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1

provide an overview of marketing and the marketing process

Marketing is a philosophy or a way of doing business that puts the market — the customer, client, partner and society, and competitors — at the heart of all business decisions. The marketing process is cyclical in nature and involves understanding the market to create, communicate and deliver an offering for exchange. Marketers start by understanding the consumers, the market and how they are currently situated. Armed with this understanding, marketers are next tasked with creating solutions, communicating the offering to the market, and delivering it at a time and place that is convenient for the customer.

2

discuss the importance of ethics and corporate social responsibility in marketing

The essence of marketing is to develop mutually beneficial exchange. Exchange involves value creation for all parties to the exchange. Marketers must understand how customers perceive value. Value perceptions vary from one individual to another and they are ever changing. The customer is the focus of all marketing activities and successful marketers are those who view their products in terms of meeting customer needs and wants.

3

explain the elements of the marketing mix

A product is a bundle of attributes that when exchanged have value for customers, clients or society. A product can be a good, a service, an idea or even a person. Products cater to needs and wants. Needs are day-to-day survival requirements, while wants are desired but not required for survival.

Price is the amount of money a business demands in exchange for its offerings. Pricing is a complex marketing decision that must take account of many factors, including production, communication and distribution costs, required profitability, partners’ requirements, competitors’ prices, and customers’ willingness to pay. Marketers need to understand the relationship between price and quality to understand value from a customer’s point of view. Marketers need to understand what customers would like to receive and what they are prepared to give in return.

Distribution or place refers to the means of making the offering available to the target market at the right time and place while managing the costs of making the products available. Many businesses sell their products directly to the public, but distribution usually also involves partners such as wholesalers and retailers.

Promotion describes the marketing activities that make potential customers, partners and society aware of and attracted to the benefits of a business’s products. The product might be already established, modified, new, or information designed to persuade. Promotional activities include advertising, direct selling, sales promotions and loyalty schemes.

In the marketing framework, ‘people’ refers to all the people that may meet the customer and affect their experience of the product. Like the other factors, the people must be managed to maximise value for the customer.

Process refers to the systems used to create, communicate, deliver and exchange an offering.

Physical evidence refers to the tangible cues and physical environment a marketer can provide to help potential customers evaluate service quality.

4

discuss how marketing improves business performance, benefits society and contributes to quality of life

Organisations with a market orientation perform better than other organisations. Marketing creates employment and wealth for the benefit of individuals and society. It improves people’s quality of life through better products and the promotion of consumer and social welfare. An understanding of marketing helps you make better decisions as to the relative value of products offered to you. Marketing can be a rewarding career path. While it can be lucrative work, it requires dedication and effort. Marketers need good analytical, communication, and negotiation skills, the power of persuasion, and often a tertiary qualification in marketing or a related discipline.

5

describe the marketing environment and the purpose of environmental analysis

The marketing environment refers to all of the internal and external forces that affect a marketer’s ability to create, communicate, deliver and exchange offerings of value. Marketers seek to understand, respond to, and influence their environment. They use environmental analysis to break the marketing environment into smaller parts in order to better understand it

6

explain the factors at work in the organisation’s internal environment

The internal environment refers to its parts, people and processes. An organisation is able to directly control the factors in its internal environment. A thorough understanding of the internal environment ensures that marketers understand the organisation’s strengths and weaknesses, which positively and negatively affect the organisation’s ability to compete in the marketplace.
Different parts of organisations often have different goals. The most successful organisations manage to align the goals of each part of the organisation to the overall market orientation of the business. This is most likely to occur when each person and department understands their contribution and the contribution of other departments

7

understand the importance of the different micro-environmental factors

The micro environment consists of customers, clients, partners, competitors and other parties that make up the organisation’s industry. The organisation cannot directly control its micro environment, but it can exert some influence over it.
Marketers must understand and respond to the current and future needs and wants of their target market. They must understand how each of their partners’ processes work and how their partnerships benefit each party. They must also understand the risks involved in working with partners and the relative power balance between the organisation and each partner. Suppliers are a particularly crucial partner. Marketers must identify, assess, monitor and manage risks to supplies and risks to the price of supplies. To succeed, marketers must ensure their offerings provide their target market with greater value than their competitors’ offerings. Thus, marketers seek to understand their competitors’ marketing mix, sales volumes, sales trends, market share, staffing, sales per employee and employment trends. Marketers should analyse total budget competition, generic competition, product competition and brand competition

