Marketing Planning and Principles - Assignment Example

Marketing Planning and Principles AC 2.2 Segmentation refers to the act of dividing the market of a product into various sub-markets that consist of consumers with similar characteristics. The market of a product may be segmented into sections that include geographical location, behaviour and social class. Geographical location segmentation involves dividing the markets for a product according to the physical locations of customers (Kotler, 2000). For example, Anki Company may first target consumers who live in the United Kingdom or European Union depending on the market the organization chooses to serve first. These geographical locations consist of consumers who have similar characteristics and who may be interested in a gaming product that suits their characteristics. Companies may also segment their consumer markets based on social classes. This is because consumers are divided into various social classes with some being in the elite, others middle, and the rest are in low class (Daniel, 2012). The organization may design products for these classes and design and price them differently so that they may fit the needs of each social class. This may enable consumers to get satisfied because they receive the value for their money. An organization may also segment the market for its products depending on behaviour of consumers. For example, there are individuals who have a tendency to conduct online shopping when they want to buy products; others shop offline. This form of segmentation may enable the organization to serve the needs of consumers who do both online and offline shopping (Sheehan, 2011). AC 2.3 Organizations may use various strategies to target consumers in various market segments. Differentiated targeting strategy is the one where an organization produces different product designs for different markets (Winner, & Dhar, 2014). This strategy recognizes the needs of different consumers and provides them with the products that they deserve. Undifferentiated target marketing helps organizations to charge higher prices for products and thus earn high sales and profits. Concentrated target marketing strategy, on the other hand, is the one where an organization focuses only on one market segment (McDonald, 2008). For example, a company may pay attention to the United Kingdom geographical region and serve the needs of consumers in this location only; while ignoring others. This technique enables an organization to understand one market segment thoroughly and take care of all its needs. This leads to high sales and profits from the focus market (Kotler, & Armstrong, 1991). Concentrated targeting is efficient for small organizations that face huge competition from developed companies in the market. The simplest targeting strategy is the undifferentiated technique that involves producing a standard product for markets in all segments (Palmer, 2000). This strategy ignores the special characteristics of consumers in various market segments, for example, behaviour and social class. Undifferentiated target marketing also saves the cost of production and advertising for an organization (Kurtz, & Boone, 2012). Anki Drive may adopt this strategy in the beginning because it is dealing with a unique robotic game that faces little competition. The minimal competition means that the company will be able to penetrate in the market and make huge sales and profits. AC 2.4 The behaviour of consumers may influence the marketing activities of an organization. Consumers may change their behaviour internally or externally depending on the cause of change (Grewal, & Levy, 2010). For example, consumers may get used to using social media to identify products in the market. Consumers do this by liking the pages of various manufacturers and following them on Instagram and twitter. This behaviour of consumers may influence organizations to market their products on social media platforms. When organizations introduce new products or make changes to existing ones, they have to inform their social media followers first to keep them updated. Companies then gather feedback from consumers on these platforms and analyze it to make use of relevant comments (Hooley, Saunders, & Piercy, 2004). Another buyer behaviour that may affect organizations marketing campaigns and strategies would be the action of buying products only when they know how they work practically. This behaviour would mean that organizations have to conduct marketing campaigns that demonstrate how to use products to realize their full benefits (Chaston, 1999). Marketing strategies that would be essential in this case would be videos on social media, exhibitions, and road shows that are coupled with demonstrations. Consumers may also tend to purchase more products when they receive discounts and promotions from sellers (Blythe, 2009). This would mean that organizations have to device techniques of encouraging customers to buy by giving them price discounts when they buy a certain minimum quantity of products. This motivates consumers to buy goods in bulk and it motivates them to become loyal to the company. AC 2.5 Market position is a technique of creating mental pictures of a company’s products in the minds of consumers: when they hear about the organization or see anything related to the firm (Sengupta, 2005). This means that positioning is a critical element in an organization that aims at capturing the attention of numerous consumers in the world. An organization may use images or statements to position its brand in the minds of consumers. Anki Company may position Anki Drive in customer minds by using images of the cars in the game and using statements that thrill consumers. For example, the organization may create a video of one of its Formula One car model and use it to advertise the game in all its marketing campaigns. The company may then couple the video with statements that inform consumers about the game and the benefits of playing it. For example, the organization would use this statement, “Overcome your boredom by enjoying the outstanding power of Formula One in your living room.” This statement confirms that the car in the video is a formula one and that it has unique powers. This statement also informs consumers that by playing Anki Drive, they may be able to overcome boredom while at their homes. Therefore, when consumers hear or see an advertisement about Anki Drive, the picture that comes into their minds is a formula one car game that conquers boredom with its outstanding features. AC 3.1 Organizations develop products using various designs and techniques to help them earn high competitive advantage in the market. Competitive advantage is the ability of an organization to differentiate its