Download 10.2 HSC topic: Marketing -> Total system of

10.2
HSC topic: Marketing -> Total system of related activities designed to plan,
price, promote and distribute products to potential customers – identifying,
satisfying, exchanging & communicating.
25% of indicative time
The focus of this topic is the main elements involved in the development and implementation of
successful marketing strategies.
Outcomes
The student:
H1 critically analyses the role of business in Australia and globally
H2 evaluates management strategies in response to changes in internal and external
influences
H3 discusses the social and ethical responsibilities of management
H4 analyses business functions and processes in large and global businesses
H5 explains management strategies and their impact on businesses
H6 evaluates the effectiveness of management in the performance of businesses
H7 plans and conducts investigations into contemporary business issues
H8 organises and evaluates information for actual and hypothetical business situations
H9 communicates business information, issues and concepts in appropriate formats
H10 applies mathematical concepts appropriately in business situations
Content
Students learn to:
examine contemporary business issues to:
 explain why goods and/or services are central to both marketing and operations
 examine why ethical behaviour and government regulation are important in marketing
 assess why a mix of promotional strategies is important in the marketing of goods and
services
investigate aspects of business using hypothetical situations and actual business case studies
to:
 evaluate the marketing strategies for a good or service
 analyse a marketing plan for a business
 explain how globalisation has affected marketing management
Key concepts: satisfying, needs and wants, exchanging, valuing, communicating, corporate
social responsibility, choice, ethics, market, ‘bait and switch’, differentiate, niche, sugging
SWOT analysis,
Students learn about:
role of marketing
 strategic role of marketing goods and services
 central + strategic role – to find the most suitable markets/make sure resources are directed to ensure
customers of that market buy product – use of opportunity
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interdependence with other key business functions
 marketing does not occur in isolation & impacts finance, operations, employment relations e.g. new
marketing campaign = more products/new services =greater production, further staff training + $$
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production, selling, marketing approaches
 Product-if business has a better product, customers will naturally want it. Emphasis on quantity &
reducing costs. Demand greater than supply
 Sales-Businesses think of customer only after the product is made. Emphasis on selling &
advertising. Supply greater than demand
 Marketing-Focus on the customer’s needs/wants. Emphasis on customer satisfaction. Modificationsocietal approach emphasises quality, safety, the environment.

types of markets – resource, industrial, intermediate, consumer, mass, niche
Market
Characteristics
Example
Resource
Where the factors of production (land, labour,
capital & enterprise) are sold/exchanged – these
resources are then sold to firms producing
goods/services for consumers
Mining company discovering
iron ore
Industrial
Those who buy goods/services that go into the
production of other products
Ford motor company, sourcing
parts to complete vehicles
Intermediate
Those who buy goods/services to resell/rent them
to others –wholesales –steps to produce the final
product
Hertz, antiques
Consumer
A market for goods at their final point of
consumption
Department store
Mass
Market for goods appealing to the majority of
customers/
Milk, electricity, bread
Niche
Smaller markets for more specialised
goods/services, appealing to fewer people
Jeweller specialising in bridal
jewellery
influences on marketing
 factors influencing customer choice – psychological, sociocultural, economic,
government
Psychological- Internal personal motivations (aspirations, likes/dislikes, hobbies) –will the product improve
my appearance/self-image/status?
Sociocultural-Influence of social/cultural background (friends, family, religion, ethnicity, income,
education, reference groups, values etc.) –does this product relate to my religion/background? Will the
product harm my relationship with peers/family?
Economic-Influence of greater economic trends (unemployment, interest rates, economic growth/decline)
along with individual/family income level – can I afford this? Is it better value?
Government-Influence of government in legislation and regulation of markets – income tax, interest rates
impact ability to purchase. Is there a law about purchasing this product? Are there advantages/conditions
relating to government policy affecting this product? Will Gov. taxes make this more expensive?

consumer laws
– deceptive and misleading advertising
Overstating benefits, offering discounts that don’t exist, bait & switch advertising. Consumers are
responsible for reporting breaches
– price discrimination
Providing stock at a lower price to that offered to competitors of a preferred retailer. Discounts for bulk
buying are however legal.
– implied conditions & warranties
Reguardless of warranty, a business must either refund or exchange goods recognized as faulty at the time
of leaving the store, this is implied warranty
*ALL PART OF THE COMPETITION AND CONSUMER ACT