8

outline the different types of macro-environmental forces

The macro environment encompasses uncontrollable factors outside of the industry: political, economic, sociocultural, technological, environmental and legal forces. Political forces describe the influence of politics on marketing decisions. Economic forces affect how much money people and organisations can spend and how they choose to spend it. Sociocultural forces affect people’s attitudes, beliefs, behaviours, preferences, customs and lifestyles. Technological forces are those arising from the search for a better way to do things. Technology changes the expectations and 72behaviours of customers and clients as well as how organisations work with their partners and within society. There is a wide range of environmental factors that companies need to be mindful of, including ecological and environmental aspects such as weather, climate and climate change. Laws and regulations are closely tied to politics and establish the rules under which organisations must conduct their activities. The most significant laws and regulations for marketers are related to privacy, fair trading, consumer safety, prices, contract terms and intellectual property

9

conduct a preliminary situation analysis

Situation analysis involves assessing an organisation’s current position and situation. Together with organisational objectives, situation analysis is used as the platform for marketing planning. Essentially, a marketing plan communicates how marketers plan to get from the current situation to where senior management thinks their organisation should be.
Marketing metrics are used to measure current performance and the outcomes of past activities. A SWOT analysis is used to identify strengths (those attributes of the organisation that help it achieve its objectives), weaknesses (those attributes of the organisation that hinder it in trying to achieve its objectives), opportunities (factors that are potentially helpful to achieving the organisation’s objectives) and threats (factors that are potentially harmful to the organisation’s efforts to achieve its objectives)

10

discuss the importance of market research as a basis for marketing decision making

Market research links customers, clients, partners and society at large with the marketer through information. Information obtained from market research — along with information from other sources — is used to inform marketing decisions on a wide range of issues, including those that are fundamental to the organisation’s marketing mix. The results of market research are fed into a marketing information system, which holds and organises all of the organisation’s marketing information.

In deciding to undertake a market research project, the organisation should first consider whether the market research will be relevant, timely, feasible given available resources, necessary, and result in sufficient benefits to justify the costs.

Market research must be conducted ethically, respecting the rights of clients, employers and research participants.

11

clearly define a research problem to guide a market research project, and prepare a research brief

Before beginning a market research project, it is crucial to know precisely what the research is intended to achieve. The question that the research is intended to answer is known as the ‘research problem’. As the research project proceeds and more information is gathered, the research problem may need to be redefined.

Whether the market research project is undertaken in-house or outsourced to a specialist provider, a market research brief should be prepared to guide the project. A market research brief specifies the research problem, the information required, the timeframe, the budget, and any other conditions relevant to the project.

12

outline the issues in research design, including the role of primary and secondary data, and the uses of quantitative and qualitative research

The research problem needs to be analysed in order to create a methodology that will provide an answer to the problem. This detailed methodology planned to answer the research problem is known as the ‘research design’.

Depending on the nature of the research problem, market research usually takes the form of exploratory research, descriptive research or causal research. Exploratory research is intended to gather more information about a loosely defined problem. Descriptive research is used to solve well-defined problem by discovering more about certain phenomena. Causal research tests whether a particular variable affects a specific outcome.

Market research can draw on two types of data. Secondary data is data that already exists. Primary data is collected specifically for the purposes of the current research project.

Research methods can be broadly classified as quantitative research or qualitative research. Quantitative research collects data that can be represented numerically and analysed using statistical techniques. Experimentation, observation and biometrics are among the quantitative research methods. The most commonly used quantitative research tool is the survey, with online being the most popular current form.

Qualitative research obtains rich, deep and detailed information and is often used when the market researcher needs to know about the beliefs and attitudes that underlie observable behaviour. Interviews and focus groups are among the most 109commonly used qualitative research methods, but they are time-consuming and expensive. Both can be conducted in person, over the phone or online.

Market research tries to find out about the population by studying a small part of it and then generalising the results. The smaller part is known as a ‘sample’. Probability sampling ensures every member of a population has a known chance of being selected in the sample that will be studied. Non-probability sampling provides no way of knowing the chance of a particular member of the population being chosen as part of the sample.

13

understand the key principles of data collection and analysis, and the subsequent reporting of market research findings to inform marketing decisions

Once a research project has been designed, it must be implemented in compliance with the design. This requires careful project management. Data must be collected, filtered and organised so that it can be efficiently analysed. Quantitative data can be statistically manipulated to identify trends and patterns in the data. Qualitative data can be reduced to allow statistical analysis, but much of the rich detail can be lost. Often qualitative data analysis leads to further research in the form of quantitative research.

Data analysis allows conclusions to be drawn and recommendations formulated. The findings and recommendations of the market research project should be presented in a concise and clear manner. The underlying detail should also be provided to support the recommendations.

