Marketing Exam Preparation for Monash Diploma Essay Example

thinking processes, behaviors, and influences. By comprehending consumer behavior, we can improve our marketing mix.

The factors that influence consumer choice can be divided into two categories: internal and external. Internal influences pertain to personal and psychological factors. For instance, as children, customers are likely to purchase toys, but as young adults, they may be more inclined towards fashionable clothing. On the other hand, external influences encompass cultural and social factors. For instance, Muslims are prohibited from consuming alcoholic beverages, consequently they are unable to purchase beer brands such as Heinlein. By analyzing consumer behavior, we gain insights into customers' preferences and the various groups they belong to. This information aids in determining the target customer groups to focus on, with the assistance of STEP.

Segmentation is a beneficial tool for differentiating customer groups. Companies are urged to concentrate on specific customer groups that are likely to buy their products, thus enhancing efficiency and effectiveness. Segmentation can be determined by geographic factors (customer location, climate, population density), demographic factors (gender, age, family status, ethnicity), psychographic factors (social class, lifestyle, personality traits), and behavioral factors (customer behavior towards the product).

Companies have the option to choose one or more target markets and determine the desired positioning - the image the company wants customers to perceive of its product. Once this is decided, the marketing mix can be developed. The process begins with the product, which can take various forms such as a person, place, good, service, idea, or even an experience. Nowadays, most products consist of a combination of tangible and intangible elements. The product becomes the focal point of the marketing mix, as it is

what drives the need for price, place, and promotion. Afterward, the product is branded through the use of a name, term, sign, symbol, or design to both identify and differentiate it from competitors.

The objective is to make the prospects view the company as the sole provider of solutions to their issues. Subsequently, we consider the price and the placement of the product through marketing logistics.
Marketing logistics encompass various stages, including raw material acquisition, production, transportation, retailing, and ultimately reaching customers. This aspect is complex, regulated, and crucial, yet often overlooked.
Companies must make the choice between managing marketing logistics internally or outsourcing them. Outsourcing can cover numerous aspects such as information, promotion, contact, coordination, negotiation, physical distribution, and financing. Following this, we proceed with promotion.

The term Integrated Marketing Communication is commonly used in promotion to refer to the use of multiple communication methods with customers. Communication can be categorized as verbal, which involves spoken words, discussions, speeches, and interpersonal interaction; and nonverbal, which encompasses body language, facial expressions, and gestures. The promotion mix consists of advertising, sales promotion, public relations, and direct marketing. Advertising is typically paid for, one-way (without feedback), and clearly identifies the sponsoring company. It can serve various purposes such as informing, persuading, reminding, and reinforcing. Public relations is utilized to create a positive image of the company and can be accomplished through publicity. Sales promotion is often employed to encourage customers to make immediate purchases.

In order to effectively carry out marketing activities, various strategies can be employed by companies. These strategies include providing examples such as samples, coupons, point-of-purchase promotions, contests, games, and sponsoring concerts and sport games. Planning

and controlling are crucial aspects in this process. Planning involves the establishment of goals, both short-term and long-term, as well as specific activities to achieve these goals. Furthermore, companies need to control the overall marketing process by assessing the results and comparing them with the set goals. If any deviations are identified, corrective actions need to be taken to modify the marketing mix accordingly. An instance of this would be if the product packaging contributes to excessive weight, requiring marketing management to reevaluate the packaging plan and make necessary adjustments. Moving on to Section B - Long Answer Questions 1, it consists of listing and explaining micro/macro factors.

Micromanagement involves the internal and external factors that influence an organization's ability to meet customer needs, including the organization itself, marketing channel firms, customer markets, competitors, and publics. Other departments within the organization, such as the Board of Directors, Accounting Department, HARD, and R&D, also play a role in delivering customer value and satisfaction. If the budget for marketing is reduced by BODY, the marketing department must adapt its strategies accordingly, which could be seen as a potential threat. Intermediaries, such as resellers, wholesalers, and retailers, are external groups that assist in delivering services. If resellers increase their demand for our products, it presents an opportunity for increased sales. Customers are both potential and current buyers of our offerings.

