Services Marketing Is Different - Assignment Example

Marketing Q1 (a) A market comprises an entity involved in buying, selling and goods and services distribution to reach the target persons or groups. On the requirement of a market, it demands the presence of many buyers to help in determining prices based on supply and demand. A market also demands the presence of many sellers. Markets should have homogenous goods with no competing alternatives so that the product being sold remains the same in quality, size and other features. It is convenient for sellers and their buyers to have adequate information about their market to remove chances of rumors and misjudgments about the goods and services being sold. The market should have minimal bottlenecks of entry and exit. In this locality, many consumers like college students prefer take away French fries and burgers, Muslims cherish Masala chicken while long distance truck drivers like Guinness. These market is untapped and a considerable potential to the company to sell in large quantities. The company should create a distribution system to provide these products to the target consumers at favorable pricing at the opportune time. These groups so far live on the substitutes which are unreliable. Q2.b) Market segmentation refers to classifying consumers and analyzing their behavior according to their attitudes, lifestyle, needs, age, gender and incomes. Segmentation helps marketers to maximize their return on investment through a marketing activity. It is easier to understand market composition and also assist in communicating to the target segments more effectively. Psychographic segmentation classifies buyers according to their socioeconomic status, personality features and lifestyle. In socio-economic, it considers variables like occupation, and educational level of household heads, income and social standing. It strongly affects habits, activities and preferences. Companies thus design products to meet needs of particular socio-economic classes. Buyers express lifestyle in the goods like frozen food for singles and healthy bacteria cultured food for young consumers. Personalities in advertising have influenced many products from cosmetics, insurance to alcoholic beverages. In behavioral segmentation, knowledge and attitude governs use and response to the product. These segment places product use during the day like milk over breakfast. Benefits of the product give the user economic, cosmetic, and protective and taste like the case of toothpaste. In addition, the market comprises users at every point of use like past, regular and potential users. Other factors in behavioral segmentation are usage rate, loyalty status, buyer reading stage and attitude. b) The basic information to segment markets is the geographic unit like regions, cities, neighborhoods. The other is demographics which includes are sex, family size, education, and age. Primary research is beneficial in gathering information regarding the buyers and their attributes. The mode of data collection will depend on the type of market targeted. For instance, a questionnaire will be necessary if demographic information like education, gender, age, income levels and occupation is to be attained. Research helps to identify the most meaningful bases which markets can be analyzed so as to identify the segments. The information can be analyzed in tables and graphs using descriptive studies. In terms of measurability, left-handed people in Australia are not documented by government and private data companies. Accessibility of certain groups to products like single women requires correct placement. Substantiality has increased mass customization and lowered costs of say downloading a favorite CD. Actionability draws on effective programs like a small airline with lean staff cannot mange separate marketing programs. Tourism Australia has produced information regarding the Chinese segment size, heart of a segment, profile, approach to long haul travel, Australia as destination, source of inspiration, reaching them in the media, travel profile and planning sources and timeline. Q3 a) Evaluation and selection of market segment considers the growth and size of the segment, structural attractiveness and the company objectives and resources. The company should collect and collate data relating size growth, structure and align with the goals of the organization. Use of internet to gather information has created stiff competition to Australian bookstore. Dymocks will experience reduced sales and profits owing to many buyers preferring the convenience of the internet. However, some buyers still prefer reading books and will remain loyal customers to the bookstore. Australian bureau of statistics (ABS) provides information on cafes, accommodation, casinos and licensed clubs in Australia. In addition, Accommodation Association of Australia (AAA) supports operators, business interests of backpackers, hotels, resorts and motels. Restaurant and catering Australia (R&CA) provides information on worker skills and performances of accommodation businesses in Australia. The information provided by the organization helps the Australian hotel owner to know the current market trends in employment, skills available in the market, customer behavioral dynamics and efforts of competitors including the quality of facilities they offer. This enables the hotel owner to adjust pricing or improve the quality of services offered in each segment. Q3 b) The formula 1 main segments provides for customers with families. It is informed by the demographics like age, family and geographic such as access from commercial areas and vital transport routes. Families can now have a room with three beds to accommodate every family member comfortably. It also considers psychographic features like lifestyle by providing automated flush and steamy toilets. Also a customer can take nutritious breakfast, and sleep on queen-size bed with favorable rates at all locations in Australia. The strategic marketing options for formula 1 hotels chain is to sell and promote the existing services to its present clientele. It can also develop new line of