Unit 3

• Add


  • Labour
  • Costs
• low interest rate


  more disposable income
• Unit 3-Marketing


  Marketing Objectives
• Marketing Objectives


  • 1-Sales Volume +Value
  • number of products
  • value of products
• Mission Statements


  • Mission Statements
  • Corporate Objectives
  • Departmental Marketing
• Success of a business can be based on the size + level of sales
• Size


  Can be measured by Sales volume or value
• Marketing Objectives


  • 1-Sales Volume +Value
  • 2-Market Size
  • Sales Growth
  • 4-Market Share
  • 5-Market Growth
  • Brand Loyalty
  • 7-Market Position
• Increase in market


  Increase in Sales
• Global companies can sell their products + services into expanding markets
• Brand Loyalty


  Measures the degree of attachment a consumer has to a brand
• Market Position


  A company tries to attract new market segment by selling products in new markets
• Influences on Marketing


  • Internal - Mission Statement / corporate objectives
  • Departments - HR, finance, operations
  • External Environment - Competition, Economy recession, Income/Interest Rates, Demographic/Environmental, Technological change
• Quantitative Market Research


  Focuses on gathering information about the market from consumers, based on numbers (sales figures, surveys, yes/no answers)
• Qualitative Market Research


  Focuses on asking consumers questions based on why and how (interviews, focus groups)
• Types of Market Research

  • Primary Research - Original research done by the business
  • Secondary Research - Using existing data that's already been created
• Primary Research


  • Researchers go into the field to ask questions from consumers (experiments, surveys, focus groups, observation)
  • Allows for design of qualitative & quantitative questions
  • More competitive
• Secondary Research


  • Using existing data that's already been created (internet, magazines, newspapers, research marketing firms)
  • Quicker and cheaper
  • Competitors also have access to some info
  • Info can be out of date
• Market Mapping


  A tool to analyse competition in a specific market
• Market Mapping


  • Identifies potential gaps in the market
  • Simple method to analyse competitors
  • Gaps in the market don't guarantee success
  • Only looks at two variables, oversimplistic
• Market research will help increase sales but it doesn't guarantee sales
• Sampling


  Gathering data from a group of people whose views or behaviours are representative of the target market
• Sample Size


  • Larger samples increase reliability but cost more
  • Smaller samples decrease costs but are less reliable
  • Larger samples better for decision making
• Benefits of Sampling


  • Speeds decision making, broad range of opinions, reliable info, helps a business learn about their market
• Drawbacks of Sampling


  • Can be unrepresentative, depends on sample size, biases in answers, may become out of date
• Product Life Cycle


  Where most products experience a period of growth before moving into the decline stage
• Interpretation of Marketing Data

  Looks at confidence intervals, correlation and extrapolation to forecast future sales
• Correlation


  A technique used to work out the strength of a relationship between 2 variables
• Types of Correlation


  • Positive
  • Negative
  • Perfect
  • No Correlation
• Confidence Intervals


  Assess the reliability of sampled data, used to show the accuracy of statistical results arising from sampling
• Extrapolation


  Uses previous numerical data to predict values in the future, based on historical trends
• Strengths of Extrapolation


  • Past trends often continue in the future, steady sales growth
• Weaknesses of Extrapolation


  • Less reliable, external factors like political/economic changes, doesn't consider changes in taste/fashion, doesn't account for product life cycle
• Technology and Marketing Data

  Gathering and analysing market research data has been made more efficient and quicker by using technology (social media, internet, loyalty cards, competitor websites, customer data, financial data, operational data)
• Price Elasticity of Demand (PED)


  Measures the responsiveness of demand to changes in price
• The law of demand states that as price increases, demand decreases
• Types of PED


  • Elastic
  • Inelastic
  • Unitary
• Elastic Demand


  • Change in quantity demanded is greater than change in price, demand is responsive to price changes
• Inelastic Demand


  • Change in quantity demanded is smaller than change in price, demand is unresponsive to price changes
• Unitary Elasticity


  • Both percentage changes are the same