Marketing Principle

Nelson College 15/04/2013

MARKETING PRINCIPLES
UNIT 4
BTEC Higher National Diplomas (HND) In Business

LECTURER: Isaiah Oino

STUDENT: Elena Ramona Botez
ID: 9120103
SUBMISSION DATE: 15/04/2013
Elena Ramona Botez

Page 1

Marketing Principle

Nelson College 15/04/2013

INTRODUCTION
In the this modern world, marketers want to build a customer driven marketing strategy
for creating lasting customer relationships. To do this, they can use one of the five marketing
management philosophies as: production, product, and selling, marketing and societal
marketing concept. The appropriateness of these philosophies depends on the nature of the
business and target market. This assignment will discuss each of these philosophies for a
particular product and compare them. One of the products is TATA NANO, the world
cheapest car. The modern concept of Marketing is a total system of interacting business
activities designed to plan, price, promote and distribute want-satisfying products and
services to present and potential customers. (William, 1978) The modern marketing is
abroad and customer oriented concept. One of the most important components of marketing
is the Marketing Mix. The Marketing Mix must be delivered in the right way to the right
people at the right time. It is important that all the elements are given equal and balanced
importance and managed. Marketing Mix is considered as the blend and batter of the
ingredients that determines the appreciation by the consumers.

Elena Ramona Botez

Page 2

Marketing Principle

Nelson College 15/04/2013

A.C.1.1 Explain the various elements of the marketing process

Marketing can be defined as: The management process responsible for identifying,
anticipating and satisfying customer requirements profitably (The Chartered Institute of
Marketing, year). This definition emphasises how wide Marketing is within an organisation
from identifying customers needs and wants by carrying out valuable research that can
eventually be profitable to that organisation. Satisfying needs and wants through an
exchange process (Kotler, 2008). The decision-making process has as a starting point the
needs of clients, but cannot be ignore those two important factors of markets: competition
and change. Marketing should be seen not just as a service of a department, but the
philosophy of the organisation in its whole.
Product-if the product is not good enough to satisfy customers needs, no marketing can
make it sale and its features are on quality, branding, attractive packaging, warranty is the
success of success or failure of the product.
Price - the cost of the customer. The price of the product is the amount of money that the
customer has to pay for a product or service. The cost of the customer is the amount of money
that the customer is willing and has at its disposal, to pay for a product or service.
Placement Comfort The investment is aimed on making the product available to the public.
We all know that the market is the place where the demand meets supply. There is the
comfort of the client who will rather order via the Internet, for reasons of comfort, rather than
to go to the store and buy a product from there (Needham, 1999).
Promotion The promotion includes the activities that communicate the merits of convicting
and target customers to buy it. Promoting a product is perceived as a communication, it
should be. It is crucial that the promotion to be carried out in a more personal way, people to
people (Kotler and Armstrong 2008).
SWOT analysis will help to determine which new products to introduce in the company and
Elena Ramona Botez

Page 3

Marketing Principle

Nelson College 15/04/2013

examine how existing products are doing.

Strength the company has an advantage over the other companies because it sales are
associated with good quality.
Weaknesses the size of the company is too small and the product is week because is based
at a particularly type of person or age group, or the company has a small amount of money.
Opportunities is for the company to expand over growing population of that area.
Threats the company products can be found also in the other market (competition)(Neil
1984).
On the basis of analyses marketing process an organisation overall strategy is identified as an
integrated strategy with differentiation and focus on product, price and promotion to meet the
customers demand, and it also combines with focus strategy to build the customers
satisfaction and loyalty.(Pettit 1997).

A.C. 1.2. Evaluate the benefits and costs of a marketing orientation.

Market orientation has been characterised as that part of an organisation that requires
customer satisfaction to be paramount within the operations of a business (Liu 2002). This, in
turn, produces superior value for customers and outstanding performance for the firm
( Narver and Slater, 1990).The marketing concept is about an equilibrium between companys
capabilities and customers wants, and holds the desire and needs of the target market must be
determined and satisfied in order to successfully achieve the goals of the producers. The main
elements of marketing concept are follows: customer orientation, mutually profitable
exchange and anticipation and organisation integration (Mintzberg, 1996).
Market oriented companies are characterised by their focus on the customers, and work to
understand who their customers are and what they want. The company strategy and practice
Elena Ramona Botez

Page 4

Marketing Principle

Nelson College 15/04/2013

supports a long term approach to the vendor-customer relationship, and instead to push the
products, the company try to identify and provide solutions to meet customer needs. Some
organisations are sales oriented, others are engineering driven.(Gronroos 2007).
Benefits
According to Floyd (2002) some of the benefits of the marketing approach an orientation
are: improve communications, competitive advantage, customer loyalty and trust, achieve
better co-ordination of activities, profits to grow the business, achieving long term goals,
referrals from satisfied customers and increase customer base, up to date comprehensive
knowledge of the target markets.
Costs
The main costs involved in marketing orientation are considered as the direct or indirect
costs, and could be summarised as: cost of customer retention, advertising and promotion
costs, cost of regular market research, todays product is tomorrow throwaways, cost of
initial product development, staffs cost including wages an each department, cost of setting
up the marketing oriented organisation structure. Sometimes costs outweigh benefits but with
the right leadership it can be reversed (Borden, 1994)

A.C.2.1 Show macro and micro environmental factors which influence marketing
decisions.
As the market environment changes, managers have to adapt their strategies and
organisation. Unless these changes are made, the business will no longer fit the needs of the
moment - it will be made obsolete by changes in customer wants, new technologies and new
competitors that have adapted more effectively" (Doyle, 2002). Marketing decisions have to
take into account the Macro and Micro environments which will influence the company and
its decisions.
Elena Ramona Botez

