Professional Documents
Culture Documents
Marketing Management
Marketing Management
examples
misilamani@yahoo.com
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The Presenter
This module is presented by,
R.MASILAMANI(Masi in short) He has more than 30 years of working, training & consulting
experience Has acquired a profound knowledge and exposure to management, in general, and some specific disciplines, in particular His specifics include performance management, leadership, finance and project management His exposure includes, Mc Kenzie, Dale Canegie, INTAN, PETRONAS, OUM, UTM and some other private educators and companies, both local and international Marketing is one of his passionate areas of focus
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Agenda
Objectives Introduction Managing the Marketing Mix Marketing Management Philosophies Competitive Strategies Impact of IT on Marketing Mix
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The Objectives
In this course, we will learn, Why is marketing important? What is the scope of marketing? What are some core marketing concepts? How has marketing management changed in recent years? What are the tasks necessary for successful marketing management
Principal Source: Marketing Management, Philip Kotler and Kevin Keller(12th,13th &14th editions)
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The Introduction
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Services
Revenue Operating income Net income Total assets Total equity Owner(s) Employees Divisions Subsidiaries Website
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1 Wal-Mart Stores 2 Exxon Mobil 3 Chevron 4 General Electric 5 Bank of America Corp. 6 ConocoPhillips 7 AT&T 8 Ford Motor 9 J.P. Morgan Chase & Co. 10 Hewlett-Packard
11 Berkshire Hathaway 12 Citigroup 13 Verizon Communications 14 McKesson 15 General Motors 16 American Internatlonal Group 17 Cardinal Health 18 CVS/Caremark 19 Wells Fargo 20 Intl. Business Machines
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2010 1.Wal-Mart Stores 2.Royal Dutch Shell 3.Exxon Mobil 4.BP 5.Toyota Motor 6.Japan Post Holdings 7.Sinopec 8.State Grid 9.AXA 10.China National Petroleum
2009 1. Exxon Mobil 2. Wal-Mart Stores 3. Chevron 4. ConocoPhillips 5. General Electric 6. General Motors 7. Ford Motor 8. AT&T 9. Hewlett-Packard 10. Valero Energy
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What is Marketing
Oxford defines marketing as the action or business of
promoting and selling products or services, including market research and advertising. The management process responsible for identifying, anticipating and satisfying customer requirements profitably Institute of Marketing Marketing is a customer orientation, backed by marketing programs aimed at generating customer satisfaction, as the key to achieving organisational goals- - Philip Kotler
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Stuart Atkins-Atkins Marketing Solutions Philip Kotler, Marketing Management: Analysis, Planning, Implementation, and Control, 7th ed. (Upper Saddle River, NJ: Prentice Hall, 1991), 31
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MARKETING - DEFINITION
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I thought we were doing marketing. We have a corporate Vice President for marketing, a top-notch sales force, a skilled advertising department and an elaborate marketing planning procedures. These fooled us. When the crunch came, I realized that we were not producing the cars that people wanted. We were not responding to new needs. Our marketing operation was nothing more than a glorified sales department -Lee Iococca
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In what areas of marketing management would you most like your company to improve? Top Priority:____________
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Brands are NOT built on advertising, they are built on trust in the brands promise of value (Amazon)
Demonstrate value: SciQuest Defend your price: AOL Build bridges to the Old Economy Leverage synergies: AOL-Time Warner Click-and-Mortar: ToyRUs
Ref: Kotler
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Marketing management
Is the analysis, planning, implementation and control of programs designed to create, build and maintain mutually beneficial exchanges and relationships with target buyers for the purpose of achieving organisational objectives It is synonimous with demand management
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Selling VS Marketing
FOCUS
PRODUCTS
MEANS
SELLING AND PROMOTING
END
PROFITS THROUGH SALES VOLUME
NEEDS
INTEGRATED MARKETING
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Marketing Environment
The market environment refers to factors and forces that affect a firms ability to build and maintain successful relationships with customers Three levels of the environment are: Micro (internal) environment - marketing forces within the company that affect its ability to serve its customers. Meso environment the industry in which a company operates and the industrys market(s). Macro (national) environment - larger societal forces that affect the microenvironment
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Economic Environment
Natural Environment
Political-Legal Environment
Technological Environment
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1. IDENTIFY your audience or market 2. Thoroughly UNDERSTAND your audience or market 3. SELECT the marketing mediums that your target is most engaged with 4. DEVELOP a messaging strategy to effectively communicate with your audience
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Marketing Plan
The marketing plan is the central instrument for directing and coordinating the marketing effort. Market Planning is the managerial process of developing and maintaining a viable fit between the organizations objectives, skills and resources and its changing market opportunities. The aim of strategic planning is to shape and reshape the companys businesses and products so that they yield target profits and growth.