The recommendations ultimately lead to a marketing decision, which in turn will lead to marketing outcomes. Ideally, the outcomes are a successful response to the research problem that triggered the market research process.

14

explain why marketers require a thorough understanding of consumer behaviour and its major influences

‘Consumer behaviour’ is the study of the behaviour of individuals and households who buy products for personal consumption. It forms the basis of an understanding of the reasons behind the decisions consumers make, which is central to creating an effective marketing mix. Consumer behaviour is influenced by situational factors, group factors and individual factors.

Situational factors are simply the circumstances in which a person finds themselves when making a consumption decision. They relate to the influence of physical, social, time, motivational and mood factors.

15

understand the major group factors that influence consumer behaviour

Group factors comprise cultural influences and social influences. Cultural influences affect behaviours that operate at the level of the whole society or of major groups within society, and include culture, subculture and social class. Culture is the system of knowledge, beliefs, values, rituals and artefacts by which a society or other large group defines itself. National cultures can be described according to Hofstede’s cultural dimensions: power distance, uncertainty avoidance, individualism, masculinity and long-term orientation. A subculture is a group of individuals who share common attitudes, values and behaviours that distinguish them from the broader culture in which they are immersed. A social class is a grouping defined by similar social ranking within the social hierarchy.

Social influences are those that impinge on the individual to behave in a way that reflects group norms. A reference group is any group to which an individual looks for guidance, including membership, aspirational and dissociative reference groups. Within a reference group, some individuals take on the role of opinion leader on issues about which they are particularly knowledgeable. Opinion leaders are influential over the attitudes and behaviours of other group members. Family influences are also important in consumer behaviour and many consumption decisions are traditionally made by particular members or combinations of members of the household.

16

analyse the major individual factors that influence consumer behaviour

Personal and psychological factors influence consumer behaviour independently of social circumstances. Personal characteristics include demographic, lifestyle and personality factors. Marketers consider all of them to have a close link to consumer behaviour, but it has proven notoriously difficult to demonstrate a reliable and predictable link between particular personal characteristics and consumer behaviour.

Psychological characteristics are internal factors that shape the thinking, aspirations, expectations and behaviours of the individual. They include motivation, which is the internal drive to satisfy unfulfilled needs. According to Maslow’s hierarchy of needs, individuals, generally, try to satisfy lower order needs such as food and sleep ahead of higher order needs such as learning. Another psychological characteristic is perception, which describes how an individual filters, organises and attributes meaning to external stimuli, including marketing communications. Beliefs and attitudes are also an important personal influence on consumer behaviour, as they 147determine the context in which product evaluations are made. Effective marketing needs to appeal to the cognitive, affective and behavioural components of consumer attitudes. A final personal influence is the way in which an individual learns. Marketers can ‘teach’ individuals to have particular awareness of and attitudes towards their products using cognitive and behavioural learning approaches.

17

explain the general steps in the consumer decision-making process

The consumer decision-making process typically comprises need/want recognition, information search, evaluation of options, purchase and post-purchase evaluation. These steps are common to most purchase decisions, but the extent to which each is used depends on the level of involvement in the purchase. Habitual purchases are made with little decision-making involvement; infrequent, but familiar, purchases are made with limited involvement; and rare, large, important or risky purchases are made with extensive involvement.

It is a common mistake for marketers to overlook the last stage of the decision-making process: post-purchase evaluation. It is after the purchase that the consumer can evaluate whether or not they made a wise choice. Effective marketers take steps to ensure they continue to build their relationship with consumers after the purchase to reduce cognitive dissonance (second thoughts about the purchase) and increase the likelihood of repeat purchase and brand loyalty in the future.

18

understand the objectives that guide pricing strategies

Price is a visible expression of the value of the product to be exchanged and enables buyers and sellers to negotiate and agree on that value. Pricing objectives are derived from the organisation’s broader marketing objectives. Pricing objectives tend to focus on the issues of profitability, long-term prosperity, market share and positioning. The pricing strategy and specific tactics an organisation chooses must comply with laws and regulations that govern issues such as misleading and deceptive conduct, price collusion, comparability of prices, clarity in pricing and price discrimination. Ultimately, pricing decisions must be based on an understanding of demand, costs and competition in order to deliver value to the customer and the marketer

19

analyse demand to inform the development of an appropriate pricing strategy

Demand is the relationship between the price of a particular product and the quantity of the product that consumers are willing to buy. Demand analysis is based on historical data, estimates of sales potential, and estimates of price–volume relationships and price sensitivity. The data enable the marketer to construct a demand curve. The traditional demand curve slopes downwards, indicating that as prices rise, quantity sold falls, and vice versa. Prestige products have a unique demand curve in which, up to a threshold point, increasing prices actually increases demand due to the perceived quality, prestige and exclusivity conveyed by the product’s price. The sensitivity of consumer demand to price changes is known as the price elasticity of demand. In instances of price elastic demand, a particular percentage change in price will cause a greater percentage change in quantity demanded. In price inelastic demand, a particular percentage change in price will cause a smaller percentage change in quantity demanded.

