Marketing is the management process responsible for identifying, anticipating and satisfying consumer's requirements profitably.
Initially organizations used to focus on merely producing goods through mass production techniques and their aim was to produce goods at the lowest possible cost. Later they realized that they needed to make an effort to sell those goods to people even if the consumers were unwilling to buy it. Now, however, the focus has shifted to finding out what exactly are the requirements of the consumer and then producing the goods according to their requirements. This new thinking is called the Marketing Concept.
Before carrying out an marketing activity an organization should carry out two broad analysis of the environment.
SLEPT meaning Social, Legal, Economic, Political and Technological factors in the environment that influence or can influence the organization's activities.
SWOT meaning Strength, Weakness, Opportunities and Threats.
After analyzing the SLEPT factors in the environment an organization will be able to find out what opportunities are available and what threats the organization is facing. Then they should try to find out in which areas, products etc they are strong and where they are weak. Having analyzed all these factors an organization should then develop it's marketing strategies (broad action plans).
In a marketing activity we have to focus on the following 4 Ps :
Product: A product can be a goods, service or even an idea. The marketing department should check what types of products are in demand, if any modification is required in the existing products or should the production of some products be stopped, or should some new products be developed etc.
Place: The marketing strategy should be devised in such a way that the company's products reach the customers at that right place. Arrangements should be made through various distribution channels (sole selling agents, wholesalers, retailers ) etc to ensure that the product is available at the retail stores when a consumer comes to actually buy it. This concept is increasing changing with the growth of e-commerce as the role of the distribution channels is minimized.
Price: Price is a very important component in marketing as some goods are highly price sensitive, meaning that any change (increase or decrease) in their price can bring about a major change in the demand. The price is set after considering the costs, prices of competitors, profit margin required, buyers perception about the product etc.
Promotion: promotion includes all those activities that help increasing the awareness of the product in the minds of the consumers. Inorder to do this marketers use various promotion tools like advertising, sales promotion, publicity, direct marketing, personal selling etc.
Apart from the above mentioned 4 Ps there are three additional Ps that are used in case of marketing of services.
Process: A service is delivered to the customers through a process. For example, when we go to the airport we have to wait in a queue, and the staff take us (the consumers of the service) through a process of baggage screening, collecting the boarding passes and then taking a seat in the aircraft.
Physical Evidence: In case of services the environment in which the service is offered also makes a great impact on the consumers perception about the liking or disliking of the service. For example, when we go to a restaurant we not only look at how good the food is, but also at the surroundings, the ambience, the cleanliness etc.
People : The actual staff that meets the customer is very important coz we form our opinion about the company's service based on the attitude of the staff. For example, in a hospital we tend to form an opinion about the service based on the attitude that the doctors, nurses and other staff have towards their patients. Yes ofcourse, the actual success of the treatment is very important too.
Today, marketing is a highly specialized field of study with various dimensions.
Marketing Strategy decides the various goals and plans that the organization will follow. Marketing Communications decides how the consumers will be made aware of the offerings of the company.
International Marketing decides how an organization should venture out into new or similar business at a foreign location.
To make all such diverse and important decisions, management requires a lot of information about various aspects. This information is provided to management through Marketing Research.
Marketing research is the systematic design, collection, interpretation and reporting of information to help solve specific problems or take advantage of marketing opportunities.
It should be noted however that marketing research is not the same as market research. Market Research is just one element of the whole marketing research. In a marketing research we collect information about various diverse issues like product, price, promotion etc. but in case of a market research we are only trying to find out how good or bad a particular market (area, place, country etc) is for our company's products.
In every big organization the marketing department collects a lot of data. These data are then stored in a very systematic manner for use in the future. This framework for the day to day management and structuring of information is called Marketing Information System.
Remember that the mere collection of data does not constitute a marketing information system coz inorder to serve some purpose the data collected has to be tabulated and arranged in a systematic manner. Only then does data become information. And when this information is analyzed appropriately, it becomes knowledge.
The Marketing Research Process
The marketing research process moves in the following steps:
1. Defining and locating the problem: The first step is to find out in which specific area of marketing does the problem lie. Here we need to find out the real problem which may sometimes be hidden beneath the visible problem. Thus we need to make a distinction between the symptom and the cause. For example, the problem that might be visible to us could be decreasing sales but the actual hidden problem could be in the pricing strategy or even in the promotion strategy.
2. Developing a Hypotheses: A hypotheses is a guess or assumption about a certain problem. For example, we might make a guess that the decreasing sales are due to the incorrect pricing strategy. And then we collect various data to check whether the guess that we made was right or wrong.
3. Collecting Data: The kind of hypotheses that we make about the situation will determine the approach of collecting data.
· When we need to find out some specific information about a product or a problem we carry out exploratory research.
· When the problem identified in the first stage is quite clear we need to collect data about that phenomenon to know various characteristics associated with that problem. This is called descriptory research For example, a researcher trying to find out how many people in the age group of 18 to 30 eat ice cream in a particular city.
· Sometimes when we need to measure the relationship between two or more variables we use causal research. For example, the marketers hold other variables constant and then try to find out what will be the changes in demand if price is increased.
Inorder to collect data we can use various tools. These are as follows:
· Secondary Data : Any data that is already collected by some one else for some other purpose other than the current research is called secondary data. This type of data may include internal sources like sales records, research reports etc. It may also include external sources like trade journals, publications of chamber of commerce, govt. publications, magazines, internet etc.