service to sell to the existing customer groups like families, businessmen, tourists and government officials. They can also expand the existing services into new market segments or create new services for the new market segments. In the case of formula 1, the hotel chain already has large client base. It can expand the facility to accommodate more families and dwell on modification of the existing facilities which help a great deal to retain the existing customers. The hotels can also embark on providing new services to new market segments which is less risky compared to providing new services to new market segments. Q4 a) Marketers require information on consumer behavior so as to create the right proposition, offer the correct service or product and satisfy the different customer segments. Customers come under different classification requiring that the product or service given has met the innate desires and will continue to prefer the product other than the one provide by the competitor. Marketers have an obligation to use the demographic, geographic, psychographic and behavioral data to map the locations of all varieties of customers. Consumer profile is documentations of all the attributes and characteristics of customers falling under different segments. The profile helps marketers to establish their proportion in terms of numbers, education levels, lifestyles, occupation and use of technology among others. When their size has been determined, supply will be judged to increase, stay or increase. Generation Y consumers are mainly teenagers and those in early twenties. They are young, trendy and explorative and would like to express fashion in a new way. They always feel like trying new things and therefore demand a flexible program form parents who are conservative. Generation Y would try on flashy clothes, shoes, hairstyle and takeaway snacks and cookies. Q4 b) in the extreme adventurer segment, it size is 2.3million long haul travelers being 18% of the long haul market. The heart of this segment involves a strong desire to engage in extreme sports and fulfilled events in any part of the world. There profile includes singles, university educated, and flexible, middle income earners, owns a camera and videos, have international credit cards and aged 18 -40 years. Their approach to long haul travel is to visit exciting destinations; they are determined to venture into new places and understand the geography of places well. They view Australia with immense enthusiasm like rock cliffs, underwater diving and horse riding to the Blue Mountains. They are inspired by nature and always desire to try new approaches of having fun and having fabulous time to exercise, conquer and learn. They can be reached through the Guangzhou daily, CCTV, Beijing satellite and SH TV Great sports. They spend most of their time watching extreme videos and TV programs. Their planning timeline includes traveler planning of 12 weeks, flight booking 3 weeks and accommodation booking of 2 weeks to departure. They use similar sources and self-challengers. They travel alone in groups of 15 and live in moderate hotels. They involve in extreme winter sports, water sports and cliff climbing. Long haul destinations are Africa, US, Switzerland, France and Germany. Q5 a) Market positioning is the influence of the marketers on the image of the brand by drawing on the perception of the consumers as opposed to those of competitors. Positioning helps the marketers to differentiate the products and put value to the brand by creating a notion in the mind of the user. Since consumers cannot distinguish information on products, it is hard to make a decision on what to buy. Marketers can position the products in the minds of the undecided consumers to buy. British Airways positions its services on performances and routing. They also position against competitors like Royal Dutch airlines and Scandinavian. In addition, they position to meet certain classes of users like first class, economy and business classes. Companies like McDonalds and BHP Billiton usually select the right competitive advantage by specializing in certain outputs only hence service differentiation. They also seek opinions from their customers on the value differences of their products by seeking to establish the brand context, prospective customers and existing clientele. They easily establish these personal differentiation strategies through explanations on perceived differences and similarities. Q5 b) The positioning implementation plan should include category of product membership, point of difference with other category members. Positioning statement gives a brief summary of the company position or brand positions. The Coles Group gave ALDI leverage by not fighting from within but instead withdrew all the BI-Lo stores. In effect they were positioning away from the new competitor ALDI with greater opportunity to sell fewer brands at discounted rates. It will be easier for ALDI to extend its market share after the withdrawal of Coles Group. ALDI has positioned itself through image and brand by offering discounts and managing fewer brands at lower prices. Lower end grocery buyers are used to open market grocery sellers normally viewed as cheaper and experienced in handling food items. The private label brands will fall to the middle income segment and does not apply to the entire classes of income earners. Private labels are associated with value addition and thus higher pricing and storage. ALDI caters for the needs of price sensitive segment. The positioning statement of ALDI can be: To deliver lower priced FMCG to price sensitive customers through accessible stores in time using the latest means of distribution. References Bauer, R.A. (2007). Consumer behavior as risk taking. In Cox, D. (ed.) Risk taking and information handling. Boston: Division of Research, Graduate School of Business Administration, Harvard University. Berry, L.L. (2001) Services marketing is different. In Enis, B.M. and K.K. Cox (eds) Marketing classics. Boston, Mass.: Allyn and Bacon. Berry, L.L. & Parasuraman, A. (2004) Marketing services. 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