20

describe the principles of pricing based on cost and revenue analysis

Costs determine a price floor, below which the business cannot survive in the long term. It is crucial for marketers to understand the relationship between retail prices, sales volume, costs and ultimately profits. Break-even analysis estimates the volume of unit sales required to cover total costs. Marginal analysis determines the effect on costs and revenue when an organisation produces and sells one more unit of product. Cost-based pricing involves adding a percentage or dollar amount to the cost of a product in order to determine its selling price. Cost-plus pricing is used by producers when it is difficult to determine the costs of the product until it has been completed. In such cases, the seller adds their required profit margin as a dollar amount or percentage to the costs once the project is complete. Markup pricing is used by wholesalers and retailers and involves adding a percentage of their purchase cost to determine the resale price.

21

explain the role of competitive analysis in determining pricing

Price competition usually emerges when competitors’ offerings are not significantly differentiated in the minds of consumers. Price competition is undesirable from a seller’s point of view, unless the seller has a cost advantage through economies of scale in purchasing or low-cost production. Competition-based pricing is based on the prices charged by competitors or on the likely response of competitors to the organisation’s prices. When it is feasible, competition on factors other than price is preferable as it gives the organisation greater power to decide on the profit margin per unit sold. Most organisations seek to compete using a strategy of ‘differentiation’, which emphasises the uniqueness of the organisation’s products in terms of product quality, innovation, brand image, customer service, distribution coverage and local convenience.

22

appreciate the issues involved in pricing for business markets

Business-to-business marketing relationships tend to be close, long-term and formal. This leads to more formal pricing practices than those in consumer markets. At the same time, pricing is more complex in business markets — differences in the size of purchases, the frequency of purchases, costs involved in transport and other considerations often require sellers to adjust prices for individual customers and individual transactions.

23

understand how to manage prices as part of the marketing mix

Customer perceptions are subjective and particular to each individual, but it is important that marketers match pricing as closely as possible to customers’ expectations. These expectations are based partly on the customer’s internal and external reference prices. Tactics such as odd–even pricing, reference pricing, multiple-unit pricing and bundle pricing can be used to manage customer perceptions of value. In launching a new product, an organisation may choose a penetration pricing or price skimming strategy to maximise volume or margin respectively. For established products, an organisation may seek to implement differential pricing or promotional pricing. Pricing should always be consistent with the other elements of the marketing mix.

24

define ‘product’ and understand different ways to view and analyse products and product attributes

A product is a good, service or idea offered to the market for exchange. It can be tangible, intangible or a combination of both. Marketers can better understand and analyse products using the total product concept, which describes four levels of a product: core product, expected product, augmented product and potential product. Products can be classified as consumer products (products purchased by individuals to satisfy personal and household needs) and business products (products bought by an organisation to be used in its operations or in the production of its own products).

25

describe the product life cycle, new product development and the product adoption process

The concept of product life cycle proposes that a product passes through five stages: new product development, introduction, growth, maturity and decline. Products must be managed throughout the product life cycle to maximise their contribution to the organisation’s marketing objectives.

New product development has eight stages: idea generation, screening (eliminating unviable ideas), concept evaluation, marketing strategy, business analysis (how the new product will affects costs, sales and profits), product development, test marketing and commercialisation.

The product adoption process describes the stages through which a potential customer passes, from first becoming aware of the new product right through to deciding to adopt, or buy, the product. In this process the consumer who accepts a new product passes through five stages: awareness, interest, evaluation, trial and adoption.

26

outline how an organisation can differentiate its products to obtain a competitive advantage

Product differentiation is the creation of products and product attributes that distinguish one product from another. Most of the differentiation of products occurs in the augmented product layer of the total product concept. Design, brand image, style, add-on services, quality and features are the major product attributes that can be used to differentiate offerings from competitors’ products.

27

explain the value of branding and the major issues involved in brand management

Brand refers to a collection of symbols, such as the name, logo, slogan and design intended to create an image in the customer’s mind that differentiates a product from competitors’ products. Brands can play a major role in a consumer’s choice of a product, particularly for high-involvement products, as a well-known brand with a good reputation will more likely be chosen than a cheaper, unknown brand. A brand can help speed up consumer decision making by identifying specific preferred products, and can provide a form of self-expression and status, as well as denoting product quality. Brand equity is broadly defined as the added value that a brand gives a product. It is underpinned by brand loyalty. Brand equity metrics include brand assets (e.g. trade marks and patents), stock price analysis, replacement cost, brand attributes, brand loyalty and willingness-to-pay analysis. A high brand equity can be a valuable asset for a company and provide a strong competitive advantage.