· Primary Data : Any data that is gathered for a specific project or purpose by ourselves is called primary data. This type of data may be collected through observation of people, surveys (interviews, use of questionnaires ), focus groups (inviting a selected group of people and asking them to talk about a product and then analyzing what they say). While collecting primary data we often choose a sample. A sample is a representative of the whole population on which we then apply the results of the research conducted on the sample.
4. Analyzing and interpreting research finding: After the data is collected, it is then arranged and tabulated so that it can be analyzed. Various statistical tools like mean averages, deviations etc are used to interpret the data.
5. Reporting the research findings : Finally, the marketer collects all the information and then makes a clear and objective judgement about how right (or wrong) the assumed hypotheses was. A written report is often prepared and recommendations are given to the management. Based on these the management takes the appropriate decisions.
Characteristics of a good marketing research
A good marketing research should be conducted in a scientific manner without any bias or subjectivity. We shouldn’t solely rely on just one method of data collection. The value derived from the data received should be higher than the costs of collecting the data.
The research process and the collection of data should be done in an ethical manner.
Trends in Marketing Research
An increasing number of large scale organizations are now using Marketing Decisions Support Systems (MDSS). MDSS is a coordinated collection of data, systems , tools and techniques with supporting software and hardware by which an organization gather and interprets relevant information from business and environment and turns it into a basis for marketing action.
Suppose a marketing manager needs to analyze and take action. The manager puts questions to the appropriate model located in the MDSS. The model draws up data, which are then analyzed statistically. The manager can then use a program to determine the optimal course of action. The manager takes this action , which (along with other forces) affects the environment and results in new data. All of these actions take place in the computer.
Thus we can see that Marketing research plays a very integral role in any modern business. We are surrounded by a very dynamic environment and if organisation have to ensure that they experience the sweet smell of continued entrepreneurial success, then they need to be aware of relevant changes. The key to success today is information and as has been rightly quoted by Marion Harper "To manage a business well is to manage it's future; and to manage the future is to manage information. "
Definition: Management process responsible for identifying, anticipating and satisfying consumer's requirements profitably.
Exchange between buyer and seller of something of value
Goods/Services/Ideas --- Serducts or Provices
A market is a:
ü Place for buyers and sellers
ü Geographical area
ü Relationship between the demand and supply
Why study marketing:
· Used in all organisations,
· Important for business and economy,
· Consumer awareness,
· Big portion of costs.
* Production era * Sales era * Marketing era
Marketing Strategy: selecting target markets and using the right marketing mix
5. Physical evidence
Mission: overriding premise in line with the values and expectations of stakeholders
Goal: general statement or aim of purpose
Objectives: quantification of goals
Strategy: broad action plans
Action: individual steps (tasks/tactics) to achieve strategies
Control: monitor results
Rewards: payoff for reaching objectives
Marketing Management should be Effective and Efficient
--- It involves Planning, Organizing, Implementation and Control of Marketing activities.
Collect information about external environment through Environmental Scanning.
Assess information collected through Environmental Analysis
Responses towards environment could be to either:
ü Accept it, or
ü Confront it
Macro Environmental Forces:
· Social: demographics, population size and structure, lifestyles, buying behavior, needs, attitudes, family, age, status, perception etc.
· Legal: various laws that affect businesses. Precompetitive legislation (MRTP Act), Consumer protection legislation, Non-governmental regulatory forces (code of advertising standards and practice.)
· Economic: economic condition (prosperity, recession, depression, recovery), consumer demand and spending power, income (disposable, discretionary), wealth, savings, spending patterns.
· Political: got, stability, type, role…maintain good relations
· Technological: level of technology, it's role and impact on business, consumers and marketing
· Societal/Green: clean and green movement, eco-friendly
Use acronym SLEPTG for the above.
Competitive environment: monopoly, oligopoly, monopolistic competition, perfect competition
These help us in identifying the Opportunities and Threats
Micro Environmental Forces:
Analyze the various aspects of your own organisation and identify it's Strengths and Weaknesses.
Types of Markets : Consumer Markets (for self consumption)
Organisational Market (producer, reseller, government or institutions)
ü Undifferentiated approach: same marketing mix for all purposes. Best when same need, I marketing mix satisfies all and product is homogenous.
ü Market segmentation: grouping people with similar needs and offering separate marketing mixes for each group. Helpful in market penetration, product/market development.
Elements of Segmentation: Segmenting Targeting Positioning
Segmenting: grouping customers and dividing markets into divisions. Use
For Consumer Goods:
Demographics: (age, life-cycle, population statistics…)
Socio-economic: (income, occupation, education and class…)
Geographic: (climate, terrain, density, city size…)
Personality, motives, attitudes, lifestyles.
Product related behavioural characteristics:
benefits derived out of product.
For Organisational Goods:
Type of organization
Size of organisation
Use of product
Effective segments should be Measurable, Sustainable, Accessible, Stable and Beneficial
2. Targeting : Based on resources, competition and product characteristics
Concentration strategy: all marketing efforts towards one market segment by one marketing mix. Helps specialize but moving to new segments difficult. E.g. Ferrari sports car
Multi-segment strategy: marketing efforts directed at two or more segments with separate marketing mixes. Helps increase sales, reduce risks but more costs of production, marketing.
3. Positioning: the place a product occupies in the consumer's mind. Position can be found through Market Research. Affected by reputation and image. Perceptual Mapping - visually depicts the consumer's perception about different brands and their perceived attributes.
