Role of marketing and its role in the achievement
- Direct effect on profitability and sales
- Objectives should be S M A R T (Specific, Measurable, Achievable, Realistic, Time)
- Objectives aim to grow sales, Increase profits, Build customer awareness
- Marketing is about understanding customers,and meeting the needs and wants of customers
- A marketing orientated business is one that which has adopted the marketing concept
-Businesses communicate with customers through advertising and other marketing promotion
Purpose of marketing
Marketing plan is useful to many people in a business. It can help to:
- Identify sources of competitive advantage
- Gain commitment to a strategy
- Get resources needed to invest in and build the business
- Inform stakeholders in the business
- Set objectives and strategies
- Measure performance
- Segmentation involves dividing markets into groups with different needs.
- To deliver tailored propositions which meet these needs as precisely as possible.
- A market segment can be defined as a customer group within the market that has special characteristics which are significant to marketing strategy.
Reasons for segmenting customers:
- Customer needs differ. Creating separate offers for each segment provides customers with a better solution.
- Customers have different disposable income.By segmenting markets, businesses can raise average prices and subsequently enhance profits
- Market segmentation can build sales. E.g. customers can be encouraged to "trade-up" after being introduced to a particular product with an introductory, lower-priced product
- Customer circumstances change, e.g. they grow older, form families, change jobs, change their buying patterns.
- Businesses need to deliver their marketing message to a relevant customer audience. If the target market is too broad, there is a strong risk that (1) the key customers are missed (2) the cost of communicating to customers becomes too high / unprofitable.
- Better matching of customer needs,
- Enhanced profits for businesses,
- Better opportunities for growth,
- Allows businesses to develop products that more closely meet customer needs,
- Allows businesses to carefully promote their products to a specific audience
- Market share can be defined as the percentage of all sales within a market that is held by one brand / product or company
- Market share can be measured by 1)sales volume 2)sales revenue
- Total sales of all the firms in a given market. Market size by value is found by multiplying the number of units sold by price.
- Market share can be measured by the number of sales divided by the total market size X 100
- Cultural factors (social class/ religion)
- Social factors (family/ status)
- Personal factors (Age, Demographic)