-Sales will increase
-Maybe an increase in prices and profit per unit
-More business might be attracted to the market, increasing level of competition

Reduced
-Sales will increase slowly if market share remains the same
-Competitors might reduce prices to increase sales in a slow growing market
-Lower prices might result in lower profit

Question 16

Mass marketing

Answer 16

Selling standardised products or ranges of products in the same way to the whole market

Question 17

Benefits and limitation of mass marketing

Answer 17

Benefits
-High sales may lead to lower average costs
-Cost advantages lead to lower price for consumers
-Mass marketing results in extensive publicity for the business, which leads to clear brand identity

Limitations
-Lack of differentiated products
-The focus on low prices establish premium brand image
-Changes could lead to fall in demand for the standardised product

Question 18

Benefits and Limitations of Niche marketing

Answer 18

Benefits
-Small businesses can survive and thrive in markets
-An unexploited niche has no competitors, so prices can be high
-Niche and exclusive marketing can be used by larger firms to create status and image

Limitations
-Does not allow economies of scale
-Limited scope for business growth
-If selling in a niche market is profitable, attracts more competitors

Question 19

Market segmentation

Answer 19

The identification of different groups of customers with common needs within a market and the marketing of different products services for those groups

Question 20

Consumer profile

Answer 20

A quantified picture of a businesses consumers, showing data about their age groups, income levels, gender etc

Question 21

Benefits and limitations of market segments

Answer 21

Benefits
-Businesses can define their target market precisely
-Enables identification of gaps in the market which can be exploited
-Small firms are able to specialise in one or two markets
-Price discrimination between consumer groups can increase revenue and profits

Limitations
-RnD and production cost maybe high
-Promotional costs maybe be high
-Inventory costs would be higher than selling on undifferentiated product
-Extensive market research is required

Question 22

Customer relationship marketing
(CRM)

Answer 22

Using marketing activités to build and establish good customer relationships so customer loyalty remains

Question 23

Long term customer relationships can be achieved by

Answer 23

-Targeted marketing
-Customer service and support
-Communicate regularly w customers
-Using social media

Question 24

Benefits and limitations of CRM

Answer 24

Benefits
-CRM is cost effective
-It is a sustainable strategy creating long term customers
-Loyal customers recommend to others so there is free additional marketing
-Costs less than attracting new customers

Limitations
-IT systems and softwares are needed
-Effective CRM campaigns may use expensive external consultancies
-CRM requires an existing customer base
-It may be costly to respond to customers feedback