Steps in Positioning:
1. Define segments in market
2. Define which segment to target
3. Understand what consumers expect and believe as important.
4. Develop products for these needs
5. Evaluate positioning/image of competitors as viewed by consumers
6. Select credible position after matching with needs
7. Promote well with right marketing mix
Meaning: Systematic, design, collection, interpretation and reporting of information to help marketers solve specific marketing problems.
Types: Qualitative and Quantitative
MIS - framework for research
Marketing Intelligence - all data in an organisation
1. Define problem
2. Develop hypothesis
3. Collect data
4. Analyze and interpret
5. Report research findings
Secondary: already available
Internal (records, database)
External (census, government, publications)
Primary: collect for self use, first time
Observation - personal, mechanical
Surveys (population or sample), mails, telephone, personal
Research should use Ethical Means
Product: a complexity of tangible and intangible attributes, including functional, social and psychological utilities or benefits. Product may be Goods / Services / Ideas
Levels of Product
Core benefit or service
Actual product (quality, features, brand name, packaging, design…)
Augmented product (after-sales, customer service, warranty, installation, delivery, credit…)
Every product moves through four stages of its life cycle :
Introduction, Growth, Maturity and Decline
Product Item: specific version of a product that is distinct. (Cadbury's Dairy Milk chocolate)
Product Line; group of related products because of marketing, technical or consumer considerations. (All Cadbury's chocolates)
Product Mix: all group of products that an organisation offers to customers.
Depth - number of products offered in each product line
Width - number of product lines a company offers.
Problems: Negative push, market size overestimation, actual product turns out bad, wrong positioning, high actual costs, competitor's copy…
Organizing NPD: NP Managers, Committee, Department, Venture Teams etc.
Steps in NPD Process:
1. Idea Generation: customer's needs, research teams, copy/change competitor's products, sales representatives, top management.
Methods:- Attribute listing, Forced relationship (combined product), Need/Problem identification (Marketing Research), Brainstorming.
2. Idea Screening: screening by a committee. Match with organisations objectives/goals. Drop error Vs Go error. Rate and weight various ideas.
3. Concept Development and Testing: more refinement of ideas.
E.g.: Nutritional powder to add to milk. Concepts could be breakfast drink for adults for evening; tasty drink for children for midday; health drink for older people before sleep. Next prepare positioning map in terms of different features. Also prepare brand positioning showing competing brands.
Testing: Find preferable attributes by customer, turn to engineering (customer driven engineering). Find utility values/weightage given by customer to each feature.
4. Marketing Strategy Development: preliminary strategy. Includes:-
Target market size, structure, positioning, market share, profit goals
Planned price, distribution, marketing budget
Long term sales and profit and marketing mix strategy.
5. Business Analysis: attractiveness in terms of business. Estimate initial sales, replacement sales and repeat sales. Calculate various costs, overheads etc. and profits.
6. Product Development: develop prototype through R&D. CAD, CAM, 3-D simulations, virtual products, functional testing and consumer testing.
7. Market Testing:
Consumer Products: simulated test marketing (focus group), controlled test marketing (soft launch in limited places) test markets (how many cities, timing, action)
Industrial Products: alpha testing, beta testing, trade shows and exhibitions
When - first, parallel, late
Where - local, regional, national, international or global
How - positioning, promotion decisions, AIDA (all standardized or adapted - Glocal)
To whom - early adopters, heavy users, opinion leaders.
Organizational buying us the decision making process by which formal organisations establish the need for purchasing products and services and identify, evaluate and choose among alternative brands and suppliers.
Industrial Goods Include:
Raw Materials, Major Equipment, Accessory Equipment, Component Parts, Process Materials, Consumables, Industrial Services
Fewer Buyers, Larger Buyers, Leasing, Fluctuating Demand, Multiple Sales Call, Larger Buyers, Derived Demand, Inelastic Demand, Direct Purchasing, Close Supplier-Customer Relationship, Professional Purchasing, Several Buying Influences, Geographically Concentrated
Three Different Types of
Organizational Buying Situation:
Major Influences on
Organizational Buying Include:
Environment: Political, Economic, Social, Legal, Technological, Cultural, Natural and Competitive
Organizational: Objectives, Policies, Structure, Procedures, Structure and Systems
Interpersonal: Authority, Status, Empathy, Persuasiveness
Individual: Age, Education, Job Position, Personality and Risk Attitudes
Participants in the Buying Process include Gatekeepers, Users, Influencers, Deciders and Buyers
Stages in the Business Buying
General Need Description
Order Routine Specification
A name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from competitors. - AMA
Six Levels of Meaning
Attributes: Mercedes - expensive, well-built, durable, prestige
Benefits: "Won't need another car for long", Admired & Important
Values: High performance, safety and prestige
Culture: German culture of being organized, efficient and high quality
No-nonsense boss (person), reigning
lion (animal), high tower (object)
55 year old top executive expected but not 20 year old secretary !!
Brand Loyalty - Brand Advocator / Brand Killer
To brand or not to brand decisions
Brand sponsoring decisions
Brand name decisions
Brand strategy decisions
Brand re-positioning decisions
All activities of designing and producing the container for a product.
Old Spice Aftershave lotion in a bottle (Primary Package)
In a Cardboard Box (Secondary Package)
In a Corrugated Box (Shipping Package)
Three Basic Functions:
Protect: during storage, transport, from children
Offer Convenience: in pouring, squeezing, storing, stacking & consuming.
Communication: Grab the attention of passer by, Persuade "Buy Me", Build loyalty with pack, information about ingredients, how to use, warnings…perceptual meanings of status or quality.
