Marketing BUSS3

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Understanding M/O - Possible Objectives

1) Market Share : maintain/increase 

   Ensuring competitors not threat + increase % of total market control

2) New Markets : target new markets or segemnts within existing 
    Market saturates -> sales decline -> company change target audience both home + overseas

3) Product Development : Develop new goods/services through market research/tech advances
     = replenishing. Done b.c product reaching end of lifecycle or competition fierce 

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Influences on M/O - Internal

1) FINANCE : £ available / budget for marketing - size determines success:
higher budget = more profitable. IF sales + market share falling = more allocation, but if no £ then illogical

2) HR : Skills of workforce can limit what business is able to do. E.g. no use implementing tech advances if workforce lack skills. H/e workforce could be under-utilised resource --> could give competitive advantage over competitors.

3) OP ISSUES : quality + capacity considered. E.g. obj: intro new product to range but manufacturing capacity to be checked to cope with extra customer numbers.
+ objective of quality improvement incorporated into market planning.

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Influences on M/O - External

1) Competitors Actions : current / future 

  • Assessment of their marketing mix, pricing, promotion, distribution, product policies + overall spending on marketing.
  • Major promotion by one firm followed by rivals - price wars, supermarkets 

2) Technological Change : computer-aided manufacturing = reduce labour costs + production time / may open new markets, ability to compete in low-cost market

  • BUT product lifecycle shortened + product obsolete impacting marketing obj's.

3) Marketing Factors :

  • Economic climate  E.g. if marketing strategy is product dev + ec. climate in slowdown then products offering savings preferable to luxury products / HOW MUCH DISPOSABLE INCOME
  • Social change - E.g. fair trade 
  • Consumers' needs e.g. children living in family homes changes housing type demand
  • Legislation e.g. EU recycled packaging regulations - change in materials of packaging products
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Analysing Markets + Marketing - Market Analysis

Definition: detailed examination of the features of a market such as market size + sales used to predict future sales.

Aspects analysed : size of market (value), growth, segments divided into

Why :

  • Ensure good understanding of customers.
  • Helps planning process b.c will enable bus to assess situation + carry out SWOT
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Methods of analysing market

1. Moving Averages = technique for identifying underlying trend by smoothing out fluctuations in data.

2. Extrapolation = prediction of future trend based on an identified current trend.
Minus 1st trend from last, then divide by how many jumps = extrapolated = amount increased every time

Helps marketing function, distribution + promotional strategies, budget setting, workforce + production planning b.c have idea of future sales.

Helpful in slow-moving + stable markets. Difficult + misleading to predict in high-technology dynamic markets with rapid change + short product life cycles 

3. Correlation = aparent statistical relation btwn 2 factors (variables) which can be +ve or -ve.
a) Positive (direct relationship, b) Negative (inverse relationship), c) No correlation (no link) 0 

Helps identify most sig. factors affecting demand + sales, become part of marketing tactics to achieve M/O. To be treated with caution, not always accurate 

Concept of correlation coefficient : how close a fit is the line to it

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Difficulties in analysing marketing data

Marketing data : info a/b response to the marketing acitivites of bus.

- Shows no cause and effect

- Essential to know things that affect demand - price, fashion, advertising etc. 

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Use of information technology in analysing markets

Market research conducted through EPOS + online questionnaires & processed + presented through software packages. Business 'blogs' obtain feedback.

+ Info processed quickly, used for sales forecast - extrapolating, moving averages + correlation

+ Info can build electronic consumer buying behaviour database + detailed customer profiles to target products and promotions efficiently.

- Info overload = slow down decision-making, conclusions less only stream of data - potential opportunities missed exploited by competitors.

- Data available very quickly - risk of decision-makers overreacting, misinterpreting apparent trends = unfortunate decisions.

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Selecting Marketing Strategies - Low Cost v. Diffr

Marketing Strategy : plan of how the marketing objectives are going to be achieved. 

Low cost : offer products @ lower price than competitors - must reduce own costs, EOS (find low cost suppliers/moving operations to low-cost location) / Quality? Reduce long term costs? 

Diffrentiation : make one product different + superior to others on the market. All marketing mix + patenting new invention, developing USP, building strong brand image. Pricing reflects exculsivity + superiority + distribution strictly controlled to maintain image.

Both apply to both niche and mass markets.

National or International? 

  • E-commerce allows medium-sized firms to attract customers from all around the world, attractive opportunities for large firms.
  • Expansion of EU will encourage UK companies to think in int'l context
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Ansoff's Competitive Strategies

Definition : way of classifying marketing strategies in terms of existing + new products in existing + new markets. Degree of risk involved in each strategy is an important element of analysis.

Suggests risk increases as strategy moves further away from present product, present market option.

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Market Penetration

Increase sales of current products to existing customers + attract new customers from competitors in market. 

- Reducing prices to encourage customers to buy more / entice consumers from other brands
- Increase promotional spending - remind a/b product range
- Launching loyalty scheme
- Increasing activity of sales force
- Making small changes to products on offer 
- Giving customers greater range of buying options, increasing places from where can be purchased.

Lowest risk b/c bus has experience of the market + know characteristics of customers.

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Product Development

HIGHER RISK - selling new products to existing customers. 
New product line not minor changes to existing product 

+ May allow bus to utilise excess production capacity
+ Respond to new product launch from competitor
+ Maintain reputation as innovator 
+ Exploit new technology 
+ Protect overall market share 

Size of market noted - national/int'l?

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Market Development

Strategy involves attracting new customer groups to existing product
Increase sales of current product portfolio

  • targeting diff geographical area - overseas market
  • developing new sales channels - ecommerce, new audience
  • targeting new consumer group with diff profile to existing customers


  • Risky b.c company will have little/no knowledge a/b new market.
  • The marketing costs could be high 
  • Time taken to achieve profit in new market potentially high


  • Potential gains = attractive 
  • Helps spread risk - if one geo market suffering from poor ec. growth, another expanding rapidly - so impact of economic slowdown on business reduced.
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Most risky! 

  • Firm moves into new market with new products - may or may not be related to existing products and markets.
  • Little opportunity to use existing expertise products/markets
  • related, forward, backward, horizontal integration (becomes involved in activities of customers/suppliers/competitors)
  • unrelated - highest risk; no experience/detailed knowledge of key success factors in market although evidence that can lead to fastest growth

    + Risk spread, 'first mover advantage', in emerging market no company has expertise/EOS = competing on 'level playing field'

Strategies =
new tech dev by R+D dpt of bus or bought from inventor (risk reduction if evidence of potential)
buying existence business in different market - if acquisition successful, risk reduced.
targeting existing successful markets - business has strong brand, risk reduced.

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Steps of Marketing Plan

1. Set marketing objectives 
2. Gather Market data and Analyse it
3. Set the strategy
4. The Marketing Budget 
5. Marketinng activities / Tactics 
6. Review results (and change if needed)

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Elements of Marketing Plan

Marketing Objectives, SWOT analysis, situation analysis (builds on SWOT), sales forecast, marketing strategies & tactics and budgets

Marketing Budget = quantificable financial target set by firm in relation to firms marketing acitvities. Size depends on:
- competitiors spending 
- expected returns (success = higher marketing expenditure)
- current financial position of business 

Sales forecast = back-data: successful marketing plans from past form basis of future plans + mistakes identified and eliminated - employees use expertise = confidence a.b success of MP
- current trends & future expectations - extrapolation, moving averages etc - predictions not exact, but valuable.

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