Main Tools of Marketing - Research Paper Example

? Summaries of five lectures inserts his/her Inserts Marketing Research is discussed in Lecture 2 which refers to the systematic gathering, analyzing and reporting of data to assist business decisions. Ad-hoc research is conducted as a one-time event, whereas, today mostly firms engage in continuous research through analysis of television viewing, retail audits, focus groups etc. The research process begins with identification of the problem which is the most difficult stage. Often companies overlook the actual cause by focusing on the tip of the iceberg. At this stage, companies also decide whether to undertake exploratory (exploring the motivations of consumers), descriptive (answering questions such as what, where, when, how) or causal (establishing cause-effect relationships in consumer’s behavior) research. Next, a plan is formulated which is implemented by collecting either primary or secondary data is the desired manner. There are two main types of research: qualitative (comprising of focus groups, observations and third-person techniques) and quantitative. Primarily, companies engage in research by employing the four core media; that is, telephone, internet, mail and face-to-face conversations. For instance, Pepsi conducted a blind-taste test (known as Pepsi Challenge) where consumers were told to taste two cups (one with Pepsi one with Coke). The results revealed that Pepsi was the popular choice amongst Americans. Lecture 3 discusses the three core steps of marketing namely segmentation, targeting and positioning. Segmentation refers to grouping the population into categories based on common characteristics pertaining to behavior, psychographic elements or profile of customers. Segmentation based on behavioral aspects tends to focus on the purchase behavior, benefits, features, usage patterns as well as perceptions of the customers. Psychographic segmentation is based on lifestyle patterns and personality traits of the customers. Profile refers to categorizing the market based on age, income and socio-economic status. Targeting comes after segmentation and refers to the selection of one or more such groups towards which the elements of the marketing mix are aimed at. These segments are evaluated on the basis of criteria such as their potential profitability, size, as well as their coherence with the organizational goals. Finally, positioning refers to the whole or space in customers’ mind that the company wishes to acquire. In short, the company decides the area in which it would differentiate itself from competitors as well as how it intends to do so. For example, Diet Coke positioned itself against Coke Zero by appealing to a different target market (women) compared to Coke Zero that targeted athletics and sportsmen. Lecture 4 discusses the buyer behavior process. This begins with an analysis of the various roles that consumers take on as “initiators”, “influencers”, “deciders”, “buyers” and “users”. A personal consumer is one who is the end user of the product bought, whereas, an organizational consumer is one who buys with the intention of using the product in the manufacture of some other product. The process of making decisions involves recognition of the fact that the consumer has an unsatisfied need which he/she attempts to satisfy, searching for potential ways to satisfy that need, evaluating alternative products on the basis of various criteria, purchasing and finally, evaluating the decision in retrospect. When the product falls short of the customer’s expectations he/she may experience cognitive dissonance. Consumers purchase products owing to peer pressure (for instance, a Mercedes to show off his status) as well as his/her personality traits (for instance, drinking ground coffee instead of Nescafe’s 3-in-1 satchel). The buying process for organizations is far more complex and involves a more rational, well-informed choice as opposed to purely hedonic or impulsive behavior displayed by individual customers. Since business buying involves heavy investment, suppliers are selected on the basis of the lowest offer, credibility, guarantee and many other rational factors. Pricing, as discussed in Lecture 7, involves considering the cost of production, the competitor’s benchmark as well as the perceived differential. Factors such as the overall positioning of the product, the stage of lifecycle it is at, the strategy followed for others in the same product line, management of the retail channel, competitors’ strategy as well as the global strategy of the firm determine the pricing for a product. Positioning and pricing are closely related; for instance, Southwest Airlines has positioned itself as a low-cost career which it promotes in its ads. Similarly, Wal-Mart offers “Everyday Low prices” which is its USP. Furthermore, new entrants may follow either market skimming or penetration. Owing to competitive pressures, the company can either charge a price lower than, equal to or greater than its rivals. Also, at any time prices may be changed in line with changes of competitors’ prices. Also, the larger the number of intermediaries or retailers involved, the greater the room for margins that the list price must incorporate. A major factor when dealing with international pricing is the escalation of prices. For e.g. the car manufacturer Toyota may be pressurized into increasing prices in a region where customs, tariffs and duties have risen. Lecture 8 discusses the distribution (used interchangeably with Place) aspect of the marketing mix. It simply means that the right product should be available at the right time to the right customer. The channels range from the classic channel that involves the agent, wholesaler and retailer to one which is “direct” and involves just the manufacturer and end consumer. For services, there are mostly 2 choices, either a direct approach or one involving an agent. For e.g. airline tickets may be booked directly with the airline’s office or via a third-party or agent that helps the customer get the desired flight, fare etc. Channel strategy incorporates the aspect of selection, integration and the decision of intensity of distribution. For e.g. Jimmy Choo’s perfumes follow an exclusive distribution, whereas, The Body Shop’s perfumes follow a selective one. Channel management is complex and requires management of middlemen, training the parties involved, avoiding stock outs as well as their performance evaluation. For e.g. Unilever has a strong bargaining power and control over its distributors owing to its strong brand presence which makes it easier for the company to attract highly qualified and efficient distributors. Read More