Packaging Designer's Tools
The Communication Process:
Sender - Encoding - Message - Decoding - Receiver - Feedback
Developing Effective Communication:
Identify Target Audience: (whom do you want to send your message to )
Determine Objectives: (awareness, knowledge, liking, preference, conviction, purchase)
Design Message: (message content, structure, format, source)
Select Channels: (personal or non-personal channels)
Establish Budget: (affordable, % age of sales, competitive-parity, objective and task)
Communication Mix: (advertising, sales promotion, public relations, personal selling,
Measure Results: (have the efforts yielded effective results)
Manage Integrated Marketing Communications
"Paid form of non-personal representation of goods, ideas or services by an identified sponsor"
Advertising Appeals: Emotional, Rational, Moral
Developing an Advertising Program
Setting Objectives: (informative, persuasive, reminder, reinforcement)
Deciding Budget: (what stage of PLC, market share, competition etc.)
Choosing Message: (generation, evaluation, selection, execution)
Media: (media selection - reach/frequency/impact, specific vehicles, media timing)
Evaluation: (communication effect, sales effect)
Choosing an Advertising Agency
Develop a Pool List of Agencies
Select Winner and Announce
Agree Contract Details
Agency Types: In-house, Full Service, Creative Shop
"Short term incentives designed to stimulate demand by consumers or trade"
Consumer Promotion Tools:
Samples: (sent door to door, in mail, at store, attached with another product)
Coupons: (giving bearer a saving on the purchase of specific product)
Cash Refund: (send proof of purchase to manufacturer and get refund by mail)
Price Packs: (e.g. two for the price of one, or two related products together)
Premiums: (gifts given absolutely free or at low prices)
Prizes: (contests - best entry wins, games - collect n win, lucky draw)
Warranties: (promise to fix error or refund money during a specified period)
Frequency Programs: (reward loyalty of customers with various offers)
Tie-in-Promotions: (teaming of two or more brands to increase pulling power)
Cross-Promotion: (use one brand to advertise another non-competing brand)
Point-of-Purchase: (attractive displays at place of purchase)
Trade Promotion Tools:
Price-Offs, Allowance, Free Goods, Trade Shows, Sales Contests, Specialty Advertising
" Programs aimed at promoting or protecting a company's image in the minds of it's publics"
Uses of Public Relations:
Assisting in the launch of new products
Assisting in repositioning a mature product
Building interest in a product category
Influencing specific target groups
Building the corporate image
Public Relations Tools
Publications: (reports, brochures, articles, newsletter, magazines, CDs etc.)
Events : (news conferences, trade shows, contests, competition, anniversaries)
Sponsorships: (supporting sports, cultural events etc)
News: (motivate media to air or publish press releases about company events)
Speeches: (trade associations, seminars…)
Public Service: (contributing money and time to social causes)
Identity Media: (logos, cards, buildings, uniforms, stationery, brochures, dress code)
"Using consumer-direct channels to reach customers without using marketing middlemen"
Channels of Direct Marketing
Face to Face Selling
Growth of Direct Marketing
Market Fragmentation, Tailor-made Technology, List Explosion, Sophisticated Software, Hybrid Marketing System, Constant Search for Cost-Effective Communications
Effective Direct Marketing
Identify Prospects - Target Media - Sell Products - Get Customer Information - Build and Analyze Database - Talk to Key Customers Regularly - Cross sell/Upsell/Renewal - Increase Customer Value - Analyze Database
"Informing and persuading customers to purchase products through an interactive relationship in an exchange situation"
Steps in Personal Selling
Prospecting and Qualifying
Need and Problem Identification
Presentation and Demonstration
Dealing with Objections
Closing the Sale
Need Satisfaction Selling
Price is the only "P" of the marketing mix that generates revenue.
High value strategy
Super value strategy
Over charging strategy
Medium value strategy
Good value strategy
Rip off strategy
False economy strategy
Steps in the Strategic Price Planning:
1. Determine influence of product (innovative/repeat/copy product) and distribution strategy (exclusive stores or discount stores)
2. Evaluate market, cost (fixed and variable), competition (dumping), legal and ethical factors.
3. Determine the flexibility (high and low end) in price strategy.
4. Set price strategy objectives: survival, max. current profit, max. current revenue, max. skimming, product-quality leadership, mere cost recovery, social pricing.
5. Decide how to position price relative to key competitors.
6. Decide whether price will be active or passive element of the mix strategy
7. Develop policies based on 3Cs.- cost, customer demand and competition
8. Implement, manage and control price strategy.
· Mark-up pricing: cost + profit % or certain profit % on sales.
· Perceived value pricing: value of product in consumer's mind.
· Value pricing: low price for high quality goods.
· Going rate pricing: based on competitors price
· Sealed bid pricing: quotations submitted for industrial markets
· Psychological pricing: high price tag for gift item, low product displayed in high location, odd number, e.g. $ 299 only.
· Geographical pricing: pricing for distant customers. cash, barter, complex counter trade.
· Price discounts: cash, quantity, seasonal, trade-in
· Promotional pricing: loss-leader pricing (sell at loss of popular product), special event, cash coupon rebates, low-interest financing, installments, psychological discounts (inflated price discounts)
· Discriminatory pricing: customer segment (low price for students), product form (5 gallon or 1.5 liter mineral water), image pricing (same product in different packaging), location, time
· Product mix pricing: product line pricing (4 versions of same shoes), optional feature (cars), captive product (spare parts expensive - Gillette), two part pricing (annual and rental), by-product pricing, product bundling.
