Analyzing Marketing Opportunities

Analyzing Marketing Opportunities Marketing has often been defined in terms of satisfying customers needs and wants critics however maintain that marketing goes beyond that and creates needs and wants that did not exist before. According to these critics, marketers encourage consumers to spend more money than they should on goods and services they really do not need. Marketing was defined by the American Marketing association Board of Directors as Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. (Approved October 2007) http://www.marketingpower.com/aboutama/pages/definitionofmarketing.aspx Marketing is the process whereby society, to supply its consumption needs, evolves distributive systems composed of participants, who, interacting under constraints technical (economic) and ethical (social) create the transactions or flows which resolve market separations and result in exchange and consumption. Bartles2 What Is Marketing? How 10 Experts Define It Marketing Process The marketing process consists of analyzing marketing opportunities, developing marketing strategies, planning marketing programs, and managing the marketing effort. (Kotler)3 http://nraomtr.blogspot.ie/2011/12/marketing-strategy-marketing-process.html Analyzing Marketing Opportunities Market analysis involves market research about a product or service being offered it involves using primary and secondary data, looking at the economic situation of the country and the legal aspects political aspects, the legislation the competitors new entrants into the market and their market position. This data will be analysed using different statistical tools this will be used in identifying short, medium and long term on various marketing activities. This data provide useful information which enables the organisation to plans its marketing strategy. For example Tesco a grocery store will look at what Asda, Lidl Aldi and also what the likes of Sainsbury, marks and spencer are doing and their market share. Its in view as this that Tesco will determine what its marketing strategy will be. Developing Marketing Strategies Based on the Marketing research conducted Tesco will be able to determine what marketing strategy it will adopt for the next quarter on each of its product range and determine what market segment it will concentrate on. it might decide to contrate on fruit and vegetables or it might decide to concentrate of clothing differentiation decision is made to arrive at a product that will lead to the optimal profit. For example Tesco might decide to be a loss leader on a particular product while maximising profit in other areas Usually at Tesco price of some items are reduced but customers will come in because of this package but will end up buying other not discounted. Marketing Programs Marketing strategy leads to marketing mix, examples are budget allocation for a particular department, products etc Marketing Mix is the combination of four elements, called the 4Ps (Product, Price, Promotion and Place), that every company has the option of adding, subtracting, or modifying in order to create a desired marketing strategy. (Philip Kotler)4 Larry Steven Londre Marketing, IMC, Advertising, Promotion, Media and More. 2012 Edition There are large number of marketing tools. McCarthy5 provided a categorization for them in terms of four Ps of marketing: Product, price, place and promotion. Under each P, there are number of tools. Depending on the organisational choice it is possible to have some on a short term medium term or long term new products are usually on a long term basis In other to carry out budgeting for different marketing tools, sales functions this functions will relate to how sales will be affected be any incremental amount, This is known as sensitivity analysis. Product related marketing tools are in the form of quality,branding design,packaging, etc. While price related to commissions, discounts and middlemen commission to discount pricing like buy one and pay for I/2 price for the second. Place related are like on line sales Tesco in retail park, Tesco in large shopping centres and the Tesco express which can be in filling stations or in a neighborhood Promotion relates to Tesco club card owners who get personal sales promotions or instore promotions and TV and radio jingles or adverts, online and social media campaigns. Market Orientation was defined by McNamara (1972 p.51) as a philosophy of business management based upon a Company wide acceptance of the need for a customer orientation. Profit orientation and recognition of the important role of communicating the needs of the market to all corporate departments .5 Journal of marketing april 1990 Ajay Kohl and Barnard J Jaworski Market Orientation: the construct, research proposition and managerial implications The main points highlighted here are customer focus and profitability. The chances of new products failing is very much reduced and it provide the opportunity to cut its loss if indications are it may not be profitable the a stop can be put to it before the product is launched Where market Orientation approach is used there chance that consumer needs are being met with appropriate products or services are higher and inevitably the life product of such products or service will be prolonged and hence more profit. . Constant feedback from consumers This is an unending process through this constant market research this will enable the firm to make changes to the product as its see fits hence making higher profits and matching those of their competitors.. The disadvantages of marketing Orientation are It may be difficult to target campaigns at a large Market Constant market research it is very expensive thereby reducing profit* Where there is a specialised markets it will be difficult to fulfill the needs of the sub market(consumers) A good example of this is the graphic plotters used for architects similar plotters may not be ideal for factories with specialised technical