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Marketing Plan
The marketing plan operates at two levels. The strategic marketing plan develops the broad marketing objectives and strategies based on an analysis of target market and value proposition. The tactical marketing plan outlines specific marketing tactics, including advertising, merchandising, pricing, channels, service and so on.
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CORPORATE PLANNING
DIVISIONAL PLANNING SECTIONAL PLANNING PRODUCT PLANNING ORGANISING
IMPLEMENTING
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Peter Drucker has mentioned the following questions to be asked for setting corporate mission
What is our business?
What should our business be? Who is the customer ? What is of value to the customer ?
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Ansoff has proposed Product/ Market Expansion Grid for the same
Current Products Current Markets New Products
New Markets
2. Market-development strategy
4. Diversification strategy
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SWOT Analysis
Internal Factors Strength Technological skills Leading Brands Distribution Channels Customer Loyalty/Relationship Quality of Product/Service Economies of Scales Opportunities New Distribution Channels Changing customer tastes Liberalisation of Geographical Markets Technological advances Changes in govt. policies Lower personal taxes Weaknesses Absence of Important skills Weak Brands Illogical Distribution Low customer Retention Unreliable product/se
External Factors
Threats Changing customer tastes Closing of geographical market Technological advances Changes in govt. policies Tax increases Change in population age structure
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SALES FORCE
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SALES FORCE
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PRESIDENT
SALES FORCE
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SALES FORCE
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Product
Price Place Promotion
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Functional Organisation
Marketing VP
Sales Mgr
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MANUFAC TURING
MARKETING
FINANCE
MARKETING RESEARCH
PRODUCT MANAGEMENT
PRODUCT MGR 1
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PRODUCT MANGER 2
PRODUCT MANAGER 3
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MNFG
MKTG
FIN
PR & CC
MGR REGION 1
MGR REGION 2
MGR REGION 3
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Product vs Market
Market Managers Mens Wear Womens Wear Home Furnishings Industrial Markets
P r o d u c t M a n a g e r s
Rahul
Radzi
Rayon
Ravin
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INDUSTRIAL ANALYSIS
CORE STRATEGY
COMPANY ANALYSIS
MARKAT TARGET
COMPETITIVE POSITIONING
DIFFERENTIAL ADVANTAGE
CONTROL
IMPLEMENTATION
ORGANIZATION
MARKETING MIX
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Catalyst for GLOMAC
PLAN Malaysias Glomac Bhd is expected to be more than RM500mil strong, buoyed by demand in its three major townships, compared to RM400mil in 2011.
. The sales of its township development in Sungai Buluh, Rawang and sri ir Saujana in
Johore did very well.
. About 97% of the of the Reflection Resiednces in Mutiara Damansara launched in April
have been taken up.
. We have been expanding our land our land bank quite robustly in the last 18 months
said Iskandar, its Group CEO. We will be launching the SG Buluh development by year end. We will also be looking at developing our land in Sepang, 4.5 Km to International Airport he added. STRATEGY On its strategies, Iskandar revealed thatGlomac is keen to build landed property as there is good demand for it currently. We are also interested in acquiring more land in the Greater Kuala Lumpur area with the right prices he said further.