Reaction to price changes: by consumers and by competition.
Definition: indicates the specific markets towards which activities are to be targeted and the types of competitive advantages that are to be developed and exploited.
Each organisation has several SBUs - Strategic Business Units (separate product line or profit center competing with defined sets of competition). E.g. PepsiCo includes Pepsi Cola, Fritolays, KFC, Pizza Hut…
Develop a Strategic Market Plan. It is a blueprint for all activities of an organisation in the marketplace. Marketing Plan deals with implementing the marketing strategy for target markets and marketing mix.
Tools for Strategic Market Planning: 1. BCG Matrix
PROBLEM CHILD (?)
RELATIVE MARKET SHARE
Stars: Market leaders, growing, huge profits, large invst. Required for growth. Protect share, reinvest in promotion, better coverage, product features. Obtain larger share of new users.
Problem Child (?): Rapid growth, low profits, demands cash. Invest heavily, acquire competitor's share, divestment if not feasible. Focus on a profit niche.
Cash Cow: Profitable products, more cash generated. Maintain dominance, improve processes, maintain price leadership, increase cash from resources in other product.
Dogs: Cost disadvantages, low opportunities for growth. Focus on specialized niche, abandon, harvest (get cash from remaining life), divestment (sale)
2. GE Strategic Business Planning Grid / GE Nine Cell Grid
After analyzing business position determine business direction by developing competitive strategies.
1. Intense Growth: When current markets and products have potential for increasing sales.
· Market penetration: increase sales in current markets with current products (Pepsi and Coke with their advertisements)
· Market development: increase sales of current products in new markets (Virgin Atlantic Airlines in Dubai)
· Product development: increase sales by improving current products or developing new products for current markets. (Nokia 5110 in UAE)
2. Diversified Growth: New products in new markets. Helps spread risks, reduce costs and share the benefits of promotion.
· Horizontal diversification: not technologically related products (Sony's purchase of Columbia pictures)
· Concentric diversification: related to new product technologically or on marketing factors but new product introduced into new markets. (Coke and Thumbs up in India)
· Conglomerate diversification: new product unrelated to existing products and introduced in new markets. (Laura Ashley clothing to Laura Ashley No. 1 perfume)
3. Integrated Growth: growth in the same industry but in three different ways, viz.
· Forward: ownership of distribution system (shoe firm buying retail store)
· Backward: ownership of supply system (newspaper buying paper mills)
· Horizontal: ownership/acquisition of competitors (Coke acquiring Parle in India)
Other Important Terms:
Market Leader: Holding highest market share
Market Challenger: biggest competitor, attacks aggressively
Market Followers: copy cats, me--too
Market Nichers: focus on narrow segment, specialize and make profits (Body Shop, Porsche)
Market Size Estimation
Evaluating market opportunity: what units (money, items..) account for changes as well
Threat of Entry: economies of scale, capital requirements of entry, access to distribution channels, expected retaliation, legislation (government monopoly), differentiation.
Supplier Power: high switching costs, important brand value of supplier, supplier integrating forward risk, size
Buyer Power: volume high, easy substitution, risk of backward integration
Threat of Substitutes: don’t be myopic. Furniture competes with car, holiday. Doing without can also substitute. E.g. Tobacco, alcohol.
Analyzing Strategic Capability
· Resource audit; physical, human, financial, technical, intangible.
· Value chain: support activities: firm infrastructure, HRM, technology, procurement
Primary activities: inbound logistics, operations, outbound logistics, marketing and sales, service. Find critical success factors and try to build linkages. Check also for appropriate control systems (financial, human, stock, marketing etc.)
· Comparing: previous years, others in the industry benchmarking
· Assess Balance: of products, resources, skills and personalities, corporate culture
· Identify key issues through SWOT analysis (strengths, weaknesses, opportunities and threats) And find core competencies (determine ownership, durability, transferability and replicability
Price based or
Differentiation. (differentiation from whom and on what basis.)
Focus could be on one or also as a combination of both cost and differentiation.
Direction: withdrawal, consolidation, market penetration, product development, market development, diversification - related (backward, forward, horizontal) or unrelated.
Internal development (develop by self),
Mergers and acquisition (useful if no knowledge of internal development, quick, but problems in 'fitting'.
Joint ventures/alliances, consortia, networks, licensing, franchising, contracting.
