business marketing 2

• Strategies undertaken to achieve the business' marketing objectives through the marketing mix:

  Product - determining quality, packaging, labelling

  Price - whether to set above, below or around competitor price

  Promotion - methods business use to inform, persuade customer to buy products

  Place - intermediaries and physical distribution
• Marketing


  Total system of interacting activities designed to plan, price, promote and distribute products to customer (potential or current) so individual and organisational objectives are met
• Aspects of Marketing Mix for goods and services

  Goods and services: Product, price, place/distribution, promotion

  Services (only): People, processes, physical evidence
• Strategic Role of Marketing

  Monitoring and analysising and creation of marketing plan
• Monitoring and analysing


  Competitors behaviour, living standards, employment, brand awareness, need and wants, marketing trends to produce a marketing plan effective to the business
• Goals of marketing plan

  Document that lists activities that two strategic goals of marketing

  -Profit Maximisation: Maximum difference between total revenue and costs

  -Customer Orientation: Placing customer satisfaction at the core of business decisions to ensure customer satisfaction
• Marketing Plan


  Outline strategies that bring buyer and seller together

  Cost of marketing satisfying existing customers wants, leading to loyalty

  Only revenue generating activity of any business
• interdependence with other key business functions

  Operations:

  Sales predictions

  Affect volume of products produced and changes to production process

  Impact ordering of supplies

  Finance:

  Sales and profit forecasts

  Used to produce budgets and set system of controls

  Provide reason for borrowing

  Human Resources:

  Marketing determines volume and quality demanded

  Affects number, skills and relocation of new and existing staff
• production, selling, marketing approaches

  Production Approach 1820s-1920s

  -Focus on production → Assume they'll be purchased → Industrial revolution

  Sales Approach 1920s-1960s

  -Emphasises selling due to increased competition

  Marketing Approach 1960s-present

  -Emphasis on appealing to customers wants and needs through understanding their orientation→ Requires effective marketing plan
• Resource Markets


  Primary Production including mining agriculture, forestry and fishing
• Industrial Markets


  Industries and businesses that purchase products to use in production process or daily operations
• Intermediate Markets


  Wholesalers and retailers who purchase finished products and resell E.g. JB-Hi-Fi sells iPhones purchased from Apple
• Consumer Markets


  Products used by individual members of a household. Includes mass, niche and segment markets
• Mass Market


  Mass-produced, mass-distributed and mass-promoted products to a large market.
• Niche Market


  Narrowly selected target market segment, also known as concentrated or micro markets.
• Influences on marketing acronym

  FECD - Freddie Eats Car Detergent
• factors influencing customer choice acronym

  People, stop, eating, garlic
• Psychological + Role


  Influences within an individual that affect their buying behaviour

  Importance:

  Understand factors influencing customer choice → predict trend and customer reactions

  Allows marketer to create more effective and profitable strategies that appeal directly to the customer's motives and behaviours
• Perception


  People use to filter, organise and attribute meaning to external stimuli

  -Important to understanding perspectives on a particular brand/product

  -Market managers try to create a favourable perception of their product by associating it with positive things/ideas
• Motives


  The reasons a consumer makes decisions or act in a specific ways

  E.g. Comfort, health, safety, approval
• Attitudes


  An individual's relatively stable and consistent feelings or thoughts towards an objects, activity or business
• Personality and Self-Image


  The behaviours and characteristics that make up a person=Personality

  Personal view or want others to view them=Self-image
• Learning (factors influencing customer choice)

  Occurs when new info or experiences cause a change in individual behaviour

  -E.g. When smoking was discovered to be deadly, many stopped buying.
• Sociocultural


  Relative rank in society, impacts quality and quantity of product boughts.

  1.Culture:System of values, beliefs, traditions and behaviours of society.

  Subculture: Group of individuals that share qualities differentiating them from society.

  Determine a person's predisposition to certain buying habits

  2.Family and Roles: Who is responsible for purchasing decisions, different people in the family buy different things

  3.Reference Groups: Any group a person identifies with determining attitudes value and beliefs, reference groups affect what people buy to fit into certain groups
• Economic


  Economic conditions affect the number of competitors (employment, economic growth/decline), cost of production and sales volume.

