Download MAY 2010 FI NAL - Institute of Bankers in Malawi

ANSWERS AND MARKING SCRIPT
QUESTION 1
Cost-related term
Total Cost
Average Cost
Fixed Cost
Marginal Cost
Variable Cost
Scale Economies
Contribution
Breakeven analysis
Explanation
The sum of all fixed and variable costs multiplied by the quantity
produced
Total cost divided by number of units produced
Cost that do not vary with the number of units produced
The addition to total cost of producing one additional unit of output
Costs that vary directly according to the number of units produced
The potential reduction in average costs as a result of increasing
output/ sales
Selling price minus variable costs
Is a level of output at any given price where total revenue is exactly
equal to the total costs of production and marketing
Scheme/ Script:

Three [3] marks for each correct answer.
(Total 15 Marks)
QUESTION 2
The 4Ps Approach
Product
The 4Cs
Customer Solutions
Price
Customer Cost
Value
Place
Convenience
Access
Promotion
Communication
Information
Shift in emphasis
Products must provide
answers/value to felt or
actual
customer
problems/needs
Price be sensitive to a
customers limited budgets,
discretionary incomes and
life cost of the product
Place must support speed
[immediacy] with which a
customer can access her
solution
to
a
felt
problem/need.
Customer must know who
to ask if she has difficulties
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with an organization’s
“solution”
[two-way
communication] to her
problem before, during
and after purchase.
Scheme/ Script:
Three [3] marks for knowing/listing the 4Ps
Five [8] marks for knowing/ listing the 4Cs
Four [4] marks for providing the rational for the shift in marketing emphasis
(Total 15 Marks)
QUESTION 3
a]
Marketing Research
....is a set of techniques and principles for systematically collecting, recording,
analyzing and interpreting data that aid decision-makers who are involved with
the marketing of goods, services and ideas.
b]
Market Research
….focuses research on is a narrower research method considering only facets
of a particular market under investigation.
c]
ADVANTAGES OF CONTINUOUS MARKETING RESEARCH
i.]
Improves a marketer’s ability to make decisions
ii.]
Helps marketers to constantly monitor the changing values and
behavior of customers
iii.]
Identifies competitors’ development and shift in strategies
iv.]
Assist in continuously evaluating current effectiveness of an
organization’s marketing mix strategies and tactics.
v.]
Enables environmental scanning as part of an organization’s strategic
planning process.
Scheme/ Script:
Three [3] marks for definition of Marketing Research
Two [2] marks for definition of market research
Ten [10] marks [two for each correct response] for section [c]
(Total 15 Marks)
QUESTION 4
(a)
Brand are the attributes in the form of name, sign, decision etc of a product
that customers identify and this strongly influence the decision by customer to
buy that product.
(3 marks)
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(b)
(c)
Branding Strategy
There are four main categories of branding strategy:
(i)
Company brand
Is the parent brand name featuring prominally on all products e.g.
National Bank.
(2 marks)
(ii)
Umbrella brand
Involves a company brand combined with an individual brand and the
company brand is used to legitimatize the individual brand e.g National
Bank.
(iii)
Range brand
Is a range of product under different brands.
(iv)
Individual name
Each product may have its own unique name.
Benefits of branding:
To Customer
Makes it easy to choose between competing products
Helps customers cope with information overload.
Supports customer aspirations to self image.
Confers customer membership to a reference group.
To Markets
Adds value to a product
Create an impression in customers mind leading to increased
reproduction.
Differentiates competing products
Encourages a full strategy
Easy for other products to piffy back or exploit brand image.
To Stakeholders
An intangible asset
High profits
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SECTION B
Question 5
1
Idea generation
 Good ideas drawn from both internal and external sources in order to
develop new products
2
Idea Screening
 From a list of new ideas a few are evaluated to determine which ones
warrants further study.
3
Concept Development and Testing
 Further study should yield concrete proposals that management looks at in
terms of:
i.]
Product features
ii.]
Demand estimates, competition and profitability tests
iii.]
Development of a program to develop the product
iv.]
Assign responsibilities [to champions] for product feasibility
studies
4
Marketing Strategy Development
 Define the manner the product will be marketed.
5
Business Analysis
 Determine if the proposed product will fit in with the business plans, financial
costs etc.
6
Product Development
 The idea on paper is converted into a physical product for pilot testing,
laboratory evaluations to determine compatibility with existing marketing
ability, production ability and adequate demand.
7
Test Marketing [market test]
 In use and commercial experimentation in limited geographical areas to
ascertain the feasibility of a full scale marketing program
8
Commercialization
 Full scale product and marketing programs are planned and the product is
launched
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Scheme/ Script:
Two point five [2.5] marks for each correct answer
[Total 20 Marks]
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QUESTION 6
‘Physical evidence’ or ‘Physicality’
….is the element of marketing that a client or customer see or feel when [s]he
purchases an actual product or service. There are two major types of evidence
i.]
Essential evidence:
 Cannot be possessed by customers but is used to obtain a core service
element.
ii.]
Peripheral evidence:
 This evidence that the customer possesses alongside the purchase of
goods/ services and used to confirm the service received.
In banking physicality includes:
1
Aisles, Sections and Queues