Marketing Management MCQs 1. ___________is a buying situation in which the purchasing department reorders on a routine situation? a) Modified Rebuy b) Straight Rebuy c) Direct Purchasing d) New Task 2. HSBC bank adopts marketing concept, which of the philosophies is appropriate from the following a) Customer is always right b) Profit is our sole motto c) Selling goods at any cost d) All the above 3. _______are people who decide on product requirement or on suppliers in the business buying process? a) Initiators b) Deciders c) Approvers d) Gatekeepers 4. ____________is the management process responsible for identifying, anticipating and satisfying customer’s requirements profitably? a) Marketing Strategy b) Marketing Information c) Marketing d) Marketing Research 5. __________ decides the various goals and plans that the organization will follow? a) International Marketing b) Marketing Strategy c) Marketing Communication d) Marketing Research 6. Five Ms of advertising are mission, money, media, measurement, and? a) Message b) Market Testing c) Material d) Manage 7. Physical concrete product that you can touch is called as a) Core Product b) Augmented Product c) Tangible Product d) Potential Product 8. Programs aimed at promoting or protecting a company’s image in the minds of its publics are collectively called _________ a) Trade Promotion b) Public Advertising c) Sales Promotion d) Public Relations 9. Tools Inc. buys hammers, bolts and other hardware items and sells them to hardware shops at a price that includes a profit. Tools Inc. would be part of what kind of market? a) Reseller b) Producer c) Institutional d) Government 10. The marketing environment is best described as a) Dynamic and changing b) Composed of controlled variables c) Composed of dependent variables d) None of the above 11. Inelastic demand in industrial markets refers to a situation where a) Demand for a given product fluctuates very little over time. b) Price increase or decrease will not significantly alter demand for a given product. c) Demand for a given product fluctuates wildly over time. d) The demand for one product depends heavily on the demand for another product. e) Supply for a given product cannot keep up with the demand for it. 12. The fact that organisational customers purchase raw materials or intermediate products to be used directly or indirectly in the production of goods and services to satisfy customers' needs means that it is a _______________demand a) Joint b) Economically stable c) Derived d) Inelastic 13. Which is not one of the '4Ps' in the marketing mix? a) Product. b) Price. c) Place. d) Promotion. e) Placement. 14. Levis manufactures jeans for women, men and children. They are adopting which method of segmenting a) psychographic b) geographic c) use based d) demographic 15. Marketing is practiced by: a) Only sales firms. b) All organizations to some degree. c) Only public firms. d) Only profit-oriented firms. 16. Parents Against Drunk Drivers is a group that organizes meetings and discussions to change attitudes and laws about driving under the influence of alcohol. This group primarily markets a) goods b) ideas c) services d) political messages 17. When Campbell's introduced its line of low-sodium soups in response to consumer demand, it was following which one of the following philosophies? a) Selling concept a. Production concept b) Customer concept c) Marketing concept 18. If Nissan finds that it can engineer its Micra to go faster, regardless of whether or not customers are interested in more speed, decides to make this faster model, Nissan has characteristics associated with the ___________ concept. a) production b) sales c) marketing d) social 19 Which action best illustrates a firm’s commitment to the marketing concept? a) The monitoring of consumer satisfaction levels b) The firm is having a large advertising budget c) The existence of a large sales force d) The firm is having a high market share in a niche market 20 Evaluating marketing performance by comparing it to established standards is part of: a) marketing planning b) organising marketing activities c) coordinating marketing activities d) marketing control 21. A marketing manager for a small computer manufacturer is analysing the potential effects of political, legal, social, and economic forces on the firm's operations. The marketing manager is examining the __________that influence(s) the firm's strategy. a) operating situation b) marketing environment c) trends d) economic conditions 22 Emirates charges different prices for Business Class, First Class and Economy class. This type of pricing is called a) Discriminatory pricing b) Perceived value pricing c) Place pricing d) None of the above 23 In what stage of the consumer’s decision process does a consumer compares with the competitors’ product. a) Information search b) Problem awareness c) Evaluation of alternatives d) Decision making 24. In a specific strategic market plan, a profit centre that is self-supporting in terms of sales, markets, production, and other resources is known as: a) profit unit. b) strategic business unit. c) marketing unit. d) small business unit. 25. Eppco. is preparing a written document specifying the framework and actions for implementing and controlling marketing activities. This document is called the a) profit centre. b) marketing programme. c) strategic business plan. d) marketing plan. 26. Corporate strategy planners are concerned with many different issues as they attempt to match the organisation's __________ with the opportunities and risks in the environment. a) strengths b) mission statement c) strategic business units d) resources 27. in seeking to identify new demographic groups who can be encouraged to buy Levi Strauss products for the first time, the company is pursuing which growth strategy? a) Market penetration b) Market development c) Product development d) Diversification 28 A _______________ consists of consumers who respond in a similar way to a given set of marketing stimuli. a) market segment b) market niche c) market target d) market positioning 29. The arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers is called: a) market segmentation b) market targeting c) market positioning d) market positioning 30 Selecting a pricing method depends on which considerations a) Costs b) Competitors c) Price of substitutes d) All the above 31. ______________ are runner-up companies that aggressively attack competitors to get more market share. a) Market leaders b) Market challengers c) Market followers d) Market nichers 32. A major tool of marketing controls is a comprehensive, systematic, independent, and periodic review of the company's environment, objectives, strategies, and activities to determine problem areas and opportunities called the: a) marketing plan b) strategic plan c) marketing audit d) profitability plan 33. Costs that vary directly with level of production ________________ are called a) Product costs b) Total costs c) Variable Costs d) Fixed costs 34 Adding a standard markup to the cost of the product is _________________ a) Value pricing b) Value-based pricing c) Cost-plus pricing d) Breakeven pricing 35 High product quality & Low price means_________________ a) Premium strategy b) Rip off strategy c) Super value strategy d) Economy strategy 36. Low product quality & Low price means_________________ a) False economy strategy b) Rip off strategy c) Super value strategy d) Economy strategy 37. Which of the following is NOT a type of discount on price? a) Seasonal b) Quantity c) Trade d) Quality 38 A ________ pricing objective results in prices being set to recover cash as quickly as possible. a. market share b. product quality c. return on investment d. cash flow 39. For what type of product would you expect demand to increase in greater proportion than the price fall? a) Products with inelastic demand b) Products with elastic demand c) Products with perfectly elastic demand d) Products with unitary demand 40. _____________ consumers are concerned about brand image of the product a) Price-conscious. b) Value-conscious. c) Prestige-sensitive. d) Cost-sensitive. 