Business Studies- MARKETING

year 12 HSC course, includes definitions, role, strategies, processes and influences (+examples)

what is the strategic role of marketing?

to develop an appropriate marketing mix that maximises sales in one or more target markets, contributing to profit maximisation.

what is interdependence?

the mutual reliance relationship between two key business functions

what are the three approaches as part of the marketing strategic role?

production, selling & marketing approaches

what does the production approach refer to (role)?

focuses on the production of goods & services

what does the selling approach refer to (role)?

emphasises selling because of increased competition (promotion)

what does the marketing approach refer to (role)?

emphasises finding customers wants through market research

what are the four main types of markets?

• resource

• industrial

• intermediate

• consumer

what is a market?

a group of individuals/organisations that need/want a product & are willing, able and legally authorised to purchase the product

what is included in the resource market (type of market)?

market with all forms of primary production, producing raw goods

what is included in the industrial market (type of market)?

market where products are purchased to use as inputs to production/operations

what is included in the intermediate market (type of market)?

where finished products are purchased & resold for profit

what is included in the consumer market (type of market)?

where individuals who plan to use/consume products purchase products

what are some examples of resource markets (type of market)?

mining, agriculture or fishing

what are some examples of industrial markets (type of market)?

Sony or Tip Top Bakery

what are some examples of intermediate markets (type of market)?

Coles or JB-HI-FI

what are the additional two types of markets?

mass & niche

what is a mass market (type of market)?

standard product sold to a large market (no segmentation)

what is a niche market (type of market)?

narrowly selected target market (specific segmentation)

what are some advantages of a niche market (type of market)?

• more tailored/effective strategies

• higher customer loyalty

• less competition

what are some disadvantages of a niche market (type of market)?

• smaller customer base

• limited growth

• vulnerability to market shifts

what are the four factors influencing customer choice?

• psychological

• sociocultural

• economic

• government

what are psychological factors influencing customer choice?

influences ‘within the mind’ of the individual

what is included in psychological factors influencing customer choice?

• perception

• motive

• attitude

• personality

• learning

what are sociocultural factors influencing customer choice?

influences exerted by other people & groups

what is included in sociocultural factors influencing customer choice?

• social class

• culture

• family/roles

• peer groups

what are economic factors influencing customer choice?

influence of the level of economic activity, which fluctuates over time

what is included in economic factors influencing customer choice?

the business cycle

• expansion (boom)

• contraction (bust)

what are government factors influencing customer choice?

influence of policies/laws that impact customer choice

what is included in government factors influencing customer choice?

the level of economic activity

• macroeconomic policy

what is the influence of consumer laws, as part of Australian law?

Australian Consumer Law (ACL), included under the Competition & Consumer Act (2010)

what year was the Competition & Consumer Act introduced?

2010

who enforces the Competition & Consumer Act?

the Australian Competition & Consumer Commission (ACCC)

how do consumer laws influence marketing?

businesses must ensure they are up to date with laws & apply them to practice

what is included as part of the influence of consumer laws?

• deceptive and misleading advertising

• price discrimination

• implied conditions

• warranties

what does deceptive & misleading advertising involve (influence consumer laws)?

that businesses must ensure representation that is truthful, accurate and based on reasonable grounds

what is the exception of deceptive & misleading advertising (influence consumer laws)?

puffery - wildly exaggerated/vague claims

what are examples of deceptive & misleading advertising (influence consumer laws)?

• bait advertising

• fine print

• comparative advertising that is inaccurate

• unsubstantial claims

• false country of origin claims

what does price discrimination involve (influence consumer laws)?

charging customers different prices for the same product based on what the seller thinks they can get the customer to agree to

what does implied conditions involve (influence consumer laws)?

the unspoken & unwritten terms of a contract, known as consumer guarantees

what are the two guarantees under implied conditions (influence consumer laws)?

• Guarantees for Goods

• Guarantees for Services

what are the two legal elements of implied conditions (influence consumer law)?

• customers automatically recieve these when they purchase

• if a product/service doesn’t meet guarantees, customers are entitled to a solution/remedy

what does warranties involve (influence consumer laws)?

extra promises from a business about the quality of a product/service or how it will fix any problems with that product/service

what are the three types of warranties & what do they involve (influence consumer laws)?

• express/common warranty (quality/standard)

• warranty against defects (if something goes wrong)

• extended warranty (sold seperate for extra cost)

what is the ethical influence?

that business practices are socially responsible, morally right, honourable and fair, going above legal compliance

what are the five syllabus points of the ethical influence?

