BTECH business-topic 2


Marketing Principles

Marketing as an exchange process - buyers and sellers exchanging goods for money 

  • Marketing involves a management process - if managed correctly, marketing will encourage peoople to want to do business with the organisation 
  • Marketing involves identifying, anticipating and satisfying customer requirements 
  • Marketing allows for successful exchanges between the organisation, it's customers and suppliers 

What influences customer expectations 

  • price 
  • product requirements 
  • previous experiences 
  • promotional material 
  • competitor activities 
  • Views of others 
  • After-sales support 
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Marketing Principles

Making customer's satisfaction should be a key business objective 

The business must ensure that they practice secure customer retention - recruiting new customers is far more-costly than keeping the existing customers 

Internal service provision- Internal services are delivered between departments in the same organisation 

  • Links between marketing and finance, human resources and operations is important for information sharing and other activities 
  • Links between the organisation and the customer by multiple contact points e.g. adverts, visiting websites and social media posts 

B2B and B2C 

Multiple contact links can include research staff, shop assistants, website managers, accounts department, receptionist who can change the way a customer percieves the business and can make or break a deal. 

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Marketing Principles

McDonalds example: 

McDonalds is considering introducing a new burger to the UK called the McSupremes. It has more salad than before, different salad toppings, and aged beef patties. Explain how much Mc D's would need to adapt a cross functional approach when considering the launch? 


  • Maintain a low-end price, as well as ensuring a profit can be made 
  • Must maintain a higher price than usual food items to reflect significance amongst menu and for a premium look 
  • Suitable low price for target market 


  • Must ensure that the meat can be supplied in a large amount to their particular specification of aged beef and due to believed high demand that the food will gain 
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Role of Marketing Department

Role of Marketing Department 

  • Providing information internally- as the marketing department focuses on the external environment they can deliver important information to other functions so they can react quickly; 
  • Promotional campaigns 
  • Relationship with distributors and retailers 
  • Customers prefrences and problems 
  • Competing products 
  • Oppotunities 
  • Emerging Trends 

The role and function of marketing within organisations 

Internal customers involves engaging employees and keeping them informed so that they can respond effectively to customer requirements and will have a common view of the business's mission. 

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Role of Marketing Department

External customers can be divided into groups (market segments) so that they can be managed and their expectations can be met more easily. 

It is important for a business to understand both internal and external customer's needs and wants e.g. suppliers, warehouse operatives, customers etc. and then a business can make sure that each customer gets the right message. 

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Key components of the marketing environment and th

Customer needs and wants 

  • Functional Benefits-  Tangible benefits delivered by a product/service e.g. buying a suit will help a person feel smart in the workplace as well as fulfilling a basic requirement e.g. immodium 
  • Emotional Benefits- A product/service/brand which gives someone a positive emotion about themselves when using it e.g. a chocolate advert 
  • Physiological needs- Basic requirements of survival, water, food, shelter etc. - e.g. nutrition tips 
  • Social and cultural forces -  Values of the group - e.g. diverse britain 
  • Luxury or necessity- Needs/wants - e.g. watch 
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Customer Buying Process

Stage 1: - Problem/need recognition 

Stage 2:- Information search and processing 

Stage 3:- Identification and evaluation of alternatives (decision criteria) 

Stage 4: - Purchase Decisions 

Stage 5:- Post purchase evaluation 

E.g. Buying a car 

Stage 1: - Need for a car due to being 17 

Stage 2:- Searching for sale sites and car dealerships for cars within price range 

Stage 3:- identifying cars which i liked to drive and liked the style of, shortlisting cars 

Stage 4: - deciding which car was within my price range and offered right cost for insurance

Stage 5:- Left a review on the car dealership site that i brought my car from -positive experience

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Influences on consumer decision making


Social groups, virtual groups, family 


Subcultures, ethnicity, country of origin 

Personal influence 

Personal values, ethics 

People and personalities who influences decisions 

family/friends/celebrity endorsement 

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The differences between consumer (B2C) and busines

Emotional - Tends to be B2C versus rational behaviour which is B2B 

Purchase size and value 

B2B larger quantities and bigger budget 

Decision making units 

B2B - fewer buyers but more people involved in purchase decision 

Relationship status between organisation and buyers 

B2B delivery and discounts can be flexible but other procedures are set 

Marketing communication inputs and tools- Different methods used depends on B2B/B2C e.g. Trade shows vs TV 