28

describe the functional and marketing roles of packaging

Packaging can be a very important part of a product. The main functions of a package are to protect the product and promote the product. Many products need some kind of packaging to make it more convenient to store and use while protecting it from waste, damage or spoilage. However, as well as its functional features, a package is also used as a marketing tool to gain people’s attention at the retailer, make customers aware of the product and/or its contents, differentiate it from competitors’ offerings and help build a particular message or image about the product. As a form of marketing tool, the package can be changed. Marketers may want to change the package to express to customers that the product has changed in some way such as in terms of shape or ingredients, update the style of package or logo to broaden the customer appeal, or emphasise certain elements to further differentiate it from the competition.

29

explain key aspects of product management and positioning through the product life cycle

Within an organisation, the marketing issues surrounding products can be managed through a functional approach or by using product managers, brand managers or market managers. The last three approaches are often better able to coordinate all of the activities across the organisation to ensure the product strategy is implemented well. In addition to introducing new products, an organisation can capitalise on existing products by modifying products or creating line extensions.

The organisation needs to manage the positioning of the product in the marketplace, and it may sometimes be necessary to reposition the product during the product life cycle. Line extensions, product upgrades and repositioning can all help keep a product out of the decline phase. For some products, these approaches can move the product back in the life cycle to enjoy a new phase of growth.

Many products eventually become obsolete. A product in decline may be taking valuable resources from away from other opportunities. Product deletion is the process of eliminating a product from the product mix. Product deletion must be managed in such a way as to minimise discontent among customers of the deleted product. Otherwise the discontent can affect sales of continuing products.

30

understand the objectives that guide pricing strategies

Price is a visible expression of the value of the product to be exchanged and enables buyers and sellers to negotiate and agree on that value. Pricing objectives are derived from the organisation’s broader marketing objectives. Pricing objectives tend to focus on the issues of profitability, long-term prosperity, market share and positioning. The pricing strategy and specific tactics an organisation chooses must comply with laws and regulations that govern issues such as misleading and deceptive conduct, price collusion, comparability of prices, clarity in pricing and price discrimination. Ultimately, pricing decisions must be based on an understanding of demand, costs and competition in order to deliver value to the customer and the marketer.

31

analyse demand to inform the development of an appropriate pricing strategy

Demand is the relationship between the price of a particular product and the quantity of the product that consumers are willing to buy. Demand analysis is based on historical data, estimates of sales potential, and estimates of price–volume relationships and price sensitivity. The data enable the marketer to construct a demand curve. The traditional demand curve slopes downwards, indicating that as prices rise, quantity sold falls, and vice versa. Prestige products have a unique demand curve in which, up to a threshold point, increasing prices actually increases demand due to the perceived quality, prestige and exclusivity conveyed by the product’s price. The sensitivity of consumer demand to price changes is known as the price elasticity of demand. In instances of price elastic demand, a particular percentage change in price will cause a greater percentage change in quantity demanded. In price inelastic demand, a particular percentage change in price will cause a smaller percentage change in quantity demanded.

32

describe the principles of pricing based on cost and revenue analysis

Costs determine a price floor, below which the business cannot survive in the long term. It is crucial for marketers to understand the relationship between retail prices, sales volume, costs and ultimately profits. Break-even analysis estimates the volume of unit sales required to cover total costs. Marginal analysis determines the effect on costs and revenue when an organisation produces and sells one more unit of product. Cost-based pricing involves adding a percentage or dollar amount to the cost of a product in order to determine its selling price. Cost-plus pricing is used by producers when it is difficult to determine the costs of the product until it has been completed. In such cases, the seller adds their required profit margin as a dollar amount or percentage to the costs once the project is complete. Markup pricing is used by wholesalers and retailers and involves adding a percentage of their purchase cost to determine the resale price.

33

explain the role of competitive analysis in determining pricing

Price competition usually emerges when competitors’ offerings are not significantly differentiated in the minds of consumers. Price competition is undesirable from a seller’s point of view, unless the seller has a cost advantage through economies of scale in purchasing or low-cost production. Competition-based pricing is based on the prices charged by competitors or on the likely response of competitors to the organisation’s prices. When it is feasible, competition on factors other than price is preferable as it gives the organisation greater power to decide on the profit margin per unit sold. Most organisations seek to compete using a strategy of ‘differentiation’, which emphasises the uniqueness of the organisation’s products in terms of product quality, innovation, brand image, customer service, distribution coverage and local convenience.