• truth

• accuracy & good taste in advertising

• products that may damage health

• engaging in fair competition

• sugging

what does truth involve (ethical influence)?

that some adverts may be legal, but are unethical

what are the ‘grey areas’ of truth (ethical influence)?

• concealing pieces of information purposely from adverts

• exaggerated claims used for promotional purposes

• ambiguous statements leading to customer assumption

what does accuracy & good taste in advertising involve (ethical influence)?

that consideration for what is ‘good taste’ should be made, aware of community sensitivities and ensuring ads aren’t offensive

what does products that may damage health involve (ethical influence)?

promotion/advertising of things that are harmful to the human body/mind could be considered unethical

what is an example of products that may damage health as an ethical influence?

that it is unethical to market junk food specifically to children

what does engaging in fair competition involve (ethical influence)?

the laws prohibiting anti-competitive marketing practices in the Competition & Consumer Act (2010)

what are some laws relating to engaging in fair competition (ethical influence) in the Competition and Consumer Act (2010)?

prohibitions of:

• cartel conduct

• misuse of market power

• exclusive dealing

what does sugging involve (ethical influence)?

unethical to sell under the guise of a survey or market research

what is the first step in the marketing process?

situational analysis

what does situational analysis involve?

SWOT & product life cycle

what does SWOT (situational analysis) involve?

analysing internal & external business environment

why should a business conduct SWOT (situational analysis)?

to provide a precise understanding of the business’s current position and future direction

what does SWOT stand for?

• Strengths

• Weaknesses

• Opportunities

• Threats

what is the acronym for the marketing process?

SMEIDI

what is customer loyalty considered as within SWOT?

• strength (if strong)

• weakness (if weak)

what does the product life cycle include?

the stages a product passes through

what are the four stages of the product life cycle?

introduction, growth, maturity & decline

is a product life cycle situational analysis conducted before or after a SWOT analysis?

after SWOT

what does the introduction stage of the product life cycle involve?

when a product is launched into the market & initial marketing efforts aim to build awareness

what does the growth stage of the product life cycle involve?

when a product gains market acceptance & sales increase rapidly

what does the maturity stage of the product life cycle involve?

when sales growth slows and there is increased competition

what does the decline stage of the product life cycle include?

when sales decrease (product loses market relevance) and there are new alternatives

what is step 2 of the marketing process?

market research

what does market research involve?

systematically collecting, recording and analysing information concerning a specific marketing problem

why should a business conduct market research?

• more informed about aspects researched

• strategies are more accurate

• marketing more efficient

what are the two sources of data considered in market research?

primary & secondary

what does a primary source of data involve, in market research?

original sources for the purpose of the specific question

what does a secondary source of data involve, in market research?

compromising infortmation that has already been collected for other purposes

what is an advantage of primary data, in market research?

+ tailored to the specific needs of research

what is a disadvantage of primary data, in market research?

- time consuming & expensive to collect

what are examples of primary sources of data?

observations, surveys & experiments

what is an advantage of secondary data, in market research?

+ usually easy to access & inexpensive

what is a disadvantage of secondary data, in market research?

- may not be sufficient to answer research question

what is step 3 of the marketing process?

establishing market objectives

what are marketing objectives?

realistic & measurable goals to be achieved through a marketing plan

why should a business establish marketing goals?

• provide a clear direction

• inform/shape strategies

• evaluate the effectiveness of strategies

what are examples of market objectives?

• market share

• product range

• maximising customer service

what is step 4 of the marketing process?

identifying target markets

what is a target market?

group of present & potential customers to which a business intends to sell its product, usually sharing similar characteristics

what is step 5 of the marketing process?

developing marketing strategies

what are the parts of implementation, monitoring & controlling (process)?

• developing a financial forecast

• implementing marketing strategies

• monitoring & controlling

• revising marketing strategy

what does developing a financial forecast involve?

estimating future revenue & expenses after implementing the marketing strategy, including estimating costs/revenue.

what does implementing marketing strategies involve?

putting marketing strategies into action

what is monitoring?

measuring actual performance

what is controlling?

comparison of actual & estimated performance & taking corrective action if needed

what are the three types of analysis used in monitoring & controlling?

• sales analysis

• market share analysis

• market return on investment

what does revising marketing strategy involve?

if marketing strategies are altered, depending on the achievement of objectives