2. BM Unit 2 - LO21 Higher Business Management Marketing

3. BM Unit 2 - LO22 Success Criteria: To introduce the concept of MARKETING. Learning Intentions: Give a description of marketing and what it means to you. Use general knowledge of marketing within the Business world. Be ready to move into the full topic of marketing.

4. BM Unit 2 - LO23 Marketing – What it means to me?

5. BM Unit 2 - LO24 Marketing “The process involved in identifying, anticipating and satisfying consumer requirements profitably”.

6. BM Unit 2 - LO25 Identifying Consumers’ Requirements n What do they want? Consumers must buy products and continue to do so n Fierce competition and consumers’ expectations mean that products must be constantly updated and altered to suit n Other factors - price, quality, prompt delivery, attractive packaging and after- sales service n Advertising and promotion play a big part

7. BM Unit 2 - LO26 Anticipating Consumers’ Requirements n What do they want today? n What do they want in the future? n Trends must be considered to anticipate future needs n Volatile markets - fashion, toys, technology (mobile phones, computers, etc)

8. BM Unit 2 - LO27 Satisfying Consumers’ Requirements “The customer is king!” n Businesses must be customer-focused n No customers no business n Must offer - good service, quality products, value for money, prompt delivery, good after-sales service (eg returns), well presented and packaged goods, at the right price and available at the right place

9. BM Unit 2 - LO28 Success Criteria: To introduce marketing casualties and success stories. Learning Intentions: Identify and describe marketing casualties in both the UK and World-wide markets Identify and describe marketing success stories in both the UK and World-wide markets

10. BM Unit 2 - LO29 The casualties of not adapting to the market n The American car industry n The British motor cycle industry n In pairs have a discussion to see if you can think of any others.

11. BM Unit 2 - LO210 Marketing Successes n Swatch n Starbucks n Easyjet and Ryanair n http://www.businessstudiesonline.co.uk/live/index. php?option=com_content&view=article&id=35&Ite mid=23 http://www.businessstudiesonline.co.uk/live/index. php?option=com_content&view=article&id=35&Ite mid=23 n http://www.businessstudiesonline.co.uk/live/index. php?option=com_content&view=article&id=35&Ite mid=23 http://www.businessstudiesonline.co.uk/live/index. php?option=com_content&view=article&id=35&Ite mid=23 n In pairs have a discussion to see if you can think of any others.

12. BM Unit 2 - LO211 Marketing - a Strategic Activity (long term!) n Inception/design n Price n Distribution n Selling and promotion n After-sales services

13. BM Unit 2 - LO212 Assessment (looking) of the Market n Where are the consumers of the product? n How many consumers are there? n What are their attitudes and preferences? n How effective are the distribution methods? n What are the strengths and weaknesses of competitors?

14. BM Unit 2 - LO213 Product v Market Leader

15. BM Unit 2 - LO214 Product-led - Product Orientated and Production Orientated n Putting a product on the market without prior market research n Assumption of best available and no real competition n Often new inventions like Dyson vacuum cleaners or Playstation 2 n A risky approach which can fail - British motor bikes n Making as many products as possible at the lowest price

16. BM Unit 2 - LO215 Market-led - Customer Orientated and Sales Orientated n Considering what the customers want before putting a product on to the market n Competition has led to companies focusing on the needs of the customer n Also looks at the influences on purchasing decisions n Pressure to sell to the public

17. BM Unit 2 - LO216 Marketing Products and Services n Consumer goods n Industrial goods (capital goods) n Services (intangible)

18. BM Unit 2 - LO217 The Marketing Environment THE MARKET Consumer trends and behaviour Technology GovernmentCompetition The economy

19. BM Unit 2 - LO218 Branding

20. BM Unit 2 - LO219 Branding n Branding distinguishes a product from its competitors n Instantly recognisable by consumers n Often linked to quality and reliability n Can command a premium price

21. BM Unit 2 - LO220 Unique Selling Point (USP) n Try to identify the USP of each of the products listed opposite n Think of how they are presented to you in the advertising you see daily on TV, in newspapers and magazines n Coca Cola n Nike n Kit Kat n Sunny D n Skoda Cars n Mercedes Cars n Baxter’s Soups n Fairy Liquid n Finish (dishwasher tablets)

22. BM Unit 2 - LO221 Own Brands n Products branded with the name of the store selling them n Most of the big supermarkets (Tesco) and chain stores (Boots) have their own brands n Often cheaper alternatives to branded goods n Make a list of as many “own brands” you can think of. Indicate which branded product they are designed to rival n Eg “Wheat Bisks” by Morrisons to rival “Weetabix”

