Business

What is marketing? (just know for possible multi-choice)

• includes advertising, selling, and delivering products to consumers or other businesses.

- involves all the actions a company undertakes to draw in customers and maintain relationships with them.

- marketing seeks to match a company's products and services to customers who want access to those products.

- Stay relevant and meet customers' needs

- Matching products to customers ultimately ensures profitability.

4 Ps? (marketing mix)

product: developing products/ services that meet customer needs and provide value.

price: determine appropriate pricing strategies based on cost, competitors' prices and consumer demand

place: choose right distribution channels to make products available to customers at the right place and time

promotion: use various promotional activities to communicate the value of the products/services to the target audience +persuade them to buy it - social media

Products

- quality, packaging, design, brand name and guarantee.

•Customers will buy products that not only satisfy their needs and wants but also provide intangible benefits such as a feeling of security, prestige, satisfaction or influence

Marketing Strategies (APPS D)

Advertising: paid messages to promote products/services through various media channels.

Public Relations: Building positive relationships with the public and media to enhance brand image and reputation.

Sales Promotion: Offering short-term incentives to encourage immediate sales.

Personal Selling: One-on-one interactions with potential customers to persuade them to buy.

Digital Marketing: Utilising online platforms and strategies to reach and engage with customers.

Objectives of marketing MEEI

- Increase market share

- Expand product range

- Expand into new geographic markets

- Maximise customer service

Target market and market segments

- Businesses can't satisfy everyone's needs so they use market segmentation to be more precise with marketing

- divides whole market into smaller groups of consumers with common needs (eg: age, gender, location or income)

target market

specific group of potential customers who a business aims to reach with its products/services

Difference between primary and secondary target market

-primary target market is the main focus

-secondary target market is smaller but has growth potential

Ways to segment a market (GDPB)

- segmented group should be a large enough group of people to make the research worthwhile

- group itself should be easy to identify and easy to measure.

- Ways to segment: Geographic, demographic, psychographic, behavioural

Geographical segmentation

• focuses on where potential customers live or work.

•could be as big as world/country, or specific city/suburb, metropolitan/rural, climate: hot, cold or temperate.

Demographical segmentation

• Age

- gender

• Nationality/race

• Occupation or income

• Level of education

• Size of family and family life cycle (things like single/married, kids left home/kids at home/no kids) etc

Behavioural segmentation

• Purchasing frequency

• Type of shopping - comparison, convenience or specialty

• Loyalty status

• Benefits required - speed, quality, service, economy; or

• Needs - social, functional, economic, psychological or physiological

psychometric segementation

• Personality type (i.e. extroverted, introverted, ambitious, aggressive, compulsive etc);

• Lifestyle (i.e. achievers, optimists, socially aware, conservative etc); or

• Class (i.e. upper class, middle class, lower middle class etc).

•most difficult segmentation approach as it is generally based on the intrinsic, subjective characteristics

Pros of market segmentation and Why does a business select a target market?

Pros

-cam produce goods specifically aimed at these groups leading to increased sales.

-helps to identify groups of consumers that are not currently being targeted and then exploit them

- avoids wasting money on trying to sell products to the whole market

-Small firms unable to compete in the whole market are able to specialise in a market segment

Cons of market segmentation

-Research and production costs might be high as a result of marketing several different product variations.

-Promotional costs might be high as different ads and promotions needed for diff segments

-excessive specialisation could lead to problems if consumers in those segments change their purchasing habits

niche market

- small and specific market segment,

-product/service not being offered by mainstream businesses.

• larger businesses in the same industry will leave them alone, because they are targeting the generic market.

- no competitors, offer higher prices and achieve higher profit.

- if trends change and consumers no longer want the specific product/ service business will have to look for another niche

market positioning

• become the preferred product or service in their particular market.

• business differentiates itself from competitors

• Eg: when Pepsi discovered that Pepsi Light was thought to be directed towards a health-conscious female consumer, they developed Pepsi Max and specifically targeted it at the health-conscious male consumer.

Why analyse competitors?