construction or tool making. Product differentiation may at time be difficult especially for the likes of retail supermarket where they do not produce the products but for the company branding it is often difficult to differentiate a product and stand out from competition consumer wants often change due to income and consumption patterns for example someone who lost his/her job will change quickly from buying from Tesco to the likes of Lidl and Aldi. it may be hard to keep up with need of such people. Marketing environment is mainly made of two variables the micro and the macro factors these factors are mainly internal environment- micro and external environment macro The micro environment are variables that can be controlled or by management. E Jerome McCarthy 6 said the variables that the company can control in order to reach its target market are the four Ps. Price, products, promotion and place. A Communication-Based Marketing Model for Managing Relationships Tom Duncan and Sandra E. Moriarty Journal of Marketing Vol. 62, No. 2 (Apr., 1998), pp. 1-13 Macro are those outside the control of the organisation.they are proximate macro-environment The supplier environment The distributive environment The wider macro-environment Demography proximate macro-environment This involves the external forces for example, in the legal, cultural, economic and technological sub-environments. This are the people or firms with organisation immediate external environment. Of they are marketing firms, are suppliers, competitors and distributors (intermediaries). The supplier environment These are businesses that provide the firm with material and distribute to their retails in includes logistic companies and retailers the like of Tesco The distributive environment Emphasis is placed on intermediaries such as wholesalers, factors, agents and distributors so that final consumer get products The competitive environment The threat of competition cannot be over emphasised the orgainsation must be alert to the potential threat of other companies selling the same product. Ie Pepsi and Coke companies marketing similar and substitute product whether they are of domestic or foreign origin. The wider macro-environment Changes in the wider macro-environment may not be as close to the companys day-to-day operations, but they are equally important this falls into four The main factors making up these wider macro-environmental forces fall into four groups. Political and legal factors Economic factors Social and cultural factors Technological factors Demography In places like Iran, Tunisia, Syria and the middle east in general which were predominantly dominated by Pepsi, the advent of war has change the demography of the area. This is out of the control of Pepsi and It will have to readjust its marketing strategy and marketing Mix for this region. Market segmentation is defined as The process of defining and subdividing a large homogeneous market into clearly identifiable segments having similar needs, wants, or demand characteristics. Its objective is to design a marketing mix that precisely matches the expectations of customers in the targeted segment. 7 Read more: http://www.businessdictionary.com http://www.coriolisresearch.com/pdfs/coriolis_tesco_study_in_excellence.pdf Fig 1 http://www.coriolisresearch.com/pdfs/coriolis_tesco_study_in_excellence.pdf Fig2 http://www.coriolisresearch.com/pdfs/coriolis_tesco_study_in_excellence.pdf (source) Gig 3 http://www.coriolisresearch.com/pdfs/coriolis_tesco_study_in_excellence.pdf Tesco provided six market segments to target the different consumers Need from the up class to the lower class income . The segments are self narrative with this concept Tesco was able to continuously increase its market share. Buyers behaviour often change depending on products , the consumers spending power, consumers needs and how urgent he need the product. The customer identifies a need :This often occurs from advertisement from TV, Radio, Bill board social media or words of mouth Looking for information At this stage the customer wants more information about the products and needs to see the product and discuss more with the sale representative Checking out alternative products and suppliers The consumer at this stage will look for a better buy either in terms of quality, pricing and will compare the product or service with those of other providers, Purchase decision . time at this stage the buyer is ready to buy and the sales personnel need to close the sale by giving the buyer an incentive to buy. It could be after sales service it could be a voucher. Using the product Cognitive dissonance a fear that the buyer may have made a wrong decision comes to play here especially when it is an expensive here simple how to use and after sales suffice or a form of warranty. There are four main factors that affect a buyer behaviour namely:-Social, Culture, psychological and personal.. Social: Groups membership, reference, aspirational opinion leaders or buzz marketing and family members. Culture: A persons wants or behaviour group with share values and ones social class. Personal; Age and life cycle, occupation personality and self concept Psychological: Motivation perception and beliefs and attitudes . Market positioning is the manipulation of a brand or family of brands to create a positive perception in the eyes of the public. If a product is well positioned, it will have strong sales, and it may become the go-to brand for people who need that particular product. Poor positioning, on the other hand, can lead to bad sales and a dubious reputation. A number of things are involved in market positioning, with entire firms specializing in this activity and working with clients to position their products effectively. 9 http://wiki.answers.com/Q/What_are_examples_of_market_positioning With the current economic situation Tesco has gone to the cheap end of the market competing the likes of Lldl and Aldi. So the focus will be on main stream with competitive price