23. BM Unit 2 - LO222 The Marketing mix

24. BM Unit 2 - LO223 The Marketing Mix ProductPeople Price Physical Environment Promotion Process Place

25. BM Unit 2 - LO224 Product

26. BM Unit 2 - LO225 Product/Service n Core n Actual n Augmented n The basic product - eg toothpaste cleans teeth n The way the product is presented - design, brand name, packaging, etc (Colgate toothpaste - red packaging) n Additional features - protection against decay, fresh breath, attracting the opposite sex, etc

27. BM Unit 2 - LO226 The Product Life Cycle Time £000 Costs/Sales Idea New Product Launch Youth GrowthDecline Maturity (Saturation) Death

28. BM Unit 2 - LO227 Extending the Product Life Cycle n Changing the product - size, colour, taste n Providing variants - Mars: fun-sized, yoghurt, ice cream, mini-sized, giant-sized n Altering the packaging for different market segments n Altering the channels of distribution n Changing the price n Special promotions - offers, gifts, competitions

29. BM Unit 2 - LO228 The Product Mix n Very few companies have only one product n Some companies have a range of related products eg Proctor & Gamble n Some companies have totally unrelated products in their product portfolios eg Imperial Group n It is important that you have new products being launched to replace products going into decline in your “Product Mix”

30. BM Unit 2 - LO229 Product Innovation n Generating an idea n Analysing the idea n Producing a prototype n Test market n Adapt product to solve problems n Launch the product

31. BM Unit 2 - LO230 Success Criteria: To introduce PRICE. Price being one of the factors linking into the MARKETING MIX. Learning Intentions: To enable pupils to: describe pricing objectives identify how businesses use pricing strategies to price products and services describe short-term pricing tactics and give current examples be able to describe pricing methods and elasticity of demand

32. BM Unit 2 - LO231 BBC Price Clip n http://www.tutor2u.net/blog/ind ex.php/business- studies/comments/pricing-in- uk-supermarkets/

33. BM Unit 2 - LO232 The Price of a Product? n The price of a product is one of the main factors in buying that product. Too low a price could give the impression of poor quality and too high a price may not give the feeling of value for money n Price is influenced by:- the product being new, what competitors are charging, the product’s stage in its life- cycle, the selling location, the market segment and many other factors

34. BM Unit 2 - LO233 Pricing Strategies n Low-price strategy in a market with strong competition n Market-price strategy petrol – matching competitors n High-price strategy up-market, exclusive image

35. BM Unit 2 - LO234 Short-term Pricing Tactics n Skimming – high initial price for max profit n Penetration – low initial price for new product ( n Destroyer – eliminating the competition (‘EasyJet’/’Ryanair’) n Promotional – lowering prices for a period to ‘promote’ more sales n Demand-oriented – charging different prices according to the level of demand eg cross-channel ferry fares in summer

36. BM Unit 2 - LO235 Place

37. BM Unit 2 - LO236 Place - Distribution Channels Producer 1Producer 2Producer 3 ConsumerRetailerWholesaler RetailerConsumer

38. BM Unit 2 - LO237 The Wholesaler Function n Buys in bulk from producers (low transport costs) and sells to retailers in smaller quantities n Bears stock-holding risk n Offers a wide variety of goods in small quantities n Packages and labels goods n Offers advice to both producers and retailers as to which goods are selling well

39. BM Unit 2 - LO238 The Retailer Function n Breaks down bulk to quantities consumers wish to buy and store at home n Provides information to consumers through advertising, displays and trained staff n Stores a variety of goods, displays them and marks on prices n Offers range of related services - credit, HP, after-sales service and delivery

40. BM Unit 2 - LO239 Types of Retailer n Independent - convenience stores, corner shops n Multiple Chains - M&S, Dixons, Boots n Supermarkets - Tesco, Asda, Safeway, etc n Co-operatives n Department Stores - Jenners, Harrods, Selfridges n Franchises - Benetton, Body Shop, McDonald’s n Others - mail-order, internet, direct-response advertising, telephone and TV shopping channel

41. BM Unit 2 - LO240 Success Criteria: To introduce PROMOTION. Promotion being one of the factors linking into the MARKETING MIX. Learning Intentions: To enable pupils to: describe types of promotional activities identify how businesses use promotional techniques to sell products and services describe types of advertising and give current examples describe the role of Public Relations (PR) within promotional activity.