products from those of other producers (McDonald, & Meldrum, 2013). The uniqueness of products then enables companies to sell high quantities and earn high sales from products. Anki Company obtains its competitive advantage by producing a unique product that is not easily imitable known as Anki Drive. Anki Drive is a robotic game that uses artificial intelligence to perform activities such as racing. The game has sensors that help it to receive, analyze, and store data like a human being. This means that the product is unique and competitors may not easily produce a similar product; because it requires highly sophisticated technology and skills to create. Anki Drive also achieves high competitive advantage by providing consumers with value for their money, thus creating brand equity for the product (Beamish, 2004). The racing experience that the game offers to consumers makes them to feel that they enjoy the full value of their money they pay for the game. This motivates consumers to use the product often and become loyal to the organization’s product. The product also gains high competitive advantage from its ability to be used by individuals of all ages from five to at least forty years (Jain, 2000). This is unlike other games such as video games and mobile application games that are mostly suitable for children and the youths. AC 3.2 Organizations choose distribution methods that favour customers in terms of availability of goods. The chosen distribution channel has to be convenient to enable customers to get goods at the time and place that they need them. Management also chooses distribution channels that do not increase the price of products beyond the expectations of customers. Firms may distribute goods through physical or online channels. Physical distribution channels are the ones where customers visit and choose products from shelves (Clow, & Baack, 2012). Companies have to transport products to the physical distribution locations to ensure that customers do not get disappointed because of shortage. Physical distribution channels are a bit costly because they involve high transportation costs and inventory storage. However, they are convenient for basic goods such as toiletries and other products that do not occupy large spaces and that move fast (Faganel, 2011). Companies may also use online distribution channels to provide goods to consumers. For example, Anki Drive that deals with digital products has to use this channel because it is the only one that may avail products to consumers. Online distribution is cheap and easy because consumers only have to search for the product on the internet and download it to their phones (Czinkota, & Kotabe, 2001). Organizations that sell physical products may also use online distribution channel when they want to reduce the cost of transportation and storage. In this case, consumers purchase goods online and provide their addresses then the seller posts the goods to the location of the consumer from the warehouse that is nearest to the location of the customer. This saves time and cost for consumers (Winner, & Dhar, 2014). AC 3.3 Organizations set prices that help them to recover the cost of production and earn realistic profit that helps the company to develop (Marshall, & Johnstone, 2010). The prices have to cover the cost of raw materials, transportation of the inputs, processing, and labour. There are two pricing techniques that organizations may use to set prices when they are starting to sell a new product in the market; they include penetration pricing and skimming pricing. Penetration pricing is the strategy of charging the lowest price of a product in the market (Beamish, 2006). An organization takes into account the prices set by competitors who sell similar products and then lowers its price below that of all competitors. This method attracts consumers to purchase the cheap product because people always prefer to purchase products for the lowest cost. This method enables companies to achieve the objective of acquiring a large market share. Price skimming, on the other hand, is the technique of charging the highest price of a product in the market (Brassington, & Pettitt, 2003). Firms use this technique to meet their single most critical objective of maximizing profits. Companies lower the price of products with time so that they may attract new consumers to buy the product. The strategy of price skimming is the most effective for Anki Drive because the organization produces a high end gaming technology. Setting a high price for the game will persuade consumers that the product is of the highest quality in the market; thus, consumers will purchase the product (Rao, 2006). AC 3.4 Companies aim at achieving the marketing objective of reaching large numbers of consumers, repeating the message, and maintaining consistency of information using various promotional strategies (Thomas, 2007). Organizations aim at achieving these aims using promotional strategies such as advertising, sales promotion, and public relations. Advertising involves creating messages about the organization’s products and paying the media such as radio and television to pass the messages to consumers. Organizations may also use social media such as Face book to advertise their products at a lower cost than any other media. Advertising on both social media and other mediums enable companies to reach large numbers of consumers and to repeat the message numerous times (Redactive Publishing, 2011). Advertising on social media would be an effective technique because it mostly targets consumers who use social media and it is cheap and ensures consistency of information. Sales promotion also helps companies to attract numerous consumers and communicate about the benefits of products. Sales promotion involves giving consumers incentives such as discounts and coupons that help them to save (Kerin, Hartley, & Rudelius, 2011). Organizations may use this strategy for limited periods to ensure that it does incur higher costs than earnings. Anki Drive may also use this technique to promote its gaming product; this will help it to increase market share. Public relation is a strategy of promoting products of a company indirectly. Organizations use this technique by associating itself with charity events and renowned projects that may build a positive image of the organization in the minds of consumers (Chaston, 1999). This technique increases brand equity of a company’s product. AC 3.5 The additional elements of the extended marketing mix include people, physical layout, and processes (Blythe, 2009). People are the individuals who provide a service to consumers, for example, sales personnel who listen to listen to what consumers say and give them the goods they need. People are critical in