Marketing Management
Assignment: A
1) Define Marketing Management. Discuss the various management philosophies. Explain how the marketing and selling are contrasted and briefly explain the societal marketing concept.
Ans: Marketing management is the analysis, planning, implementation and control of programs designed to create, build, and maintain beneficial exchanges with target buyers for the purpose of achieving organizational organizational objectives. The various management philosophies are: a. The production concept : This concept is one of the oldest philosophies that guides sellers. The first occurs when the demand for a product exceeds the supply. The second situation occurs when the product’s cost is too high and improved productivity is needed to bring it down. b. The product concept : This concept holds that cosumers will favor products that offer the most quality, performance, and innovative features and that an organization should thus devote energy to making continuous product improvements. c. The selling concept : Many organizations follows the selling concept, which holds that consumers will not buy enough of the organization’s products unless it undertakes a large scale selling and promotion effort. d. The marketing concept : This holds that achieving organizational goals depends on determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiently than competitors do. The selling concept and the marketing concept are frequently misunderstood as same but they are two different concepts .The selling concept takes an inside-out perspective. It starts with the factory, focuses on the company’s existing products, and calls for heavy selling and promotion to obtain profitable sales. In contrast, the marketing concept takes an outside-in perspective. It starts with a well-defined market, focuses on consumer needs, co-ordinates all the marketing activities affecting customers, and makes profits by
creating customer satisfaction. Under the marketing concept, companies produce what consumers want, thereby satisfying consumers and making profits. The societal marketing concept holds that the organization should determine the needs, wants and interests of target markets. It should then deliver the desired satisfactions more effectively and efficiently than competitors in a way that maintains or improves the consumer’s and the society’s well being. The societal marketing concept is the five marketing management philosophies. Such concerns and conflicts led to the societal marketing concept. The societal marketing concept calls upon marketers to balance three considerations in setting their marketing policies: company profits, consumer wants, and society’s interests. Originally, most companies based their marketing decisions largely on short-run company profit. Eventually, they began to recognize the long-run importance of satisfying consumer wants, and the marketing concept emerged. Now many companies are beginning to think of society’s interests when making their marketing deci sions.
-----------------------------------------------------------------------------------------------------------2) Explain the various factors influencing a company’s marketing strategy with the help of suitable examples. Ans. Factors influencing compa ny’s marketing strategy: Marketing Channels
Marketing analysis
Product
Marketing
Marketing 0000 Target
Place Suppliers
Control
M Price Marketing
Pl
Customers Pl
anning Promotion Marketing Implementation
Planning
Public
Marketing Segmentation: The process of dividing a market into distinct groups of buyers with different needs, characteristics, or behavior who might require separate products or marketing mixes is called market segmentation. Market Targeting: Market Targeting involves evaluating each market seg ment’s attractiveness and selecting one or more segments to enter. Market Positioning: A product’s position is the place the product occupies relative to competitors in consumer’s minds. If a product is perceived to be exactly like another product on the market, consumers would have no reason to buy it. Market positioning: It is arranging for a product to occupy a clear, distinctive, and desirable place, in the minds of target consumers, relative to competing products. Marketing strategies for competitive advantage: To be successful, the company must do a better job than its competitors of satisfying target consumers. Thus, marketing strategies must be geared to the needs of consumers and also to the strategies of competitors. Based on its size and industry position, the company must decide how it will position itself relative to competitors in order to gain the strongest possible competitive advantage. Developing the marketing mix: Once the company has decided on its overall competitive marketing strategy, it is ready to begin planning the details of the marketing mix. The marketing mix is one of the major concepts in modern marketing. Product means the “goods and service” combination the company offers to the target market. Price is the amount of money customers have to pay to obtain the product. Place includes company activities that make the product available to target consumers. Promotion means activities that communicate the merits of the products and persuade target customers to buy it.
An effective marketing program blends all of the marketing mix elements into a coordinated program designed to achieve the company’s marketing objectives. The marketing mix constitutes the company’s tactical tool kit f or establishing strong positioning in target markets. Four Ps: Product, Price, Place and Promotion Four Cs: Customer needs and wants, cost to the customer, convenience and communication.
Managing the Marketing Effort:
ANALYSIS
Control
Planning Develop Strategic plans Develop marketing plans
Measure results Implementation Evaluate resultt Carry out the plan Take corrective action
Marketing Analysis: The Company must analyze its markets and marketing to find attractive opportunities and to avoid environmental threats. Marketing Planning: Marketing planning involves deciding on marketing strategies that will help the company attain its overall strategic objectives. Marketing Implementation : Planning good strategies is only a start toward successful marketing. A brilliant marketing strategy counts for little if the company fails to implement it properly. Marketing implementation is the process that turns marketing strategies and plans into marketing actions in order to accomplish strategic marketing objectives. Marketing Control: It is the process of measuring and evaluating the results of marketing strategies and plans and taking corrective action to ensure that marketing objectives are attained.
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2) What is marketing research? Discuss the marketing research process with the help of an example. Briefly explain the different sources of data.