34

appreciate the issues involved in pricing for business markets

Business-to-business marketing relationships tend to be close, long-term and formal. This leads to more formal pricing practices than those in consumer markets. At the same time, pricing is more complex in business markets — differences in the size of purchases, the frequency of purchases, costs involved in transport and other considerations often require sellers to adjust prices for individual customers and individual transactions.

35

understand how to manage prices as part of the marketing mix

Customer perceptions are subjective and particular to each individual, but it is important that marketers match pricing as closely as possible to customers’ expectations. These expectations are based partly on the customer’s internal and external reference prices. Tactics such as odd–even pricing, reference pricing, multiple-unit pricing and bundle pricing can be used to manage customer perceptions of value. In launching a new product, an organisation may choose a penetration pricing or price skimming strategy to maximise volume or margin respectively. For established products, an organisation may seek to implement differential pricing or promotional pricing. Pricing should always be consistent with the other elements of the marketing mix.

36

explain promotion (marketing communication) and its role in the marketing mix

Promotion (or marketing communications) is the creation and maintenance of communication with target markets. In marketing, promotion is usually thought of as comprising a strategic mix of advertising, public relations, sales promotions and personal selling. Promotion is an extremely important part of the marketing mix: it makes consumers aware of and interested in the product on offer. It is crucial that marketers effectively and efficiently communicate their message about their product to the marketplace. Promotion often sends messages about the other parts of the marketing mix: the product, pricing and distribution.

37

understand the integrated marketing communications approach to marketing promotion and the major elements of the promotion mix

Integrated marketing communications (IMC) describes the coordination of promotional efforts to maximise their effectiveness. The goal of IMC is to consistently send the most effective possible message to the target market. The four main components of IMC are advertising, public relations, sales promotion and personal selling. With a basic understanding of each component of the promotion mix and some of their relative strengths and weaknesses, a manager can consider how they are chosen and combined. The most effective choice and mix of promotion elements will vary with the specific goals of the marketing effort, individual product characteristics, individual target market characteristics, the nature of the marketing organisation itself, and the resources and budget available to the marketer.

38

describe different types of advertising and the steps in creating an advertising campaign

Advertising is the paid promotion of a business, products and brands to a mass audience using traditional mass media such as television, radio and newspapers, signage, and emerging media such as mobile phone networks. Within the IMC strategy, the overall advertising plan is known as the advertising campaign. Any decisions about advertising should be made in the context of an IMC approach. The key steps in creating an advertising campaign are: understand the market environment; know the target market; set specific objectives; create the message strategy; allocate resources; select media; produce the advertisement; place the advertisement; and evaluate the campaign.

39

outline the role of public relations in promotion

Public relations describes promotional efforts designed to build and sustain good relations between an organisation and its stakeholders. Stakeholders include customers, employees, neighbours, shareholders, regulators, governments, competitors, the media and society in general. In contrast to advertising, which often promotes products, brands or the organisation through direct paid communications in the media, public relations uses written materials, sponsorships, giveaways, good deeds and other ways to generate positive publicity and goodwill towards the organisation. Public relations is also used reactively to counter poor publicity or as a part of crisis management. The main outcome of public relations is publicity. Publicity is the exposure a marketing organisation receives when it obtains free coverage in the media.

40

explain how sales promotion activities can be used

Sales promotions are short-term activities designed to encourage consumers to purchase a product or encourage resellers to stock and sell a product. Sales promotions offer some extra benefit or incentive above and beyond the intrinsic value of the product. Sales promotion can be directed at the final consumer (consumer promotions) or to those in the marketing channel (trade promotions). Sales promotion methods aimed at the consumer include: free samples, premiums, loyalty programs, contests, coupons, discounts, refunds, rebates; point of purchase promotions; and event sponsorships. Trade promotions include trade allowances, gifts and premium money, cooperative advertising and dealer listings.

41

understand the nature of personal selling

Personal selling is personal communication with consumers to persuade them to buy products. Personal selling is the most expensive form of promotion as it requires the full dedication of a salesperson to a customer, but it does have strong advantages, in particular that the salesperson can tailor the promotion to the customer’s needs. Salespeople play a very important role for some companies and are the public face of the business. Many marketing organisations manage the personal selling process by using the INPLCF model, which stands for Information, Needs, Product, Leverage, Commitment/close and Follow-up. In managing the sales force, the sales manager needs to establish sales force objectives and targets; determine the appropriate size and location of the sales force; recruit salespeople; train salespeople; compensate salespeople; and monitor and motivate performance.