marketing because their customer service skills may attract or chase customers from the organization (Beamish, 2004). Anki Drive should ensure that all its staff members are equipped with good communication and customer service skills so that they may serve customers in the best way possible. Physical layout refers to the arrangement of an organization’s retail store. Consumers expect sellers to arrange their stores in proper ways that enable them to move around stores and find the products they need conveniently (Winer, & Dhar, 2014). The failure to present an organized physical layout may cause consumers to boycott a company’s products and instead consumer substitute goods. Physical layout is not a very critical factor for Anki Drive because the company’s product is digital meaning consumers may only purchase it online. However, the organization should ensure that the interface of its website and games is easy to allow consumers to find the product and use it easily. Processes, on the other hand, are the activities that take place in an organization in relation to providing goods to consumers (Jain, 2000). For example, needs assessment and solving of customer complaints are critical processes in firms. Anki Drive should define all its processes and assign them to various people who may perform them efficiently. This avoids confusion and it increases customer satisfaction. AC 4.1 Anki Drive may sell its products to two market segments that include social media users and the elite class in the society. When selling the product to the elite members, the organization should design the product with unique and numerous features that increase the experience of consumers. The organization may then charge a high price for the product and promote it through sales promotion in high end markets. Sales promotion may be the most useful technique to promote the product because it involves direct contact with the high class members of the society (Hooley, Saunders, & Piercy, 2004). When selling the product to social media users, Anki Drive should ensure that its product is available in online platforms such as Google store and Apple. The product should also be cheap and affordable to social media users because they are mostly youths who may not afford highly priced products (Faganel, 2011). Anki then has to ensure that it promotes the products using social media platforms such as blogs, Face book, and Twitter. This means that the marketing techniques have to be digital and be concentrated online where consumers find information. The organization may also add features that attract the youth to the product, for example, adding Formula One vehicles that are common in the real world. AC 4.2 Business to consumer is the technique of selling products from an organization to a consumer, for example, retail stores conduct B2C because their customers are the direct users of products (Zimmerman, & Blythe, 2013). Business to business, on the other hand, is a technique where organizations sell products to other organizations. For example, producers may sell their products to wholesalers, retailers, or distributors who in turn sell products to other businesses or consumers. This means that B2B does not in any way involve selling goods to consumers. Marketing products to businesses differs from marketing them to consumer in various ways. One of the ways in which B2B and B2C marketing differ is the fact that B2B marketing involves providing information about the logic of the product instead of its benefits (Hutt, & Speh, 2013). This is because organizations that purchase products from others prefer goods that save their time and that are logical for their business models. Sellers, therefore, have to provide information about the benefits of selling their products rather than those of competitors. B2B marketing also differs from B2C in that it involves high costs of advertising and promotion (Kolah, 2013). B2B is costly because organizations have to conduct conferences and exhibitions that educate businesses on how to sell a firm’s products. During the conferences and exhibitions, an organization carries out demonstrations of the processes involved in purchasing its goods through presentations. These processes that take place in B2B make it expensive and different from B2C marketing, which only involves informing consumers about the price and benefits of products. AC 4.3 Domestic marketing is the promotion of a product within the borders of one state while international marketing involves promoting goods across various boundaries (Yi, 2012). International marketing may involve more than one country or all countries of the world. International marketing differs from domestic marketing in various ways that include simplicity, costs, and consumers. Domestic marketing is simple and cheap because it involves selling products to close locations (Novcic, & Segota, 2014). An organization may reach all its consumers through road shows and local media such as radio and television. International marketing, on the other hand, is complex and expensive. This marketing involves more parties than domestic marketing because an organization has to contact all its promotional departments in various countries (Yi, 2012). Communication with international departments is expensive, thus it makes international marketing to be expensive. Domestic marketing deals with consumers who are in one country and whose tastes and preferences are similar and known to an organization. International marketing, on the other hand, deals with numerous consumers who have diverse tastes and preferences (Clow, & Baack, 2012). Organizations may not be able to identify and take care of all the preferences of international consumers because this would involve a lot of differentiation that is costly. Domestic marketing also involves using uniform marketing techniques and policies while international marketing involves a wide range of policies and strategies. International marketing requires variety of policies and strategies to enable organizations to reach all their targeted consumers (Varey, & Lewis, 2002). The use of various policies in global marketing contributes to making it to be expensive. References Academy of Marketing, 2011. “Academy of Marketing Conference 2011: Marketing fields forever.” Journal of Marketing Management, 27, pp. 13-14. Beamish, K., 2004. Marketing planning. Amsterdam: Elsevier. Beamish, K., 2006. Marketing planning. Oxford: Elsevier Butterworth-Heinemann. Blythe, J., 2009. Key concepts in marketing. Los Angeles: SAGE. Brassington, F., & Pettitt, S., 2003. Principles of marketing. 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S., & Blythe, J., 2013. Business to business marketing management: A global perspective. New York: Routledge. Read More