Ans: Managers need information in order to introduce products and services that create value in the mind of the customer. But the perception of value is a subjective one, and what customers value this year may be quite different from what they value next year. As such, the attributes that create value cannot simply be deduced from common knowledge. Rather, data must be collected and analyzed. The goal of marketing research is to provide the facts and direction that managers need to make their more important marketing decisions. Marketing research covers a wider range of activities. While it may involve market research, marketing research is a more general systematic process that can be applied to a variety of marketing problems.
Once the need for marketing research has been established, most marketing research projects involve these steps: 1. 2. 3. 4. 5. 6. 7. 8.
Define the problem Determine research design Identify data types and sources Design data collection forms and questionnaires Determine sample plan and size Collect the data Analyze and interpret the data Prepare the research report
Defining the
Developing the
Implementing the
Interpreting and
problem and
research plan for
research plan ,
reporting the
research
collecting
collecting and
findings
objectives
information
analyzing the data
The different sources of data: SECONDARY DATA
Before going through the time and expense of collecting primary data, one should check for secondary data that previously may have been collected for other purposes but that
can be used in the immediate study. Secondary data may be internal to the firm, su ch as sales invoices and warranty cards, or may be external to the firm such as published data or commercially available data. The government census is a valuable source of s econdary data. Secondary data has the advantage of saving time and reducing data gathering costs. The disadvantages are that the data may not fit the problem perfectly and that the accuracy may be more difficult to verify for secondary data than for primary data. Some secondary data is republished by organizations other than the original source. Because errors can occur and important explanations may be missing in republished data, one should obtain secondary data directly from its source. One also should consider who the source is and whether the results may be biased. PRIMARY DATA
Often, secondary data must be supplemented by primary data originated specifically for the study at hand. Some common types of primary data are:
demographic and socioeconomic characteristics psychological and lifestyle characteristics attitudes and opinions awareness and knowledge - for example, brand awareness Intentions - for example, purchase intentions. While useful, intentions are not a reliable indication of actual future behavior. Motivation - a person's motives are more stable than his/her behavior, so motive is a better predictor of future behavior than is past behavior. behavior
Primary data can be obtained by communication or by observation. Communication involves questioning respondents either verbally or in writing. This method is versatile, since one needs only to ask for the information; however, the response may not be accurate. Communication usually is quicker and cheaper than observation. Observation involves the recording of actions and is performed by either a person or some mechanical or electronic device. Observation is less versatile than communication since some attributes of a person may not be readily observable, such as attitudes, awareness, knowledge, intentions, and motivation. Observation also might take longer since observers may have to wait for appropriate events to occur, though observation using scanner data might be quicker and more cost effective. Observation typically is more accurate than communication.
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3) What do you mean by productivity analysis? Differentiate between productivity analysis and profitability analysis. What are the different steps in the direct and indirect approaches to marketing budgeting?
Ans: Productivity analysis is the assessment of the sales or the market share consequences of a marketing strategy. Specifically, a productivity analysis involves the estimation of relationships between prices or one or more marketing expenditure (such as advertising budgets) and the sales volume or market share of a particular product or product line. Whereas profitability analysis is the assessment of the impact of marketing strategies and programs on the profit contribution that can be expected from a product or product line. STEPS IN THE DIRECT APPROACH TO MARKETING BUDGETING a. Develop an industry sales forecast(where feasible) b. Estimate the marketing share that will result from a given price and marketing expenditure level(if no industry sales are available, directly estimate company sales instead of market share) c. Calculate the expected company sales(market share X industry sales forecast) d. Calculate variable contribution(company sales X PVCM) e. Calculate total contribution(variable contribution margin less direct and traceable fixed costs included in proposed budget) f. Determine whether the sales, market share, and total contribution levels are acceptable given the product objectives
STEPS IN THE INDIRECT APPROACH TO MARKETING BUDGETING a. Establish the target level of total contribution. b. Calculate the level of sales required to achieve target total contribution for a given price and marketing expenditure level: (proposed total direct and traceable fixed costs plus target total contribution) divided by PVCM. c. Calculate the required market share: required level of sales divided by industry sales forecast. d. Based on estimated productivity of the proposed price and marketing expenditure, determine whether the required sales and market share can be achieved.
e. Determine whether the required market share and required sales will acceptable for the given product objectives. If not, determine whether the sa les or marketshare objectives can be reached with the proposed budget.
-----------------------------------------------------------------------------------------------------------5) Write short notes on any three of the following:
a) Competitive Parity Analysis : This approach relies on historical experiences but is designed to consider relative marketing effort explicitly. For example, when competing products are highly similar in quality, a manger may find a very high correlation between a product’s market share.
Its Share of industry advertising expenses
The number of sales calls made relative to competitors sales calls.
The relative number of retail accounts that carry the product.