  Economic conditions influence the consumers willingness to purchase a business's products.

  Boom→ Growing economy, competition, employment and consumer willingness to buy

  Bust→ Decreasing employment, spending levels (more price conscious customers)

  Maintaining market share is utmost importance during bust
• Government


  influences marketing through economic policy and regulations/laws

  -Government's economic policy influences consumer spending → expand or contract the level of economic activity.

  -Regulations criminalises certain marketing practises that provide unfair competitive advantages or inhibit informed consumer choice
• Consumer Laws


  Competition and Consumer act (2010) prohibits various unfair trading practises associated with advertising/marketing → Enforced by Australian competition and consumer commission (ACCC)
• Deceptive and misleading advertising methods


  1.Bait and switch:Advertising various products at reduced price to grow interest, only to not stock enough to meet demand → directs customers to more expensive products

  2.Dishonest Ads: Usage of deceptive words/claims in advertising to mislead customers into associating a false impression of a product

  -Unsubstantiated claims: '9 out of ten people prefer' without any actual market research conducted

  -Before and after: Distorted comparison in advertising.
• Price Discrimination


  -Differentiation of price unfairly between markets to reduce competition→ Geographic, product differentiation (different electricity prices for business and domestic users)
• Implied conditions


  Unspoken and unwritten terms in a contract
• Warranties


  Promise made by business to correct product defects if:

  Product is faulty

  Product doesn't match description or sample

  Product isn't fit for purpose
• Ethical Marketing Practises


  Practises which go beyond regulation in the 'spirit of the law
• Marketing Code of Ethics

  Australian Association of National Advertisers Code of Ethics (2012) → Consumers can report unethical advertising to Advertisement standards Bureau

  -Product Placement

  -Materialism

  -Stereotypical depictions of gender

  -Sexual messages in marketing

  -Invasion of privacy

  -Sugging: Selling under the guise of market research/surveys
• Marketing Processes acronym


  Process of making marketing plan → SMEIDI
• Situational Analysis


  Process undertaken to understand the situation of the business and its products
• Swot Analysis


  Strengths and Weaknesses (internal), Opportunities and threats (external)
• Product Life cycle


  1.Introduction:Increasing customer awareness to build market share

  2.Growth: Increase market share and brand acceptance

  3.Maturity: Sales plateau as market saturates

  4.Post-maturity: Decline or renewal.
• Market research


  Process of systematically collecting, recording and analysing information concerning marketing problems.

  1.Determine Info needs:

  
  

  2.Collecting data: Primary or Secondary data

  
  

  a)Primary→ Collected from original source

  -Survey Method→ Direct contact (Personal interviews, surveys, etc)

  -Observation Method→No direct contact (Personal or electronic observation)

  
  

  b)Secondary→ Collected from business

  -Internal→ Collected by business (customer feedback)

  -External→ Published data (ABS reports)

  
  

  3.Data analysis and interpretation: Statistical data analysis→Identify average, typical and deviations

  a)Tabulate→ Present

  b)Cross-tabulate→ Compare

  c)Interpret→ Make judgement
• Marketing Objectives + Strategies undertaken to achieve the business' marketing objectives through the marketing mix

  Realistic and measurable goals achieved through marketing plan

  Common:

  Increase Market share

  Expand product range→ Increase mix of products offered to appeal to largest customer base

  Maximise Customer Services→ Improve customer satisfaction → Establishes reliable customer base

  
  

  Strategies undertaken to achieve the business' marketing objectives through the marketing mix:

  Product - determining quality, packaging, labelling

  Price - whether to set above, below or around competitor price

  Promotion - methods business use to inform, persuade customer to buy products

  Place - intermediaries and physical distribution
• Target Markets


  → Customer base business wishes to market towards.

  Primary: Segment majority of marketing resources dedicated to

  Secondary: Smaller and less important market segment