ethical – truth, accuracy and good taste in advertising, products that may damage health,
engaging in fair competition, sugging
Ethical behaviour refers to the generally accepted code of behaviour. When marketing
business should act in an ethical way, considering:- health concerns/social obligations, cost
of marketing-so we aren’t paid to be marketed to, marketing can be anti-competitive,
sugging- customers are approached to complete a survey then sold a product.
marketing process
 situational analysis (current situation of business)– SWOT, product life cycle (introduction,
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growth, maturity, post-maturity) –different marketing strategies should be used as products travel through
the product life-cycle
market research –primary research (focus groups, surveys, interviews)*observational/experimental –
secondary research (census data, competitor’s sales data, annual reports)*internal/external
establishing market objectives –Specific Measurable Achievable Realistic Time(bound)
identifying target markets –to appeal to a target market the business needs an indepth understanding of
the nature of consumer markets
developing marketing strategies –Product, Price, Promotion, Place, People, Proccessed, Physical
evidence
implementation,-what, how and why of strategies –organisational structure + skills and expertise
monitoring –work in progress checks, -bugets, sales analysis, targets and controlling –cash flow
statements, balance sheets, profit and loss developing a financial forecast; comparing actual and
planned results, revising the marketing strategy
marketing strategies
 market segmentation,

 identifying niche markets within a mass market by grouping people with similar characteristics.
Demographic (age, sex, education etc.), Geographic (location), Psychographic(why- lifestyle, social
class, personality), Behavioural (consumer loyalty, purchase occasion)
 product/service differentiation – how businesses separate themselves from the competition
 Positioning-Process or marketers creating an image/identity for their product/brand/organistation
these can based on factors such as price, quality, value, luxury, safety. A positioning matrix may be
helpful. Positioning strategies include: positioning by benefit, price or quality, direct comparison
(create the image of superior product e.g. coke/pepsi), usage occasion or users (e.g. thredo ski resort
–winter hiking, other sports/events –summer)
products – goods and/or services – should also be seen as felxible & product range/use, what to
ephasise, position should all be taken into consideration
– branding
 A brand name is a way of distinguishing a product from its competitors, branding strategies
include: generic brand (e.g. no frills), individual brand (each major product has its own name e.g.
Unilever- dove, lux etc.)
– Packaging

 Often first image of the product – image should be positive and effective while aiming to protect and
maintain quality. Should offer a reason to purchase product, this may be: nutritional info, benefits,
feature, design & colour. Relevant to sales – willingness to assist
price including pricing methods – cost (price determined by cost of good plus a set %), market,
(figure based on supply/demand e.g. bananas going up when crops are low) competition-based (setting a
price to compare directly to competitors e.g. beat competitors by 10%)
– pricing strategies – skimming (initially very high price which is gradually skimmed e.g. ps3) ,
-penetration, (setting prices very low to gain an immediate group of customers)
-loss leaders (some great deals to entice you into store in the hope you will buy more e.g. coles
weekly specials)
- Price points (selling a product for a set amount so customers can choose e.g. phones plans $30, $45
etc.)
-prestige pricing, product deletion (clearance), demand based (e.g. iPhone),
psychological pricing ($19.99)
– Price and quality interaction –this mix should be correct, you can’t successfully sell a
low quality product for a high price vice versa. E.g. Lexus prestige car, low price =
low sales, high (prestige) price = increased sales.
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promotion
– elements of the promotion mix
- Advertising –To persuade a target market, TV, radio, online, print etc. Advertising which often
aims to build brand image is a more long term process than sale promotions
- Personal selling and relationship marketing –Sales representative persuades customer
through depth of knowledge and personal characteristics, message can be tailored to suit customer
- Sales promotions –Short term attempts for customers to buy more of a product e.g. price
reduction, cash back, gifts. Can be below-the-line (non-media communication) especially for new
products e.g. food samples
- Publicity and public relations –Planned establishment of goodwill, promotion of a
business/products in most favorable light. –made most credible by an outside source e.g. magazine
– the communication process – opinion leaders (individuals, typically held in high esteem, often
more influential than the media, seen as trustworthy. E.g. sportspeople, experts, celebrity spokesperson)
word of mouth (argued that customers put more weight on WOM rather than TV/newspaper)
place/distribution -> how it gets to the customer
– distribution channels (business/s involved in moving goods from manufacturer to point of sale –
intermediary –allows to reach new/smaller markets, more efficient –less of companies resources, help
match supply/demand)
– channel choice (direct/indirect (use of intermediaries)– intensive (available everywhere e.g. soft
drinks), selective(easily available but manufacturers choose where), exclusive (limited supply for
elite image or require specialist installation e.g. Ferrari)
– physical distribution issues – transport, warehousing(storing products), inventory(quantity
of products available for sale)
people, (having the right staff e.g. customer service, product knowledge) processes (total experience of
buying the product –meeting expectations) and physical evidence (physical appearance across all
aspects of presentation, can mean clothng, office)
e-marketing –Internet marketing, fastest growing in Aust. e.g. youtube, email, pop ups, adds on sites,
competitions –benefits: reach, interactivity, immediacy
global marketing
– global branding –brands have the same meaning in another language, easier to promote a brand vs.
product. recognizable
– standardization –a business may not need to alter its product for different countries/cultures
– customization –in some situations it is more effective to differentiate some aspects of a product to
suit different cultures
– global pricing –should add to the reputation of the brand with awareness of currency
exchange/transport, loss leader strategy can be used an made up in other markets
– competitive positioning-how a business differentiates its products. It centers on how a business
will carve out a place in the competitive marketing environment.