42

discuss a range of marketing communication options additional to the traditional promotion mix

There are many promotional methods available to an organisation in addition to advertising, public relations, sales promotion and personal selling. Sponsorship is the paid association of a brand with an event or person. A company develops a sponsorship relationship with a particular event, providing financial support in return for the right to display a brand name, logo or advertising. Ambush marketing is the presentation of marketing messages at an event that is sponsored by an unrelated business or even a competitor, and can be extremely successful. Product placement is the paid inclusion of products in movies, television shows, video games, songs and books. Guerilla marketing refers to highly creative, aggressive and unconventional marketing approaches, most commonly used by small businesses that cannot afford large-scale marketing efforts. Viral marketing is the use of electronic social networks to spread a marketing message from one person to another. Permission marketing is where activities are centred around obtaining customer consent to receive information and marketing material from a company.

43

understand the concept of place and how distribution channels connect producers and consumers/organisational buyers

The concept of ‘place’, or distribution, involves the way products can be eventually ‘placed’ in the hands of the final consumer through a supply chain between producers and consumers (or organisational buyers in the case of business-to-business markets). The chain of distribution is known as a distribution channel. The key organisations in the marketing channel, or intermediaries, include wholesalers, industrial buyers, agents or brokers, and retailers. Marketing intermediaries are useful and necessary when they can more efficiently connect producers with their customers than can the producers themselves. Even if a producer can manage to get their product directly to end users, they are often better off to concentrate on their core abilities (production) and rely on specialist intermediaries who can more efficiently move the product closer to customers. Because they have expertise, equipment, experience, contacts, skills and scales of economy, intermediaries help producers achieve better results than producers can achieve when acting alone.

44

describe the major activities involved in the distribution of services

Services products are usually produced at the time of consumption and so the notion of ‘service distribution’ is quite different to physical distribution. However, physical distribution is required for the physical inputs used in producing and delivering the service product, some services are delivered using infrastructure, and service businesses must ensure that the labour is available at the right time and the right quantities to ensure customers can be served.

45

understand the major aspects of retailing

Retailing describes any exchange in which the buyer is the ultimate consumer of the product. Distribution channel intermediaries that are primarily concerned with retailing are called ‘retailers’. Retailers provide customers with time utility, place utility, form utility, advice and personal service, and exchange efficiencies. There is an enormous range of retailers, including general-merchandise retail stores, specialty retail stores, online retailers and numerous others.

46

explain the role of agents and brokers in the distribution channel

Agents and brokers bring together other participants in the distribution channel. Agents are engaged by buyers or sellers on an ongoing basis to represent them in negotiations with other distribution channel participants. The main types of agents are manufacturers’ agents, selling agents, buying agents and commission merchants. Brokers, on the other hand, are engaged on a short-term or one-off basis to negotiate on behalf of buyers or sellers. They have a more limited role than agents, but their value is in their specialist knowledge and well-established contacts in the industries in which they work.

47

explain the role of wholesalers in marketing distribution

Wholesaling comprises exchanges in which products are bought for resale, for use as inputs in other products, or for some other use in a business. Wholesaling does not include transactions with end consumers. Wholesalers tend to deal in large volumes of product in each transaction. Wholesalers offer benefits to the producer by acting as a salesforce, promoting and selling its products to retailers; holding and managing inventory, relieving the producer’s warehousing and transport burden; assuming the risk when retailers are given products on credit; providing cashflow by paying for and taking possession of inventory shortly after it is produced; and communicating market issues to the producer and retailers. For the retailer, wholesalers can manage distribution; help choose and source appropriate inventory; have bulk buying power and the ability to negotiate good deals with producers; provide access to a wide range of goods through one business partnership; can provide sophisticated technology solutions to manage ordering; can provide credit; and communicate market and retail issues to producers.

48

identify digital marketing activities

Digital marketing (e-marketing) refers to all of the activities involved in planning and implementing marketing in the electronic environment, including the internet and web, mobile phones and other information and telecommunications technologies. Examples of digital marketing include the sale of products or providing marketing information via a website, texting and email. A key consumer advantage is convenience: they are not limited by the usual store opening hours, the location of the store or having to wait while other customers are served. Among the disadvantages are the inability to physically examine the product before making the purchase and the risk of credit card fraud. Marketing organisations are potentially exposed to much greater competition online, but they also have access to the entire global market. Digital marketing allows consumers to interact deeply with the marketing organisation without the need for dealing with an actual person.