Source: STAR Biz, 20 June, 2012 16/6/2012 51
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Marketing Mix
Marketing mix (Product, Price, Place, Promotion) When marketing their products firms need to create a successful mix of:
the right product sold at the right price in the right place using the most suitable promotion
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Once you've developed your marketing strategy, there is a "Seven P Formula" you should use to continually evaluate and re-evaluate your business activities (generally its 4Ps)
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Marketing Mix
Marketing Mix or the 4Ps of Marketing are the variables that marketing managers can control In order to best satisfy customers in the target market. The Marketing Mix can be diagramatically portrayed AS:
PRODUCT
PLACE
TARGET MARKET
PRICE
PROMOTION
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Marketing Mix
To create the right marketing mix, businesses have to meet the following conditions: The product has to have the right features - for example, it must look good and work well. The price must be right. Consumer will need to buy in large numbers to produce a healthy profit. The goods must be in the right place at the right time. Making sure that the goods arrive when and where they are wanted is an important operation. The target group needs to be made aware of the existence and availability of the product through promotion. Successful promotion helps a firm to spread costs over a larger output
Read more: http://businesscasestudies.co.uk/business-theory/marketing/marketing-mix-price-place-promotionproduct.html#ixzz1xs2VtqVB
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A global company is one that can create a single product and only have to tweak elements for different markets. For example, Coca-Cola uses two formulas (one with sugar, one with corn syrup) for all markets. The product packaging in every country incorporates the contour bottle design and the dynamic ribbon in some way, shape, or form. However, the bottle can also include the countrys native language and is the same size as other beverage bottles or cans in that same country. Price Price will always vary from market to market. Price is affected by many variables: cost of product development (produced locally or imported), cost of ingredients, cost of delivery (transportation, tariffs, etc.), and much more. Additionally, the products position in relation to the competition influences the ultimate profit margin. Whether this product is considered the high-end, expensive choice, the economical, low-cost choice, or something in-between helps determine the price point Placement How the product is distributed is also a country-by-country decision influenced by how the competition is being offered to the target market. Using Coca-Cola as an example again, not all cultures use vending machines. In the United States, beverages are sold by the pallet via warehouse stores. In India, this is not an option. Placement decisions must also consider the products position in the market place. For example, a high-end product would not want to be distributed via a dollar store in the United States. Conversely, a product promoted as the low-cost option in France would find limited success in a pricey boutique
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By focusing on the needs of consumers, an organisation creates a business that can outperform its competitors. Being closer to consumers and providing exactly what they want is known as market orientation. A market-orientated business carries out research to find the needs and wants of consumers. It then uses the findings to design products and marketing strategies to satisfy these needs...
This marketing mix case study describes how JD (part of the JD Sports Fashion PLC Group of companies), a large and well-known retailer, manages the balance of its marketing mix around its consumers' needs in order to achieve business growth
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The 4Ps
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What is a product?
a product is anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need. It includes physical objects, services, persons. places, organisations and ideas. - Philip Kotler, Principles of Marketing
A JD Sports case study: Product
1. For each product or service you offer, do you know which stage of the product life cycle they fit? 2. Are there any changes you can make to mature and declining products that may allow new life? 3. For mature products or services, are there new markets or segments open for expansion (geography, demographics, and so forth)? 4. Plug in product life cycle awareness to new or future products you may be planning to release. 5. Are there price changes needed for your products or services based on their current PLC stage?
Your product, price, place, and promotional strategies also apply differently, depending on how young or how mature your product is. Dont just manage a product, but plan its life. Like an investment, it may need some thoughtful guidance
Core Product
Augmented Product
(Installation , delivery and credit, after sales service, warranty)
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Tangible Product
(packaging, style , features, brand quality)
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The four main stages of a product's life cycle and the accompanying characteristics are: Stage
1. Market introduction stage
Characteristics
1.costs are very high 2.slow sales volumes to start 3.little or no competition 4.demand has to be created 5.customers have to be prompted to try the product 6.makes no money at this stage 1.costs reduced due to economies of scale 2.sales volume increases significantly 3.profitability begins to rise 4.public awareness increases 5.competition begins to increase with a few new players in establishing market 6.increased competition leads to price decreases 1.costs are lowered as a result of production volumes increasing and experience curve effects 2.sales volume peaks and market saturation is reached 3.increase in competitors entering the market 4.prices tend to drop due to the proliferation of competing products 5.brand differentiation and feature diversification is emphasized to maintain or increase market share 6.Industrial profits go down 1.costs become counter-optimal 2.sales volume decline 3.prices, profitability diminish 4.profit becomes more a challenge of production/distribution efficiency than increased sales 69
2. Growth stage
3. Maturity stage
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Limitations of PLC
Factors Introduction Growth Maturity Decline/Satur ation
Sales
Investment Cost
Low
High
High(Lower than intro stage)
High
Low
Very High
Low
Low
Competition
High
Very High
Low
Advertising Profit
High High
High High
Low Low
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Time Introduction
Growth Maturity Decline Saturation
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SATURATION
SPARE
MATURITY
RECYCLE
GROWTH
INTRODUCTION
Product Quality
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Pricing Moves
Market Segmentation
Designing products
New product Development Strategy: Primary Decision Idea Generation Idea Screening Concept Development Testing Marketing Strategy Development Business Analysis Product Development, and Market Testing
JD Sports case study: Product
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Designing products
Product Life Cycle Strategies:
Preliminary discussion Introduction stage Growth stage Maturity Stage
Case Study 2: Decline Stage Apple iPhone versus HTC Touch: Which brand of
touch-screen phone will the Asian consumer bite into?