41. The steps involved in the process of establishing a price include all of the following EXCEPT a. selecting a pricing strategy. b. setting the demand. c. developing pricing objectives. d. determining competitors' prices. 42 Charging more for Snickers chocolate bar in a vending machine than in a supermarket is an example of a. value based pricing b. differential pricing. c. cost-based pricing. d. competition-based pricing. 43. Hertz prices its rental cars to match precisely the prices set by Avis. Hertz is using a. competition-based pricing. b. cost-based pricing. c. demand-based pricing. d. reference pricing. 44. ____________is defined as all activities of designing and producing the container for a product a) branding b) packaging c) labeling d) advertising 45. ________________helps in Informing and persuading customers to purchase products through an interactive relationship in an exchange situation a) Personal selling b) direct marketing c) targeting d) segmenting 46 ____________ is a paid form of non-personal representation of goods, ideas or services a) sales promotion b) direct marketing c) advertising d) exhibitions 47 Which of the following is not an objective of advertising a. inform b. remind c. reinforce d. none of the above 48 The purpose of sales promotion a. varies in their specific objectives b. it is the same for all type of products c. is to reduce manufacturing coast d. is to raise the price 49 an example of psychological pricing would be a. 20% b. 300.00 c. 225 d. 299 50 Channels of Direct Marketing are : a. Face to Face Selling. b. Direct Mail. c. Telemarketing. d. All of the above. 51. Market__________focus on narrow segment. a. Leader b. Challenger c. Nichers d. None of above 52 giving away Nokia phone with a Mercedes car is a) Premiums b) cross promotion c) patronage award d) all the above 53 charging different prices for different customers at different markets and at different times is called a) promotional pricing b) discriminatory pricing c) product mix pricing d) geographical pricing 54 tooth paste tube is an example of a) secondary package b) primary package c) line extension d) brand building tool 55 Mercedes is an expensive, well-built and prestigious car, which also offers the driver High performance, and safety. From this sentence identify the different levels of meaning: a) Attributes & Benefits b) Attributes & Values c) Benefits & Values d) Culture & Benefits 56 Al Massa Cinema’s price for a movie ticket is Dhs 25/- but if a student produces his/her Identity Card they are given a discount. What type of Pricing Method has Al Massa Cinema adopted here: a) Perceived Value pricing b) Psychological Pricing c) Promotional Pricing d) Discriminatory Pricing 57 A period of slowdown in sales growth because the product has achieved acceptance is known as __________ a) -decline b) -maturity c) -introduction d) -growth 58 _______________ virtually depicts the consumer’s perception about different brands & their perceived attributes. a) -direct marketing b) -branding c) -perceptual mapping d) none of the above 59___________ price is based on competitor’s price a) -Percieved value pricing b) -value pricing c) -going rate pricing d) all the above 60___________ includes all the activities that help increasing the awareness of the product in the minds of consumers a) -place b) -price c) –promotion d) –product 61____________ estimates initial sales ,replacement sales ,repeat sales ,calculates various costs ,overheads etc & profits. a) -market testing b) -product development c) -business analysis d) -all of the above 62 A person’s __________ consists of all the groups that have a direct (face-to-face) or indirect influence on the person’s attitudes or behaviour. a) -focus group b) -reference group c) -memebership group d) -business group e) -consumer group 63) Mixing several tools to deliver a consistent brand image to customers at every brand contact is known as __________. a) -customization b) -customer relationships marketing c) -customer database d) -integrated marketing communications 64)_______ has the aim of building mutually satisfying long term relationships with key parties – customers, suppliers , distributors – in order to earn and retain their business. a) -marketing network b) -business information system c) -relationship marketing d) -direct marketing 65 The collection of information about external environment a) Environmental scanning b) sampling c) research d) All of the above 66 _____ deals with implementing the marketing strategy for target markets and marketing mix a) Marketing plan b) communications c) sampling d) none of the above 67 Raw materials, major equipment, component parts and process materials are example of- a. Consumer goods b. Industrial goods c. Process goods d. None of the above 68 Launching a new product at low price and low level of promotion is – a) Slow penetration b) Slow skimming c) Rapid penetration d) Rapid skimming e) None of the above 69 An advertising strategy that a company would use for a product in its maturity stage – a) Reduce in level needed to retain hardcore loyals b) Build product awareness among early adopters c) Build product awareness and interest in mass market d) Stress on brand differences and benefits e) None of the above 70 At Boeing, the all digital development of the 777 aircraft made use of a computer-generated “human” who would climb inside the 3 dimensional design on-screen to show how difficult maintenance access would be for a live mechanic. This allowed the engineers to spot errors that would have remained undiscovered. What stage of the new product development is Boeing in – a) Concept development b) Concept screening c) Concept testing d) Product development e) None of the above 71 Nabisco Foods Company introduced chocolate, cinnamon, and honey versions of breakfast cereal. However, the consumers didn’t like the taste so the modified it again and produced it on a mass scale with the result being worse than before. Where did this food company go wrong a) Their product is in the decline stage b) They didn’t advertise properly c) They didn’t promote the product d) They skipped the testing phase of the product e) None of the above 72 Many consumer packaged-goods companies blame _____ for decreasing