B2B more formal and structured, more negotiation and procedures 

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Collecting relevant information about the marketin

Secondary data sources 

Internal - Customer data, financial data statements, product data and HR data 

External- Goverment, media, commercial (websites and brochures), academia 

Methods used for quantitative research: 

Closed question surveys: 

  • Face to Face 
  • Telephone and mobile/smartphone
  • postal 
  • online 
  • omnibus survey - conducted by phone, email or internet. Data is collected on a wide range of topics and surveys can be tailored in different ways to suit various client's requirements cost effectively 
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Collecting relevant information about the marketin

Methods of qualitative research 

  • Individual depth interviews 
  • Panels / focus groups
  • observational research 
  • group discussion 
  • Internet based- online group discussion, chat rooms, social media research 

Data reliability 

Souce accuracy and bias 

  • Primary - leading questions, body language, tone of voice etc. could sway decisions 
  • Secondary - Incorrect information published, out of date or bias to favour a belief or idea 
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Data Reliability


Needs to be fit for purpose. Method used to collect the data has to produce desired results 


Making sure that out of date data is not used, especialy in a rapidly changing environment 

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Key components of the marketing environment

Macro environment 

Broad factors that are external to an organisation's markets and industry e.g. laws, regulations, changes to the economy and new technologies 

Micro environment 

Close external factors e.g. customers, competitors, distribution channels, suppliers and other stakeholders 

Together the micro and macro environments make up the external environment 

A business cannot control factors in the mircro and macro environment, but the macro factors are more difficult to gauge

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Elements of the macro environment

PESTLE analysis can be used to structure the macro environmental influences upon a buisness 

Political - goverment and policies 

Economic- national economic activity, taxation 

Social- Cultural, lifestyle changes 

Technological - digital communications, production and service technology 

Legal - laws affecting organisations 

Environmental- sustainability 

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elements of the macro environment

Micro environmental factors that affect a business are: 

Customers- purchasing prefrences and actions 

Competitors- price and non-price methods of competition including disruptive methods 

Suppliers- quality and cost of materials 

Intermediatries- assists in getting or distributing the finished product or service to the customer e.g. wholesaler, distributor 

General Public- Public relations and image 

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Elements of the internal environment

Elements of the internal environment

Once businesses have identified the factors in the external environment that will affect it, they now need to understand what assets and capabillities the business have to operate successfully

Resources- Financial and non-financial support 

Skills/People- Proactive or reactive 

Equipment-  current flexability and performance 

Systems/processes-  for supporting an efficient operation 

Internal elements-  enabling or restriction successful marketing e.g. leadership culture, vision and strategy 

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The importance of understanding the marketing envi

  • Supports decision making 
  • Gives Knowledge of situation and changes 
  • It aids strategic 'what if' planning 
  • Provides information to complete a SWOT analysis for the business 
  • Enables Resources to be prepared 

Resources from the internal environment used to navigate the business through these environments 

  • A professional and trained after-sales team to ensure each customer has been contacted should any queries or problems occur with their purchases from the business and a trained environmental team to work on lowering their carbon footprint 
  • Focus groups for ideas relating to consumers average apend and the price in which they are prepared to pay for the devices in which they purchase from the business 
  • Financial support 
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Concept and Elements of the marketing mix

Product diffrentiation 

  • This occurs when a business makes distinctive products, which provide customers with benefits that cannot be matched by competitors products 
  • USP 



Core product- The basic product function e.g  TV = function of playing moving pictures 

Augmented Product- The additional features of a product on top of it's core function e.g. heated seats in a car 

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Price (7P's)

  • The law of demand says that the quantity of a good demanded product falls as price rises, and vice versa 
  • The law of supply states that the quantity of a good supplied product rises as the market price rises, and falls as the price falls 

Image result for the law of demand and supply graph

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Price (7P's)

Equilibrium is defined to be price-quantity pair where the quantity demanded is equal to the quantity supplied. 