Individuals or groups who purchase our products are considered our target audience. If our audience prefers mints over gums, this could pose a threat to gum sellers, while also presenting an opportunity for mint sellers. Our competitors are other organizations that sell similar or substitute products. For example,

if Moodiness's impetigo product faces competition from Mark's Wrigley, which has launched a new kind of gum that is more attractive to teens, there is a risk of ID gum losing its customers to Wrigley. The publics include any group that has a potential interest in or impact on our organization's ability to achieve its objectives. For instance, if a pressure group demands a reduction in the use of animals in the fashion industry, it can create a challenge for us within that specific market.

The fashion industry faces a threat from not being able to launch clothing made from animal skin. The macro environment encompasses societal forces that impact overall micromanagement, including demographics, economics, nature, genealogy, politics, and culture. Demographic factors involve the study of human populations in terms of size, density, location, age, gender, race, occupation, and other statistics. Economic factors affect consumer buying power and patterns. For instance, Australia's recession is reducing disposable income and lowering consumption, presenting a threat to businesses. Natural marketing activities encompass resources like water, forests, oil, coal, and minerals.

As resources become scarce, costs increase, posing threats for companies. Technological forces create new technologies, product and marketing opportunities, and change the way we market and communicate with customers. Political forces include laws, governments, agencies, and pressure groups that influence and restrict organizations and individuals in a society. For example, governments establish laws and regulations that limit business for the benefit of society, which can be a threat for businesses. Cultural forces comprise of institutions and other influences that affect a society's fundamental values, perceptions, and behaviors. Now, let's briefly explain the four major bases used for segmenting

a market.

Segmentation can be done using different factors. Geographic segmentation involves dividing customers based on their location, weather conditions, and population density. Examples of this include seasonal locations, desert regions, and national areas. Demographic segmentation categorizes customers based on population characteristics such as gender, age, family status, and ethnicity. This type of segmentation is commonly used in the toy industry. Cryptographic segmentation considers social class, lifestyle, and personality characteristics. It includes activities, interests, opinions, and lifestyle choices. Magazines often use this type of segmentation. Behavioral segmentation focuses on customer behavior towards a product including usage rate, timing, loyalty, and skills. Effective segmentation should be measurable to accurately collect data for measuring the number of customers.

The text emphasizes the importance of several key factors for effective marketing strategies:

a. Measurability: The market's size and purchasing power must be quantifiable. If not, assessing profitability becomes challenging.
b. Accessibility: It is crucial to be able to communicate with and deliver products or services to the target customers. For instance, using mediums like interest, TV, and radio are essential for effective communication.
c. Distribution: Targeting specific locations, such as a shop in Jakarta targeting people in Jakarta, ensures better focus and success compared to targeting a broader audience like New York.
d. Substantiality: The market should be large enough and profitable to justify investing in it.
e. Differentiability: Clearly defining the market and distinguishing it from others helps eliminate confusion and doubt regarding which part is being targeted. This is important because there is a risk that marketing efforts might affect unintended audiences.
f. For example, married and unmarried men may exhibit similar buying behavior patterns.

Actionable: having sufficient resources and the

right skills to pursue the market. There are three methods for evaluating segmentation: segment size and growth, segment structural attractiveness, and company objectives and resources. The five stages in the buyer decision-making process include the role of marketing at each stage. These stages are: problem recognition (also known as need recognition), information search which involves promotion (advertisement, website), evaluation which entails providing superior value, actual purchase which includes place and distribution ensuring easy availability of the product, and post-purchase which involves before and after sales service. The buyer's decision begins with recognizing their own needs. How do you identify a need?

When deciding when to make a purchase, one method is to recognize the disparity between our current state and desired state. Feeling bored prompts us to seek entertainment because there is a distinction between how we currently feel and how we desire to feel. This disparity serves as a signal for consumers to go out and buy something in order to alleviate their boredom. The source of this need can originate from within oneself, such as feeling shivers indicating the necessity for warmth when feeling cold. Similarly, a rumbling stomach signifies the need to eat, while a dry throat indicates the need to drink. These sensory cues are known as internal stimuli.