• to understand thier advantages/disadvantages compared to competitors

Branding

-connecting a product (or business) with a particular name, symbol, or features and ideas to make it recognisable

• Brand equity - the social value of a well-known brand name

- distinctive impression that sets the brand apart from competitors (eg: Apple's innovation, Nike's empowerment)

brand equity (LAQA)

Loyalty: Repeat customers who consistently choose the brand over competitors.

• Brand Awareness: How easily a brand is recognised by consumers.

• Quality: Consumers' perception of the quality

•eg: Apple has built a premium brand with a loyal customer base, thanks to its innovative products, seamless ecosystem, and consistent brand messaging.

-Apple products as a status symbol, which drives high customer loyalty and allows Apple to command a premium price.

•Nike: The "Just Do It" slogan fosters strong emotional connections, making consumers feel inspired and motivated to purchase.

•Coca-Cola positions itself as the classic, nostalgic brand, often tied to happy, family-friendly moments - emotional connections

•Pepsi positions itself as the youthful, alternative to Coca-Cola

Situational analysis involves looking at... MIFSC

- market share of product

- future trends within the market

- strategies used by competitors

- changing consumer tastes and preferences.

- includes product life cycle and a SWOT analysis.

PESTLE

Political, Economic, Social, Technological, Legal, Environmental

PESTLE - political (5)

• Current or future legislation

• Government policies - data privacy laws

• Political change (elections)

• Funding, grants and other initiatives

• International trade

PESTLE - economic (5)

• Economic growth and trends - cost of living

• Tax, interest, exchange and inflation rates

• Trade cycles

• Growing and declining markets

• Industry trends

PESTLE - social (5)

• Consumer buying patterns

• Religious and ethical beliefs

• Demographics and education

• Health

• Opinions and attitudes

• Media

• Brand preferences

PESTLE - technological (3)

• Automation and AI

• Patents

• Research and Development - ecommerce

PESTLE - environmental (4)

• Geographical location

• Stakeholder and consumer values

• Global climate change

- Environmental offset and carbon footprint

PESTLE - legal (3)

• Employment laws

• Consumer protection

• Industry specific regulations

Market Growth rate

measure of the extent at which the market a company operates in is growing

Market share

a company's product sales as a percentage of total sales for that industry

Market Research (4 Ps)

- analysing data about customers, competitors and the market:

-analyse customer reaction to:

o different price levels

o alternative forms of promotion

o new types of packaging

o different methods of distribution.

Results of Market Research (4)

1. To reduce the risks associated with new product launches - investigating potential demand for new prod/serv business should be able to assess the likely chances of satisfactory sales

2. To predict future demand changes

•eg: the growth in the number of single-person households may suggest that there could be a rising demand for 'singles' holidays.

3. To explain patterns in sales of existing products and market trends

4. To assess the most favoured designs (i.e. flavours, styles etc) or promotions, packages for a product

Primary research types and pros and cons

quantitative and qualitative

pros: up-to-date and for specific purpose

cons: costly and time-consuming

Qualitative vs. Quantitative

Qualitative

-what motivates consumer buying preferences?

-involves focus groups

Quantitative

-surveys

-test marketing: after a decision has been made to produce a limited quantity of a new product

Boston Matrix

- helps identify which product to prioritise

Stars (high growth and high share)

• need a lot of investment

• generating a lot of income

• judge whether the market is going to continue to grow or will go down

Cash Cows (high share and low growth)

• don't need the same level of support as before

• lots of income

• can be "milked" to fund Star products.

Question Mark (high growth and low share)

• Problem Child, could be new product to market or need more investment to become Star

Dogs (low growth and low share)

• Loss/low profit

• can money spent on this be spent somewhere else?. - answer is usually yes.

How to use the BCG matrix? (4)

1. goal: innovation = increase investment in Stars and Question Marks.