42. BM Unit 2 - LO241 Promotional Strategies Three main aims: n Persuading - to purchase the products n Informing - telling consumers about the product n Reminding - that the product still exists

43. BM Unit 2 - LO242 Main Types of Promotion Above The Line n TV and newspapers to reach mass audience n A lot of waste Below The Line n Directly controlled by the business n Sales promotion, direct mail, trade fairs - targeted consumers who may be interested

44. BM Unit 2 - LO243 Main Types of Sales Promotion Into the pipeline n Enhancing sales to trade outlets n Helping retailers to sell to their customers eg displays, posters, videos, etc Out of the pipeline n Helping to persuade customers to buy from retailers n Providing free samples, a percentage extra free, 2 for 1 offers, money-off coupons, etc

45. BM Unit 2 - LO244 Advertising Decisions n The effect on Sales? n The target market? n Why do the consumers NOT buy the product? n Which is the best medium to use?

46. BM Unit 2 - LO245 Types of Advertising Media n Print - newspapers and magazines n Broadcast - TV, radio and cinema http://www.tellyads.com/recen t_additions.php http://www.tellyads.com/recen t_additions.php n Outdoor - billboards, posters, etc

47. BM Unit 2 - LO246 Public Relations (PR) n Improving the image of the product and organisation n Supporting and promoting a charity n Sponsoring sporting or cultural events n Product endorsement by celebrities n Press conferences and press releases in times of difficulty or when good publicity can be obtained

48. BM Unit 2 - LO247 Success Criteria: To introduce MARKET RESEARCH and MARKET SEGMENTATION. Learning Intentions: To enable pupils to: 1.To introduce pupils to market research and techniques, linking to marketing mix from previous lessons. 2.To introduce ICT and how it links to Market research 3.How linking MKT RES and Market segmentation creates a common goal – to aim product or service at particular group. 4.To be able to summarise marketing topic.

49. BM Unit 2 - LO248 Market Research - Definitions “Market research is the systematic gathering, recording and analysing of data about problems relating to the marketing of goods and services.” “Market research is the means by which those who provide goods and services keep themselves in touch with the needs and wants of those who buy these goods and services.” http://www.businessstudiesonline.co.uk/live/index.php?option=com_content&view=article&id=49&Itemid=48

50. BM Unit 2 - LO249 The Need for Market Research n Predict changes required in its product/service n Identify what is selling n Identify who is buying the product/service n Explain what is happening in the market n Investigate possible courses of action n Identify the size of the market n Discover what consumers think of the product n Discover what consumers are willing to pay n Discover if a promotion is appropriate n Discover if the packaging is appropriate n Identify what competition exists - now and in the future

51. BM Unit 2 - LO250 Methods of Research - Primary n By observation or asking people questions n Up-to-date n Collected for the exact purpose of the organisation n Not easily available to competitors n Time-consuming n Expensive Primary data is gathered by field research

52. BM Unit 2 - LO251 Market Research - Secondary n Sales figures n Stock figures n Accounting records n Customer comments n Sales reps reports n Market research data gathered previously n Government publications - social and economic trends, annual statistics, population census n Competitors’ data - annual reports, promotions, price lists, web sites n Newspapers, trade magazines, Mintel (research org), etc External SourcesInternal Sources

53. BM Unit 2 - LO252 ICT and Market Research n Databases compiled by research agencies n Electronic point of sale information (EPOS) n Supermarket loyalty cards n Stock control software gives sales breakdown n Web sites - customers can e-mail comments back to the company

54. BM Unit 2 - LO253 Problems with Market Research n Sampling Bias - small sample can give a wrong impression n Human Behaviour - opinions change rapidly n Interviewer Bias - leading questions may be asked

55. BM Unit 2 - LO254 Market Segmentation Advantages n Seller can meet buyers’ requirements n Advertising can be focused - less wasteful n Expertise developed for a specific market n Higher sales n Increased profits “Breaking down of markets into sub-groups that can be targeted with a specific marketing mix.”

56. BM Unit 2 - LO255 Methods of Segmentation n Age n Gender n Socio-economic grouping n Education level n Income n Religion n Residential area n Lifestyle preferences - hobbies, politics

57. BM Unit 2 - LO256

58. BM Unit 2 - LO257 The Marketing Topic This is probably the most important topic in Higher Business Management. Do as much reading on it as you can and arm yourself with as many up-to-date examples of marketing as you can!

59. BM Unit 2 - LO258 The Marketing Environment THE MARKET

60. BM Unit 2 - LO259 The Product Life Cycle Time £000 Costs/Sales