The price of the product relative to the average industry price.
b) Basic elements of a marketing Strategy : Target market selection – All buyers in the relevant market, buyers in one or more segments. Type of demand to be stimulated – Primary demand, among new users, selective demand, in new served markets, among competitor’s customers a nd in current customer base.
c) Product Life Cycle
The product life cycle represents a pattern of sales over time, with the pattern typically broken into four stages. The four stages are usually defined as follows: a. Introduction: The product is new to the market. Because there are therefore no direct competitors, buyers must be educated about what the product does, how it is used, who it is for and where to buy it.
b. Growth: The product is now more widely known and the sales grow rapidly because new buyers enter the market. c. Maturity: Sales growth levels off as nearly all potential buyers have entered the market. Consumers are now knowledgeable about the alternatives, repeat purchasers; dominate sales and product innovations to minor improvements. d. Decline: Sales slowly decline because of changing buyer needs or because of the introduction of new products that are sufficiently different to have their own life cycles.
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Assignment: B 1) a) What do you mean by media scheduling? Explain the procedure for evaluating advertising programs with help of suitable examples.
Ans: An advertising’s success in achieving the advertising objectives depends largely on how well each show or magazine reaches buyers in the target market segment. Because the cost, audience, size and characteristics of each media alternative are generally known, managers can employ some quantitative tools in media scheduling. However, managers must also employ judgment in media scheduling decisions because some of the attributes of media are not easily measured.
Selecting the type of medium to use
Selecting specific vehicles for consideration
Determining the size, length and position of an advertisement
Determining the desired reach and frequent distribution of messages
Procedures for evaluating specific advertisements a. Recognition Tests: Estimate the percentage of people claiming to have read a magazine who recognize the ad when it is shown to them. b. Recall Tests: Estimate the percentage of people claiming to have read a magazine who can recall the ad and its contents. c. Opinion Tests: Potential audience members are asked to rank alternative advertisements as most interesting, most believable, best liked. d. Theatre Tests: Theatre audience is asked to brand preferences before ad and after an ad is shown in context of a TV show.
b) Define Sales promotion and discuss the different elements of promotion-mix with the help of suitable examples.
Ans: Sales promotion is any short-term offer or incentive directed toward buyers, retailers or wholesalers that is designed to achieve a specific, immediate response. The two basic classifications of sales promotion are consumer promotions, including coupons, free samples, premiums, and special exhibits and trade promotions, in which cash, merchandise, equipment, or other resources are awarded to retail or wholesale firms or to their personnel. There are seven main elements in a promotional mix. They are:
1. Advertising - Any paid form of non-personal communication through mass media about a service or product or an idea by a sponsor is called advertising. It is done through non personal channels or media. Print advertisements, advertisements in Television, Radio, Billboard, Broachers’ and Catalogs, Direct mails, In-store display, motion pictures, emails, banner ads, web pages, posters are some of the examples of advertising. Paid promotion and presentation of goods, services, ideas by a sponsor comes under the advertisement. 2. Personal Selling - This is a process by which a person persuades the buyer to accept a product or a point of view or convince the buyer to take specific course of action through face to face contact. It is an act of helping and persuading through the use of oral presentation of products or services. Target audience may vary
from product to product and situation to situation. In other words personal selling is a person to person process by which the seller learns about the prospective buyer's wants and seeks to satisfy them by making a sale. Examples: Sales Meetings, sales presentations, sales training and incentive programs for intermediary sales people, samples and telemarketing etc. It can be of face-to-face or through telephone contact. 3. Publicity: Non-personal stimulation of demand for a product, service or business unit by generating commercially significant news about it in published media or obtaining favorable presentation of it on radio, television or stage. Unlike advertising, this form of promotion is not paid for by the sponsor. Thus, publicity is news carried in the mass media about an organization, its products, policies, actions, personnel etc. It can originate with the media or the marketer, and is published or broadcast at no charge for media space and time. Examples: Magazine and Newspaper articles/reports, radio and television presentations, charitable contributions, speeches, issue advertising, and seminars. Publicity can be favorable (positive) or unfavorable (Negative). The message is in the hands of media and not controlled by the organization/firm. 4. Sales promotion - is any activity that offers an incentive for a limited period to obtain a distribution, fliers etc.desired response from the target audience or intermediaries which includes wholesalers and retailers. It stimulates consumer demand, market demand and improves product availability. Examples: Contests, product samples, Coupons, sweepstakes, rebates, tie-ins, self-liquidating premiums, trade shows, trade-ins, and exhibitions. 5 Corporate image - It is important to create a good image in the sight of general public as the Image of an organization is a crucial point in marketing. If the reputation of a company is bad, consumers are less willing to buy a product from this company as they would have been, if the company had a good image. 6 Exhibitions: Exhibitions provide a chance to try the product by the customers. It is an avenue for the producers to get an instant response from the potential consumers of the products. 7 Direct Marketing is reaching the customer without using the traditional channels of advertising such as radio, newspaper, television etc. This type of
marketing reaches the targeted consumers with techniques such as promotional letters, street advertising, and catalogue.
------------------------------------------------------------------------------------------------2) Discuss the marketing plan for a consumer product of your choice and briefly explain the marketing planning process.