2. If a business can't invest more into a product, keep it in the same quadrant and leave it alone.

3. Reduce investment and take out the maximum cash flow, increasing overall profit - cash cow

4. put money somewhere else - dog

Brand extension vs line extension

Brand extension:

-use existing brand name to launch new prod/serv in a different category or market

eg: Apple used its brand name to enter the music with iPod

- help leverage brand equity, increase customer loyalty, and reduce marketing costs

Line extension:

-introduce new version of existing product/serv in same category or market

-o Eg: Coca-Cola launched Diet Coke as line extensions of its original soft drink

- help you cater to different customer segments, increase market share, and defend against competitors.

aim of extension strategy

• extension strategy usually introduced between the maturity and saturation stages of the product life cycle, before a real decline takes place.

• The aim is to continue to maintain a steady rate of revenue from a product.

Strategies of extension strategy PRRRM

-Product differentiation

-reducing price

-rebranding product with new packaging

-repositioning - new market

-more ads and promotions

Brand recognition - celebrity endorsements benefits

• 3 Es - entice, enrich and enable
  • celebrities provide enticing benefits through their good looks, voices, and humour, brands

-brands hope celebrities’ glamour or pleasing charm is transferred to the brand - enrich

• Consumers may trust an endorser because of their enabling benefits, such as expertise and skills in certain product categories

Celebrity endorsements risks (4)

-celebrity scandal - negative perceptions of them can go to brand

-high cost, low returns

-if value of brand doesn't align with celebrity

-celebrity overshadows product

Celebrity endorsements Dos and Don't's

Dos:

- maintain consistency and long-term commitment to establish strong identity

- endorser should be attractive, positive image and knows about company

• Values match of celebrity and company

• Ensure endorser doesn't endorse other brands for stronger identity

Product placement purpose

to build brand recognition and capture viewers' purchase intention when they go shopping.

How product placment is differnt from traditional marketing

people understand they are viewing traditional paid advertising; but with prdouct placemnt they may not even realise they're viewing a piece of advertising - its relatively overt and seamless - taps into the viewer's emotions and subconscious.

Examples of product placement

• TV and movie placement:

• Video game placement:

• Social media placement:

• Verbal placement eg interview

How to ensure good product placement

- seamless integration as if it's too obvious or intrusive, viewers may perceive it as advertising and reject it.

-enough exposure for the brand without tainting the content of the media.

Criticisms of marketing

-marketers manipulate consumers into buying unnecessary items by exploiting our materialism

- concealed facts and omitting details eg: low fat but adding sugar

-exaggerated claims eg: legal but misleading - best coffee

-vague statements: eg: helps fight wrinkles - no proof required

-

7 Ethical issues in marketing (Demi’s AC)

- AI and automation - avoid biases in AI algorithms

- Cultural sensitivity - respecting different cultures' values and beliefs in ads, avoiding stereotypes or cultural appropriation

- Data and privacy concerns - marketers be transparent with data they collect and how it will used

- Environmental sustainability

- Influencer marketing - transparency in disclosing sponsored content

- Misleading ads

- Social responsibility and avoid targeting vulnerable populations such as children or elderly

Sampling

•       Random sampling:

•       Every member of the target population has an equal chance of being selected

•       Stratified sampling:

•       This draws a sample from a specified sub-group or segment of the population and uses random sampling to select an appropriate number from each stratum

•       Cluster sampling:

•       Using one or a number of specific groups to draw samples from and not selecting from the whole population, e.g. using one town or region

•       Quota sampling:

•       Gathering data from a group chosen out of a specific sub-group, e.g. a researcher might ask 100 individuals between the ages of 20 and 30 years

Psychology phenomena for product placment (3)

•       Realism and Immersion For Authenticity

•       Unlike disruptive traditional ads, placements seamlessly integrate

•  maintains viewer immersion and allows authentic, organic brand interactions.

• more realistic and relevant.

•       The Mere-Exposure Effect

•       increased familiarity through repeated exposures fosters greater liking.

•       Even brief glimpses of a product in the background boost brand recall and purchase intent.

•       Placements work on volume, with more exposures strengthening this effect.

•       Classical Conditioning Drives Emotional Connections

•       Product placement leverages classical conditioning by associating brands with the positive emotions elicited by the surrounding content.

•       Characters who use placed products become conditioned stimuli that transfer those feelings onto the brand.