Another form of stimulus is external, like encountering an advertisement in a magazine for a new kind of cellophane and thinking, 'I want to buy this cellophane.' This advertisement triggers the idea that your current cellophane is no longer attractive and that you require a new one. This initial step is referred to as problem recognition, where you start sensing a

lack of something. To address this issue, you acknowledge the need for making a purchase. The subsequent phase is information search, during which buyers commence searching for specific details about the products they intend to purchase. There are four primary sources of information: commercial, personal, public, and experiential sources.

A commercial source, such as an Academy Chocolate advert, aims to sell a product. It is solely focused on persuading you to purchase the Academy chocolates. Personal resources, like family and friends, are sources close to us that do not have the intention of selling us a product. However, they possess knowledge about the product and are more trustworthy since they have a closer relationship with us compared to advertisements. Lastly, public sources are widely available and include media from TV and information from magazines.

The last source is the experiential source, which is based on personal experience and is typically used for low involvement purchases. For high involvement purchases, buyers typically spend more time gathering information about their options. However, for a low involvement purchase, buyers may utilize all of the aforementioned sources. After conducting their research, buyers will create their 'Evoked Set', which is a group of brands they are considering. They will then evaluate each brand based on factors such as quality, price, usage, time limit, etc.

In the process of making a purchase decision, individuals must determine what satisfies their importance and needs the most, as well as provides the greatest value. For instance, when buying chocolate, options like Academy, Doubleton, Hershey, and MARS may come to mind. However, only one will be chosen that adequately fulfills the craving for chocolate. Factors

such as taste are considered in this judgment, such as Academy being 'okay', Doubleton tasting like gum, Hershey being excessively sweet, and MARS not tasting like chocolate at all. The purchase decision phase refers to the actual time of buying the product and encompasses when to make the purchase, where or which shop to visit, and how to go about the buying process.

In the afternoon, you will purchase it from a nearby nonviolence store using the money provided by your mother. Post-purchase behavior is the final stage in the buyer's decision process, encompassing customers' attitudes and actions following product acquisition. It is crucial to prevent 'Cognitive Dissonance,' which occurs when customers recognize that the purchased product fails to meet their expectations or satisfy their needs. For low involvement purchases, customers can learn from this experience and refrain from buying the same product again.

The main issue lies in high involvement purchases, where customers have to tolerate something they did not want for a long time after spending money. It can be a torment for them and can lead to negative word of mouth. To prevent this problem, companies should consider offering before and after sales service, such as providing samples. This way, customers won't become angry at a product they dislike because they are not actually purchasing it; they are simply trying it out or experiencing it briefly through the samples. The four steps of market research can be applied to address the low sales of a new game controller. This involves defining the problem and research objective, as well as promoting communication between the manager and the researcher.

The manager needs to clearly

communicate their requirements and the specific information they are seeking from the researcher. This involves defining the problem and setting the research objective. There are two types of research that can be employed: exploratory research and descriptive research.

Exploratory research is conducted when there is no existing information available and serves as the initial investigation. Descriptive research follows exploratory research and involves collecting more detailed facts and data.

Additionally, causal research can be conducted to determine how changes in the marketing mix will affect outcomes. Conducting this type of analysis is challenging and can be considered the most difficult step in the research process, as the manager may require information that is difficult to obtain.

The manager and researcher need to fully comprehend the objectives at hand. They should also create a research plan that entails gathering three types of data: internal data, marketing intelligence, and marketing research. This plan must also include outlining the methods for collecting data. For marketing research, primary data will be collected through observational research, which involves observing pertinent individuals, actions, and situations. On the other hand, secondary data for marketing intelligence will be obtained from sources such as commercial and online data, government data, brochures, etc.

However, there are certain aspects such as emotions, attitudes, motivations, and personal conduct that cannot be directly observed. Single source data systems can lead to misinterpretations. These electronic monitoring systems connect consumers' exposure to telecommunication and advertising (measured through television meters) with their purchasing activities in stores (measured using store checkout scanners). Observational research can provide insights that individuals may be unwilling to disclose. Survey research involves collecting primary data by asking

people questions about their knowledge, attitudes, preferences, and buying behavior. Survey research is most effective for gathering descriptive information.

Survey research is the most commonly utilized method for gathering primary data, offering flexibility. However, it does have drawbacks such as respondents being hesitant to answer or providing inaccurate responses due to lack of willingness to allocate sufficient time for answering. Quantitative data consists of statistical information in the form of multiple choice, true/false, or yes/no questions. On the other hand, qualitative data focuses on comprehending why and how individuals respond in order to collect high-quality information.