It is better for a business to have more supply than demand to acheive maximum sales and reduce the risk of lost sales 

Pricing strategies 

  • Cost-plus 
  • Competitor based 
  • Customer based-expectations (research) 
  • Pysological 
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Promotion (7P's)

Communication with customers and markets 

  • Advertising 
  • Sales promotions 
  • personal selling (car salesmen) 
  • Public relations 
  • direct marketing
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Place (7P's)

Route to market and physical location 

  • Distribution 
  • Delivery 
  • Availability 
  • Reliability 
  • Intermediatries - retailers, wholesalers, agents and brokers 
  • Direct sales 
  • Channels of distribution 
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People (7p's)

Role in satisfying customer needs 

  • Employees interacting with customers
  • Consistency in service 
  • Creating relationships and customer royalty 
  • understanding and dealing appropriately with customer needs
  • Increasing customer satisfaction 

e.g. Ryanair compared to British Airways 

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Process (7p's)

Influence on effective delivery 

Takes form throughout interactions: 

  • Employees interacting with customers/automated systems 
  • Phoned or used websites for information 
  • Ordering/Payment 
  • Delivery- e.g. Amazon Prime 
  • After-sales service 
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Physical Evidence (7p's)

  • In the service industries, there shouuld be physical evidence that the service was delivered e.g. receipt/email 
  • Additionally, physical evidence pertains also to how a business and its products are percieved in the market place 

It is the physical evidence of a business' presence and establishment. A concept of this is branding. For example, when you think of 'fast-food', you think of McDonalds. When you think of sports, the names Nike and Adidas come to mind. 

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Benefits of a coordinated marketing mix

Synergy - Building together components to produce a larger benefit 

Coorporate Focus- Full understanding about the origins actions and products offered 

Budget Economies- Intergrating elements can bring financial benefits e.g. greater efficiency as less resources wasted. 

Clear Brand Image 

Competitive advantage 

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Marketing Mix in different Contexts - Fast Moving

Fast moving consumer goods are regularly purchased essential and non-essential products such as food and drink

Non-durable product 

  • A good which is immediately used by a consumer or which has an expected lifespan of three years or less 
  • They include fast-moving consumer goods such as cosmetics and cleaning products, food, condiments, fuel, beer, cigarettes, medication etc. 
  • Long lifecycle e.g. coca-cola 
  • Usually have many variations and risk of customers switching can be high. 

Determining a marketing mix for these products is important. Businesses try to move buying decisions for these products from a physiological one to an emotional one e.g. buying Moet & Chandon champagne to impress friends. Therefore, quality and other elements of the marketing mix need to be consistent with the image. 

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FMCG- mass promotion and customer as a consumer

Mass Promotion 

  • Most common form is advertising and sales promotion 
  • As FMCG's are consumed by larger segments of the population, promotion needs to reach as many people as possible. 
  • Packaging must also be effective as there can be up to 40,000 different products trying to attract a buyers attention. 

Customer as a consumer 

Often the person buying the product is the one that consumes it, so the marketing mix must appeal to the market 

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The marketing mix for B2B

Marketing mix elements to B2B contexts 

B2B examples: other organisations, charities, goverment departments or local authority 

Price and negotiation 

Bids are usually placed for contracts. Prices can be negotiated due to quantities purchased 

Personal selling and trade promotion 

  • Sales team will develop strong relationship with decision making unit 
  • Key accounts manager will usually oversee 
  • Trade popultion, brochures, trade exhibitions and targeted online advertising commonly are used 

Relationships and service 

Long relationships, established, long negotiation periods, long contracts - after sales service is highly important 

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Service Characteristics

Marketing mix elements for services 

Services can hold - education, tourism, healthcare, hairdressing and also business services such as advertising, market research, consultancy, financial services etc. 


  • No physical product until the service is delivered. Physical evidence plays a significant role here e.g. restaurants 


  • The service is consumed as it is purchased which links to people and process - e.g. a meal ordered and served will not be eaten by another person 


  • (Variable) - people will not always have the same experience (process/people) 
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Services - extended marketing mix

Extended marketing mix 

  • Physical evidence - plays an important role. service sectors will have uniforms and premises designed to give a certain image 
  • People- Critical as services usually involve a high amount of human contact 
  • Process- ease of use e.g. seamless service when checking into a hotel

Service Quality 

Marketing mix needs to be designed to reinforce the customers perception of quality 

  • Five demensions include: 
  • Be reliable - consistent quality of service 
  • Responsive - ask and likely to get 
  • Staff should have knowledge and skill
  • Make customers feel cared for, giving individual attention 
  • Tangible elements need to be consistent
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