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AUGMENTED PRODUCT(INTAN GIBLE) Delivery and credit Installation After sales service warranty
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INTRODUCTION
GROWTH
MATURITY
TIME
DECLINE
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capacity
Sales
Saturation
Time
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Typical profitability
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The Product Life Cycle Curve May Have More Than One Shape
1.The high learning product life cycle 2.The missing link and other low learning substantive product life cycles 3.1.The fad With a significant residual market
3.The fad
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The Product Life Cycle Curve May Have More Than One Shape
.The pyramid cycle 7.The aborted introduction
Re-growth periods
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IDEA ACQUITITION INITIAL SCREENING BUSINESS ANALYSIS PRODUCT DEVELOPMENT MARKET TESTING INTRODUCTION
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Brand Equity
Definition: Brand equity is a phrase used in the marketing industry to try to describe the value of having a well-known brand name
Case 3:
A sauce "on its course" - The Lee Kum Kee brand and its longevity as a family business through building strong brand recognition
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What is PRICE?
PRICE is the value placed on what is exchanged. PRICE is not always money paid The profit factor can be determined mathematically(P*Q-TC) PRICE is the only variable in the marketing mix that can be adjusted quickly and easily
JD Sports case study: Price
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Pricing Objectives
Pricing objectives is the overall goals that describe what the firm wants to achieve through its pricing efforts The objectives must be consistent with the companys overall mission and purpose First the company has to decide ways to accomplish with its particular product. If the company has selected its target market and market positioning carefully, then its marketing mix strategy, including price, will follow.
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PRICING DECISIONS
BUYERS PERCEPTIONS
COMPETITION
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Price Guidelines
Dont overestimate the importance of price Value for money Is price a barometer of Quality Beware of dealing with the lowest bidder If you deal with the lowest bidder it is wise to add something for the risk you run. And if you do that you will have enough to pay something better
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Pricing Options
Psychological Pricing Company Pricing Policies Geographical Pricing Discounts Promotional Pricing Product Bundling Pricing Optional Feature Pricing Two part pricing
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Pricing Options
Marginal cost too Low Price limit Price Limit Average Price Going Per Unit Rate Price Too High Price Limit
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OR Penetration
- low initial price, fast rate of product adoption, hence steeper experience curve
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Price Determinants
CUSTOMERS
COMPETITION
COSTS
The Three Cs
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What is PLACE?
Marketing experts know that the best product in the world will never make an impact in the business world if no one can locate and obtain it (Delaney, 1994). So the location of your business is PLACE Place is the location of business
A JD Sports case study: Place
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Distribution Channels
Channels
Supplier Wholesaler Agent Distributer Retailer Customer
Flows
Information Product Finance Communication
Logistics
Information Processing Product Availability Service Delivery Account Management
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DIRECT SALES
DISTRIBU TERS
DEALERS
AGENTS
LICENSING
PRIVATE LABLE
RETAIL OUTLETS
BROKERS
COMPUT ER TO COMPUT ER
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Distribution Analysis
Is the desired market access being achieved? How are the individual distribution channels evolving? Are outlets giving appropriate service? Does the strategy give competitive advantage? Are distributers regularly assessed? Are individual distributers becoming too powerful? Is competition among distributers becoming too strong?