Mixed data employs both quantitative and qualitative approaches. For instance, it involves posing a yes/no question followed by a qualitative question to obtain deeper insights. Ethnographic research specifically collects demographic data. Experimental research entails selecting subject groups, applying different treatments, controlling other factors, and comparing their responses to establish cause and effect relationships. Observations and surveys serve as common methods employed in this type of research for collecting information.

This form is most suitable for gathering casual information. Contact methods include mail questionnaires, telephone interviewing, and personal interviewing (which can be individual or group-based). One specific form of personal interviewing is focus group interviewing, where six to ten people are invited to discuss a product, service, or organization with a trained interviewer for a few hours. Online marketing search can involve Internet surveys or online focus groups.

The researcher must closely monitor fieldwork to ensure proper implementation of plans and address potential issues, such as difficulties in contacting respondents, uncooperative individuals, biased or dishonest answers, and errors or shortcuts by interviewers. After obtaining and analyzing all relevant data, the

report should be interpreted and sent back to the manager. The final report is a comprehensive document that presents research findings and provides recommendations. It serves as the basis for deciding whether to proceed with marketing the product or service or acknowledging its impracticality.

Conducting marketing research is crucial for both independent business people and companies with significant revenue. Failing to do so will result in wasting time and money without making any progress. The different stages of marketing research include product development, introduction stage, promotion strategy, and price point-of-purchase (POP). Recommendations for each stage are as follows:
1) Product Development: Conceptualizing and developing the product idea involve various investment costs, although sales do not occur.
2) Introduction Stage: The goal during this stage is to raise awareness about the product and establish a market for it.
3) Promotion Strategy: Instead of advertising during the decline stage, emphasis should be placed on sales promotion to promote the product effectively.
4) Price POP: Setting an appropriate pricing strategy is essential, while also considering distribution in conjunction with the product's point-of-purchase (POP).

The impact on the marketing mix is as follows:

• Product branding and quality level is established, and intellectual property protection such as patents and trademarks are obtained.
• Pricing may be low penetration pricing to build market share rapidly, or high skim pricing to recover development costs.
• Marketing communications seeks to build product awareness and to educate potential consumers about the product.

In the growth stage, the firm seeks to build brand preference and increase market share. Product quality is maintained and additional features and support services may be

added. Pricing is maintained as the firm enjoys increasing demand with little competition. Distribution channels are added as demand increases and customers accept the product. Promotion is aimed at a broader audience.

In the maturity stage of a product, there is a decrease in sales growth and competition from similar products. The primary goal is to protect market share and maximize profit, which can be achieved by enhancing product features to distinguish it from competitors, possibly lowering pricing due to increased competition, and implementing intensive distribution strategies with incentives to encourage preference over competing products. Promotion during this stage focuses on highlighting product differentiation.

In the decline stage, when sales of a product start to decrease, the company has several options. They can choose to maintain the product by adding new features and finding new uses, they can reduce costs and continue offering it to a loyal niche segment (known as harvesting), or they can discontinue the product. Discontinuation could involve liquidating remaining inventory or selling it to another firm willing to continue its production.

There are four characteristics of a service. Firstly, services are intangible, meaning they cannot be seen or tasted. This lack of tangibility can lead to consumer uncertainty and lack of confidence.

The extended marketing mix helps in understanding how the marketing strategies for services differ. It includes additional elements beyond the traditional four P's (product, price, promotion, place). These additional elements are people, physical evidence, and process. People refer to the individuals involved in delivering the service and their interactions with customers. Physical evidence includes tangible elements that support the service delivery, such as facilities or equipment. Finally, process refers to the procedures

and activities involved in providing the service.

The physical evidence component of the extended marketing mix plays a crucial role in helping consumers assess the value and quality of a service. This is especially important because customers often struggle to evaluate these aspects. For instance, when selecting a beauty salon, customers may consider factors like the atmosphere and decor or the qualifications and professional reputation of consultants. Unlike goods that can be manufactured and stored for later distribution, inseparable services in the extended marketing mix are created and consumed simultaneously. As a result, the service provider themselves become an integral part of the service delivery process.