The way these are arranged must ensure they maximize the
opportunity to ‘see’ and thus access/ purchase a banking service/
product.

Problems of crowding should be dealt with through ‘express service’
counters and additional tellers during ‘peak’ times.
2
Ease of access

Ease of access and good display—reflecting the bank services—
encourage customers to get involved.
3
Relationship between products

Customers expect to find related bank services close at hand and
close to each other.
4
Colors

Color has a fashion and image connotation thus must be carefully
chosen.
5
Lighting

Lights be must be good for clear vision and highlighting of colors.
6
Seating

Important in encouraging customers to feel comfortable while they
wait to be served.
7
Background music

Care should be taken to control volume levels as well as choosing
the right type of music.
8
Signage and corporate identity
A Draft qualification exam for the Institute of Bankers in Malawi
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
People hate asking around when they can read and if they have to
ask staff must wear uniforms with corporate identities.
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9
Security

Essential in providing customer confidence but not intrusive to deter
people.
Scheme/ Script:

Three [4] marks for definition of ‘physical evidence, physicality

Two [2] marks each for the two types of physical evidence

Three [3] marks each for any four areas of physicality applied to a banking
environment
[Total 20 Marks]
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QUESTION 7
1
Gatekeepers
 These access and control the flow of information about products or
services to others. E.g. a teller who sees a bill-counter in a catalogue.
2
Initiators/ Indicators
 These first draw attention to a particular product/ service or suggest ideas
of buying it—influenced by a form of trigger [event or information]. A team
leader who suggests a certain type of counter to simplify tellers’ work on
the counters.
3
Influencers
 These stimulate, inform or persuade others to purchase a product or
service. A floor manager recommends the counter to management
4
Deciders
 These are the people who make the decisions to buy a product.
Management authorizes purchase a model for testing in the bank room.
5
Buyers
 These are the people who implement purchase decision by ordering or
purchasing the product/ service. The Purchasing Manager orders the
model and ensures it is delivered.
6
Financiers
 These set the budget and authorize funds for the purchase. Bank
accountants authorizes—after successful pilot test—to procurement of bill
counters.
7
Users
 These people use, consume or benefit from the product or service. Bill
counters are placed at the tellers’ counters and tellers and customers
enjoy error free banking.
Scheme/ Script:

Two [2] marks for each numbered item

Six [6] marks for bank-related examples
[Total 20 Marks]
A Draft qualification exam for the Institute of Bankers in Malawi
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QUESTION 8
1 Vertical Marketing system
 This is a distribution system with a core center organizing marketing
throughout the channel
2 Corporate marketing systems
 This is a distribution system wherein stages in production and distribution
are owned by a single corporation allowing integration along a distribution
chain
3 Contractual Marketing systems
 This is a distribution system involves agreement over aspects of
distribution marketing e.g. franchising.
4 Administered Marketing systems
 This is a distribution system wherein a plan is drawn up between channel
members to help reduce conflict.
5 Just-in-Time [JIT]
 This is a competitive distribution/ inventory control tool/system delivering
inputs to production points at a rate and time they are needed.
Scheme/ Script:

Four [4] marks for each numbered item
[Total 20 Marks]
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