Marketing as a Very Crucial Activity in Any Business - Assignment Example

? Marketing Short Answer Questions The world of business is highly competitive in nature. For the purpose of generating and deriving their own competitive advantage companies often engage in a variety of tactics. One of the most common tactics is the SWOT analysis. The SWOT analysis represent the analysis of factors of strength, weakness, opportunities and threats that are existing in the marketplace with regards to the characteristics of the organization. It is highly relevant to say that the strength and weakness can be categorized as internal factors of evaluation for an organization. On the other hand, the issues of opportunities and threats are categorized as external factors and are always analyzed with regards to the happenings and influence coming from the external environment (Pride and Ferell 33). 2. In very layman terms, marketing can be explained as an activity which comprises of the process of value generation, value communication, value distribution and value delivery to the consumers. Marketing is often represented as the activity which comprises of smooth application and integration of the 4Ps of marketing like product, place, promotion and prices (Pride and Ferell 4). Matching the 4Ps of marketing with the equation of value, it can be said that product represent value generation, place represents value distribution, promotion represents value communication and price represents value delivery and capture. It is very important for a business to implement the various variables of marketing in the right time but in a new and innovative manner so as to leverage the maximum amount of competitive advantage that can be extracted for the business. The importance of marketing can be well established by providing a well known example from the beverage sector of America. During the year 2010, through aggressive and clever marketing strategies, the Diet coke of Coca Cola overtook Pepsi to occupy the second spot in the US. It is important to mention as a result of marketing, Coke was able to win back in the decade old rivalry, which is more popularly referred to as the war of the Colas (Esterl, “Diet Coke Wins Battle in Cola Wars”). Descriptive Questions 1. It is of superior importance to mention the fact that marketing is a very crucial activity in any business, since it plays the lead role in communicating the values of the company or organization’s products or services to the desired set of clients and customers. For the purpose of sustaining in the market, it is very important for a company to focus on its revenue earning strategy and thereby develop a significant competitive edge. It can be said in direct link up that for the purpose of generating a steady cash flow process, it is imperative that the organization’s products and services attain high sales volume in the market place. It can be said that for the purpose of selling a product or service, having a proper and effective STP strategy is highly important. STP which denotes segmentation, targeting and positioning helps the organizations in a market place to focus on the process of aiming the right set of customers. Talking in a more simplistic manner, it can be said that the segmentation of a particular set of population helps the companies to identify the right group of customers who have the needs to buy the particular line of products and services. The method of targeting represents the process of aiming the right set of identified customers by the firms to attain a significant growth in sales of the firm’s products and services. The picture provided below represent various kinds of segmentation strategy employed by the firms. Source: Pride and Ferrell 160 It is highly imperative to mention that in this stage, the strategic decision makers of the company tries to identify the potential buyers for the firm’s products and services, while analyzing their individual consumer behaviour as well as demographic profile and purchasing power capacity. Finally, while discussing on the factor of positioning, it can be highlighted that it represents the effort of the firms to place the product or service in the desired target market and build a compatible image which will be effective in matching the expectation gap as well as need based requirements of the targeted set of consumers. 2. Boston Consulting Group or the BCG matrix is a very important management tool that is often used in business organizations to plot the growth opportunities arising in the market along with the factor of acquisition of probable market share. The BCG matrix often helps the strategic planners of an organization to identify the position of the company’s various verticals or divisions in the market place and indentify their individual performance as well as the probable scope and opportunities of growth. There are four key components in the BCG matrix which comprises of star, cash cow, problem child and dogs. While star and cash cow are high revenue earners, the problem child and dogs are often categorized as low revenue generators. Source: Pride and Ferrell 39 a. It has to be mentioned that the company operates through five SBU’s which has varying amount of sales turnover. Also, the SBUs are located in multiple markets with different market growth rates. Hence to assess the strength of the company in the current times as well as that of the future, we need to consider the SBUs in an individual manner. SBU   A B C D E Sales in Current Yr(Million USD) 1 3.2 3.8 6.5 0.7 Market Growth Rate (In %) 15 20 7 4 4 Forecasted Sales in Next Yr (Million USD) 1.15 3.84 4.07 6.76 0.73 Hence, talking in regards to the components present in the BCG matrix, it can be said that the SBU A is the problem child because of its positioning in the high market growth rate and low market share. SBU B is the star because of high market growth rate and high market share. SBU C and SBU D are the cash cows since they belong to zones of low market growth rate but high market share. SBU E is the dog since it is low in both market share as well as market growth rate. b. Talking about the strategies that can be recommended to the company in managing its strategic business units (SBUs), it has to be said that SBU B which is the star performer. Hence it has high needs for capital investment for attaining growth in the market. It will be advisable to recommend that the capital generated from the cash cows to be invested here for consolidating market share for this SBU. BU A, since being the problem child needs more attention. Hence, for turning it into a star, cash generated by the cash cows needs to be diverted and invested here. The SBUs C and D are the cash cows for the company. Hence, it will be wise to hold them and generate vital finance which can be reinvested in SBU A and SBU B. The SBU E being the dog, it will be advisable to cease its business operations as it might become a liability for the company in the near future. 3. The world of business has undergone a significant amount of transformation in the last decade. Due to high amount of technological connectivity that has developed in various corners of the world, because of the fast penetration of the internet as well as the evolution of the various kinds of sophisticated gadgets like the i-Phones, I-pads, tablets, laptops and Smartphones, the it can be said that the process of engaging in business operations has become increasingly competitive. In the interconnected global business environment, information is the new power for the business organizations as it helps them in churning out a significant competitive advantage in the market. Hence, in order to derive the knowledge based competitive advantage, it can be said that the power of information lies to those who focus on strategic planning for the company while keeping in mind the emerging trends of the marketplace. Strategic planning is an important organizational process, which involves defining the mission and objectives of the company as well as formulating long and short term goals. This process also comprises of designing a corporate level strategy, formulation of the objectives of the organization’s marketing endeavours and the formulation of a marketing plan. While trying to frame the pillars of strategic planning, the factor of market orientation which essentially forms a bridge between the customers’ expectations and company’s value delivery has to be considered very seriously. While engaging in strategic planning, the firms need to focus on leveraging the competitive advantage by focusing their core competences. Core competencies of a firm can be based on single or multiple processes of the organization, which increasingly acts as a pillar of strength while competing in the marketplace and thereby gives the company with an upper hand in the marketplace. Source: Pride and Ferrell 30 Now, describing briefly, the marketing plan is a document that highlights the value communication efforts to be undertaken by the company. It also discusses the means and strategies to be used by the firm to implement the control the effects of the marketing plan. A marketing plan generally comprises of executive summary, analysis of the business environment, SWOT analysis, marketing objectives and strategies. Finally it also talks about the way of implementing the marketing plan as well as garnering control of it. Source: Pride and Ferrell 44 Works Cited Pride, William M. and Ferell, O.C. Marketing. 16th ed.USA: South Western Cengage Learning. 2012. Print. Esterl, Mike. Diet Coke Wins Battle in Cola Wars. 17 Mar 2011. Web. 12 Mar. 2013 Read More