49

explain the unique characteristics of digital marketing

A number of key characteristics of digital marketing differentiate it from other forms of marketing: profiling, interactivity and community, control, accessibility and comparability, and digitalisation. Profiling is the process of getting to know about potential customers before they make a purchase and to find out more about existing customers. Interaction is the ongoing exchange of information between marketer and customer (or potential customer); an online community provides a virtual meeting place for customers and potential customers. Control is the ability of the customer to determine how they interact with the marketing message and to influence the presentation and content of the marketing message. Accessibility is shown by the web providing individuals with information 24/7, while comparability means that access to a variety of websites enables the individual to compare products, brands and options, and seek the opinions of others. Digitalisation is the ability to deliver a product as information or to present information about a product digitally.

50

explain specific digital marketing methods

A popular digital marketing approach is online advertising, which includes banner advertisements appearing on websites and pop-up advertisements that open in a new web browser window. Brochure sites are websites that are essentially an online advertisement for the organisation which present product and contact details, but offer little other functionality. Social media describes the various mobile and online websites using technologies and experiences that involve online communities where members contribute to and build the community and the content, and where users can substantially control their own online experience through customisation and interactivity. Viral marketing is the use of social networks to spread a marketing message from one person to another. A web portal is designed to act as a gateway to other related sites. Search engine optimisation (SEO) means tailoring certain features of a website to achieve the best possible ranking in search results returned by a search engine. Search engine marketing is paid advertising that appears similarly to a search result on a search engine page. E-commerce involves marketing exchanges that take place online.

51

appreciate ethical and legal issues relating to digital marketing

Digital marketing raises many ethical and legal issues due to the pervasive nature of telecommunications technologies, the personalised and interactive nature of digital marketing, the international, cross-border nature of telecommunications, and the failure of laws and international agreements to keep pace with technological change and the innovative use of new technologies. The main themes in ethics and law surrounding digital marketing are privacy, misleading or deceptive conduct, spam, intellectual property rights, consumer protection and technology burnout.

52

discuss the role of digital marketing in an overall marketing strategy

An organisation’s marketing strategy should be a cohesive whole designed to achieve the organisation’s overall goals. Therefore, any digital marketing strategy will be part of, and consistent with, a broader organisational marketing strategy. Many of the issues to be considered in a digital marketing strategy are the same as those considered in formulating the overall marketing strategy and marketing plan. In formulating a digital marketing strategy, consideration must be given to how e-activities affect target markets, the marketing mix (product, price, promotion, distribution), and evaluating campaign effectiveness. In particular, customer relationship management (CRM) focuses on using information about customers to produce digital marketing experiences that create, build and sustain long-term relationships.

53

explain the relationship between the marketing cycle and marketing management

The marketing cycle is the cyclical process of understanding, creating, communicating and delivering value, refined by continuous evaluation. The management task of building market understanding, and planning, implementing and evaluating marketing activities is known as marketing management. Marketing management aims to ensure that the organisation achieves its marketing objectives by maximising the value obtained from the marketing exchange — for the organisation itself and its customers, client, partners and society at large.

54

understand the importance of effective marketing planning in achieving organisational and marketing objectives

Organisations with a marketing philosophy perform better for their stakeholders — they offer more value to customers and clients, better financial returns to partners and owners, and more benefits for society at large. Top management establishes mission statements and overarching organisational goals; senior and middle managers plan and implement, respectively, to achieve those goals. Organisational objectives must be carefully interpreted into objectives for each business unit. Business unit objectives then get translated into functional or area objectives. Effective objectives should display the characteristics described by the SMART model; they should be specific, measurable, actionable, reasonable and timetabled.

55

describe how to manage the implementation of a marketing strategy

Implementing a marketing plan involves numerous complexities. Some of the most common internal complications in implementing marketing are inertia, a lack of coordination and/or cooperation, a lack of a clear message or the presence of mixed signals, and focusing too much on the short term at the expense of broader objectives. Characteristics of the micro- and macro-environment also pose possible problems. They include increasing saturation of the market and fragmentation of the market. To minimise problems and build a platform for marketing success, marketers should plan, provide motivation and incentives for organisational members, empower staff, structure the organisation to support a market orientation and build a customer-focused organisational culture.

56

explain the role of marketing metrics and the ongoing evaluation of marketing performance in the marketing cycle

The marketing cycle is an ongoing loop where marketing programs are constantly revised and refined in response to evaluation, both throughout and after marketing efforts. Evaluation enables a marketing organisation to know, understand and respond to changes in the market. Marketing metrics are the measures that marketers use to understand how their marketing program has performed against the objectives set for it. This enables marketers to not only refine their marketing approach, but also demonstrate the important, central contribution that marketing makes to the overall success of the organisation.