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What is PROMOTION
It is fair and accurate to say that promotion is one of the pillars of success The success of the promotional message is evidenced by the cross-generational loyalty of customers and many other factors in companies PROMOTION is just selling at the right place and right time
JD Sports case study: Promotion
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Promotional Mix
Unawareness
Sales Promotion
After Sales Service
Action
Satisfaction
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Promotion Mix
Fast Moving Consumer Customer Durable Fast moving Industrial Industrial durable
Personal Selling
Sales Promotion
Publicity
Advertising
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Communications process
SENDER
MESSAGE
RECEIVER
SENDER
RESPONSE
CIRCULAR MODEL
STIMULUS
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RECEIVER
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COMMUNICATIONS STRATEGY
E.g. What shall we say? How shall we say it? What should they think? What should they do Decisions
Why(objectives) Who(target) What(Copy platform) Where(media) How(creative platform)
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Manufacturer Manufacturer
Wholesaler
Retailer
Consumer
Consumer
Distribution Strategies
Depending on the type of product being distributed there are three common distribution strategies available:
Distribution Strategies
Depending on the type of product being distributed there are three common distribution strategies available: 1.Intensive distribution : Used commonly to distribute low priced or impulse purchase products eg chocolates, soft drinks. 2. Exclusive distribution : Involves limiting distribution to a single outlet. The product is usually highly priced, and requires the intermediary to place much detail in its sell. An example of would be the sale of vehicles through exclusive dealers 3. Selective Distribution : A small number of retail outlets are chosen to distribute the product. Selective distribution is common with products such as computers, televisions household appliances, where consumers are willing to shop around and where manufacturers want a large geographical spread.
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Marketing concepts
The Production Concept The philosophy that consumers will favour the product that is available and highly affordable and that management should focus on improving production and distribution efficiency The Product Concept
The idea that consumers will favour products that offer the most quality performance and features and that the organisation should therefore devote its energy to making continuous product improvements
The selling Concept The idea that consumers will not buy enough of the organisations products unless the organisation undertakes a large scale selling and promotion effort
The Societal Marketing Concept The idea that the organisation should determine, the needs, wants and interests of the target marketnts and deliver the desired satisfactions mare effectively and efficiently than competitors in a way that maintains or improves the consumers and societys well being
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Competitive Analysis
What environmental factors are affecting the organisation? What of these have most impact now and in the future? You may analyse using the PEST concept Michael porters five forces of competitive framewok Using the structural determinants
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Assumptions
Capabilities
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communicating the value planning the value choosing the value providing the value creating the value
expertise, distinctive capabilities tend to describe _________.
2. Whereas core competencies tend to refer to areas of special technical and production
distinctive labour practices excellence in research capabilities competitive advantages excellence in broader business processes distinguishing features of the company from its competitors
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marketing plan strategic marketing plan tactical marketing plan mission statement growth matrix
4. A company's organization consists of its _________.
staff; policies; commitment structures; policies; corporate culture staff; policies; corporate culture structures; policies; competitive culture strategies; policies; corporate culture
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5. SWOT analysis refers to an analysis of a company's _____ systems; withholdings; operations; technology strategic units; workers; opportunities; technology systems; weaknesses; operations; threats strengths; weaknesses; opportunities; threats strengths; weaknesses; opportunities; technology 6. The last section in a marketing plan should contain _________. a situation analysis an executive summary and table of contents implementation controls a marketing strategy financial projections
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True False
12. Value exploration is concerned with how a company can efficiently create more promising new value offerings.
True False
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Market Research
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the systematic and objective problem analysis, model building and the fact finding for the purposes of improved decision making and control in the marketing of goods and services Kotler
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SUPPLIER
MARKET RESEARCH
BUYER
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Company Resources
Goodwill Skills Know-how Patent People Materials Money Marketing Research and Measurem ent
Company programs Organization Marketing Manufacturing Procurement Personnel Finance Research Development
COMPETITIVE, TECHNOLOGICAL etc.
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MARKETING RESEARCH
SPECIAL PROJECTS
WHERE is marketing research used? Setting objectives Problem solving Helping the business to grow
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Research Objectives
Research objectives should be set with possible actions and decisions in mind; ask yourself:-what information do I need? -how will I use the research data? SETTING OBJECTIVES PROBLEM SOLVING HELPING THE BUSINESS TO GROW IDENTIFY EXISTING AND POTENTIAL CUSTOMER GROUP PREPARE CUSTOMER PROFILES FROM EXISTING INFORMATION
IDENTIFY PROBLEM
TYPES OF RESEARCH
Desk research
Study of public information 1. Provides an economic background 2. Assesses market size and trends 3. Analyses market structure 4. Obtains data on companies 5. Obtains data on products and services
Field research
Collecting information directly from the market 1. Customers attitudes and perceptions of companies and products and services 2. Awareness of a company/brand 3. Awareness of an advertising campaign 4. Reaction to a potential action by a supplier, e.g. a price rise, product improvement
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Global Marketing
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