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MARKETING
The importance of and growth of
MARKETING
The Growth of Marketing
How did
marketing
evolve?
Individual Trading
Increasing
Technology
Higher Production
Rates
Surplus Goods
The Revolution!
The Industrial Revolution was a time of dramatic change, from
hand tools and handmade items, to products which were mass
produced by machines. Workers became more productive, and
since more items were manufactured, prices dropped, making
exclusive and hard to make items available to the poor and not
only the rich and elite. Life generally improved, but the industrial
revolution also proved harmful. Pollution increased, working
conditions were harmful, and capitalists employed women and
young children, making them work long and hard hours. The
industrial revolution was a time for change. For the better, or for
the worse.
The rise in the importance of
Marketing….
• ECONOMIC GROWTH – more disposable income
since WW2 – increase in demand for products and
services
• FASHION – considerable and regular changes in
fashion – sportswear
• TECHNOLOGY –new products are being developed all
the time
• COMPETITION – increase in the number of firms
producing goods and services
MARKETING DEFINED:Give the
consumer
what they
want
How does it all work?
1979 – UK market for superbikes was growing
1983 – sales fell by 75%
• Socially – fashions changed
• Politically – laws changed – bike tests
• Technically – harder to work on a bike by
yourself
• Economically – bikes were becoming more
expensive
MARKETING OF SUPERBIKES
The importance of marketing
• Using an appropriate marketing strategy
means that firms should
•
•
•
•
•
Provide a product or service that people want to buy
Meet its aims and objectives
Make a profit
Keep customers happy
Make a good use of resources
2 main approaches to marketing
Market
orientated
Product
orientated
PRODUCT ORIENTATION MARKET ORIENTATION
• More common in the
past
• Business focuses on the
product
• Increased competition
means likelihood of
success is reduced
• Technical organisations
tend to concentrate on
the product
• Led by the market – tries
to analyse the needs of
the consumer
• Responds quickly to
changes in the market
• Strong position to meet
the challenge of new
competition
• Any business with a
large product range
Solution:Product or Market?
Why was it successful
1.
2.
1.
3.
4.
5.
6.
Initially product orientated
No particular use for the
adhesive
Little relation to the market
No demand from the
consumer
Once a use was discovered
became market
Free samples to develop
needs of consumer
2.
3.
4.
5.
6.
Met the needs of the
consumer
Technological breakthrough
(USP)
No competition
Education of consumers
Notes became fashionable
and irreplaceable
Developed brand loyalty
• POST IT NOTES
• It is possible to develop from product orientated
business to a market or have elements of the business
that are one or other of these.
• Post-its are now very market orientated – they have a
large product range:
What makes a firm choose product
or market orientation?
• The Product
• Policy
• Management
• Competition
firms operating in new areas will
be product
if safety and quality are the main
objectives the firm will be
product
background of management will
determine choice
a firm in a competitive market is likely
to be market
MARKET RESEARCH
• The collection, collation and analysis of
data relating to the marketing and
consumption of goods and services
• Used to help firms keep ahead of changes in the
market – a firm that has not carried out market
research for a product will have less chance of
success.
WHAT CAN A COMPANY RESEARCH?
TYPES OF RESEARCH
• DESK RESEARCH
• Secondary Data
• Information already
exists
• Can be internal or
external
Eg:-
• FIELD RESEARCH
• Primary Data
• Information is first hand
and must be collected
• Can be internal or
external
STAGES OF MARKET RESEARCH
Decide on
purpose
Present findings
and conclusions
in report format
Choose
appropriate
method
Gather and
analyse data
Decide on size
and composition
of sample
Carry out
research
PROBLEMS WITH MARKET
RESEARCH
• Market research is not 100% dependable –
well researched product do fail. Sinclair C5
and the Delorean are examples of this
• 90% of new products fail
• Average launch cost = £1m
Why is MR unreliable
Sampling
and
bias
Human
Behaviour
Items that have
been researched
have a better
chance of
success
PRIMARY RESEARCH
• Gathering information directly from people within your
target market – using
• Questionnaires
• Interviews – personal and telephone
• Postal surveys
• Observations
• Technology - EPOS and video
• Focus groups
• Consumer panels
THE QUESTIONNAIRE
•
•
•
•
•
When to use a questionnaire?
What can questionnaires measure?
What kind of questions do we ask?
Who asks the questions?
Why are these points so important?
Writing a Questionnaire
• Market research using questionnaires is
expensive and its results may influence
major decisions such as whether to launch
a new product. Mistakes can be very
costly.
• What are the key features of writing a
good questionnaire?
1. Clearly defined research objectives
2. Ensure the questions are not leading
3. Ensure that the meaning of each question is
clear, perhaps use a pilot or test run
4. Use mainly closed questions – ones with a
limited number of pre-set answers
5. Include a few opens questions to allow more
depth of understanding
6. Make sure you ask for full demographic details
eg sex, age, occupation and buying habits.
Other methods of research…
Consumer Panel
Observation
Hall Tests
Dustbin Audits
Test Marketing
MARKET SEGMENTATION
SOCIAL CLASS
• For the 2001 population census, the Registrar
General divided social classes into 8 area based
on employment status and conditions – this is a
change from the previous class system which
was graded A – E
• Social classifications are very useful when
aiming a product at a particular segment of the
market
• CLASS 1 – Higher Managerial and professional
occupations – corporate manager (A)
• CLASS 2 – Lower Managerial and professional
occupations – journalist, nurse (B)
• CLASS 3 – Intermediate occupations – secretary,
driving instructor (C1)
• CLASS 4 – Small employers and own account
workers – publican, taxi driver (C1)
• CLASS 5 – Lower supervisory, craft related
occupations – plumber, butcher, train driver (C2)
• CLASS 6 – Semi-routine occupations – shop
assistant, traffic warden (D)
• CLASS 7 – Routine occupations- waiter, road
sweeper (D)
• CLASS 8 – Never worked – long term
unemployed (E)
Products will be aimed at certain classes
specifically. Most firms are interested in segments
1-4 as they tend to have more disposable income.
JACQUIE ROSS:
Strat – random within groups
Quota – targets to meet
Cluster – population grps
Multi – one sample from another