product loyalty, increasing consumer price-sensitivity, brand-quality-image dilution, and a focus on short-run marketing planning. A. reminder advertising B. infomercials C. persuasive advertising D. public relations E. sales promotions 73 Maytag has long built high-quality washing machines and priced them higher than competitors’. It now tries to emphasize on innovative features. It new ads points that the washers are custodians of high priced garments. Which type of pricing is Maytag using – a) Market skimming pricing b) Market penetration pricing c) Social pricing d) Cost recovery pricing e) None of the above 74 In order to select a pricing for a product, after estimating all your costs what would be the next logical step to take – a) Selecting a pricing objective b) Analysis of competitors price, costs and offers c) Selecting a pricing method d) Estimate indirect cost e) None of the above 75 Which one of the below doesn’t refer to a pricing method – a) Geographical pricing b) Promotional pricing c) Price discounts and allowances d) Discriminatory pricing e) None of the above 76 The part of a brand that is pronounceable is called the: a) Brand b) Brand name c) Brand mark d) Trademark 77 The golden arch of McDonald’s is an example of: a) Brand marks b) Trade promotions c) Brand names d) Products 78 The introduction of diet coke is an example of a: a) Brand extension strategy b) Repositioning strategy c) Product deletion decision d) Product distribution strategy 79 When Disney uses toys in McDonalds kid’s meals to advertise its latest movie, Disney is using: A. tie-in promotions B. prize promotions C. point-of-purchase promotions D. cross-promotions 80 When compared to the consumer market, the demand for goods and services in the business market is: A. far more elastic B. significantly more constant C. derived D. more likely to be affected by changes in price E. all of the above 81 Interest rates, demand for products, technological change, social responsibility concerns, and consumer buying patterns are all examples of _____ influences on business buyers. A. environmental B. interpersonal C. organizational D. entrepreneurial E. individual 82. Forecasting is done always on a continuous basis a) true b) false 83 A finance company that offers prospects a toll-free number to call and promises it can tell them within fifteen minutes if they are eligible for a loan is using ____ as its services differentiation strategy A. customer training B. ordering ease C. installation D. delivery E. distribution 84 Profits improve substantially during the _____ stage of the product life. A. introduction B. repositioning C. growth D. maturity E. decline 85 The stage of the life cycle characterized by low sales, heavy promotion, low profit, and minimal competition is the _____ stage. A. introduction B. growth C. repositioning D. maturity E. decline 86 A firm that wants to attract new triers, reward loyal customers, or increase the repurchase rate of occasional users would be best served by: A. personal selling B. direct marketing C. advertising D. sales promotion 87 The necessary interaction between service provider and customer that allows a service to be delivered is called a. service exchange b. customer contact c. Degree of labor intensiveness. d. Customer interactivity. 88 a separate product line or profit center competing with defined sets of competition is called a strategic business unit A. true B. false 89. It took three and a half years of research, and 500 formulas, to develop individually wrapped peanut butter slices. The difficulty was in finding a formula that preserved the flavor and texture of peanut butter, but had the "releasability" required for easy separation from a plastic wrapper. This describes the _____ stage of new-product development. A. idea screening B. product development C. concept testing D. market testing 90 When Procter & Gamble developed Crest Whitestrips (a teeth whitening system), it was not sure that consumers would be willing to pay $44 for the system. So its product manager offered the strips exclusively online. In eight months, it sold 144,000 whitening kits to a heterogeneous market. P&G used _____ testing to determine if the teeth whitening system would sell. A. market B. functional C. alpha D. rank-order E. concept 91. Which of the following is the BEST example of durable goods? a) living room furniture b) aluminum cookware c) breakfast cereals d) computer monitors e) all except (c) 92. Brand equity: A. is tied closely to specific product lines B. is closely related to the number of customers who are devoted to the brand C. reduces the amount of product management effort a company needs to expend D. may actually hinder the launching of brand extensions E. will be destroyed when the product’s manufacturer launches a premium pricing strategy 93 Thuraya services of Etisalat shows business communications for every corner of the earth . This advertisement is based on which appeal A. rational B. practical C. reciprocal D. emotional E. provocative 94 The business market differs from the consumer market in that: A. businesses acquire goods or services in order to use them for another purpose, while consumers acquire goods or services for personal consumption B. businesses acquire all the goods or services for personal consumption, while the consumer market acquires goods and services solely for other purposes C. it is a much smaller market in dollar volume than the consumer market D. more product customization takes place in the consumer market 95 The zoo buys much of the fresh food it needs to feed its animals from a local farm. As a part of the contract between the two parties, the farm buys all the manure the zoo can produce for its organic vegetables. This is an example of:indirect purchasing relationship marketing A. leasing B. systems selling C. reciprocity D. none of the above 96 The most routine purchase decision process undertaken by business buyers is called a: A. straight rebuy B. modified rebuy C. new task buy D. routine rebuy E. direct purchase 97 The Knoll Textile Manufacturing Company is evaluating potential suppliers of zippers to be used in a line of children’s outerwear. The company is concerned about the delivery reliability, price, and supplier reputation. Knoll is in the _____ phase of the business buying process. A. supplier selection B. proposal solicitation C. product specification D. performance review E. order-routine specification 98. which is not a basis of market forecasting a) product scale b) time scale c) space scale d) pricing scale 99 According to the concept of the product life cycle: A. products have a limited life B. products spend a predetermined amount of time in each stage of the life cycle; this time span is determined by the product category C. most products require the same level of marketing throughout their life cycle D. a product’s profits are fixed throughout its life cycle 100 Several existing products on the market tend to hinder new-product development. These hindrances include: A. fragmented markets B. shorter product life cycles C. shortage of ways to improve or modify certain products D. faster required developmental time E. all of the above