Page 5

Marketing Principle

Nelson College 15/04/2013

The micro-environment, are internal factors close to the company that have a direct impact on
the organizations strategy and decisions.
Customers As all businesses need customers, markets need to be observed closely, as
companies will only survive if they are meeting their needs and wants.
Employees Making sure that the correct skilled staff is employed are essential, as is keeping
them motivated, if not will affect customer service and ultimately sales. Training and
development is needed for companies to stay ahead of the game (Hooley, 1998).
Suppliers .Plays an important role, if prices are increased for materials or manufacturing, this
will increase prices and affect profits and if there are delays with manufacturing or supply of
goods, customers will be affected and customer satisfaction may be lost.
Shareholders .As organizations need greater inward investment for growth they face
increasing pressure to move from private ownership to public. Satisfying shareholder needs
may result in a change in tactics employed by an organization and will difficult for the
company to keep to its core values, when shareholders are more concerned with
profit(Joober,2007).
Media - positive or negative media on an organizations product or service can in some cases
make or break an organization. Consumer programs such as Which and Watchdog, have a
wide audience can have a very powerful impact, forcing organizations to change their plans.
With technology such as the internet, word is soon spread and whilst a company image takes
a long time to create, it can be quickly demolished.

Elena Ramona Botez

Page 6

Marketing Principle

Nelson College 15/04/2013

Diagram 2. www.allaboutmarketing.blogspot

The macro environment involves looking

at uncontrollable variables that influence the company. This is always changing, and the
company needs to be flexible to adapt; Tax changes, new laws, trade barriers, demographic
change and government policy changes are all examples.

Demographic environment is

related the study of human populations in terms of size, density, location, age, sex, race and
can be used to target market campaign. It is people who make market and contribute to the
demand which helps in produce and supply.

Economic

environment include salary levels, credit trends, and pricing patterns- that affect consumer

Elena Ramona Botez

Page 7

Marketing Principle

Nelson College 15/04/2013

spending habits and purchasing power. The state of the local and global economy has had a
big influence on any organization (Brassington, 2007).
Natural environment involves all the natural resources, such as raw materials or energy
sources for the production of a product needed by companies. Concerns for the environment
have increased vastly over the years and there is an increased demand for businesses to take
greater care and responsibility for it. Environmental issues could mean shortages of raw
materials, increased cost of energy, increased air pollution and damage to landscapes and
wildlife.
Technological environment Include IT, Changing Work practices and Ecommerce, and change
every fort night. Many businesses have now taken to trading online as well as by phone or
in person, being technologically upgraded and using the latest technology which provide
competitive advantage over the competitors. On this time can be seen many indescribable
innovations like Tata Nano, Apple I phone, M-commerce etc.
Political and legal environment includes all laws, government regulations , and lobbying
groups that influence or restrict individuals or organizations in the society, policies like traffic
light(how much sugar and salt on products),displaying the expire date, selling alcohol and
cigarettes etc. Also there is a large customer group who oppose any unethical acts by the
business (e.g. Coca Cola suffered lots of opposition as pesticides were found in its cold
drink).
www.managementfunda.com

A.C. 2.2. Propose segmentation criteria to be used for products in different markets, in
Tata Nano scenario.

Elena Ramona Botez

Page 8

Marketing Principle

Nelson College 15/04/2013

According to Strydom(2008), market segmentation according is the process of dividing the

total heterogeneous market for a product into several segments, each of which tends to be
homogeneous in all significant aspects. Then select one or more market segments as target
market. The firm develops separate marketing mix for each segment or group of segments in
the market. The TATA NANO is a giant family business that dominates the Indian markets.
The group comprises of 91 operating companies in seven business sectors. These sectors are
as follows, information systems and communications; engineering; materials; services;
energy; consumer products and chemicals. Generally Tata Nano follows the marketing
segmentation concept and they have succeeded which already prevails in the history. Tata
Nano which come under the passenger car segment was launched in January 2008, using the
segmentation on variable orientation as : geographic rural and urban, where market was
segmented around the needs and to satisfy each segment, demographic family size and
income, behavioural benefit and users status.
Tata Nano was entered on market segmentation with the pricing strategy of market
penetration and will focus mainly in lower and middle income group, and on the customers
buying a new car rather than investing in a second hand car. From this point of view Tata
Nano will be a great option for customers as it is a new smart car with all the facilities and
priced at a lower rate when compared with a second hand car with no facilities or standards
as per rules (www.tatamotors.com/our_world/profile.php).

A.C. 2.3. Choose a targeting strategy for a product or service.

According to Kotler(2006) targeting as the act of developing measures of segment
attractiveness and selecting one or more of the market segments to enter.
Market targeting - The process whereby one or more of the market segments previously
identified are evaluated and selected. To begin target marketing the business needs to identify
the different market segments. To identify these, the business separates the market into
different groups, mutually exclusive, but at the same time have comparable characteristics in
one group. Next stage of targeting focuses on evaluating and selecting one or more previously
identified market segments, which according to Kottler(1984), the select segment must be
distinct, assessable, measurable and profitable. There are four different targeting approaches:
Elena Ramona Botez

Page 9

Marketing Principle

Nelson College 15/04/2013

price, promotion, place and product.

TATA NANO Company is targeting lower income group with family, first-time buyers of car
(fresh graduates) and motorcycle owners. TATA NANO motors has a targeted market
approach. Tata like any other multinational has targeted the middle income group population,
as they are larger in number. In order to sell a product a company has to first make public
there importance. The Product created by the company is made for the middle class group;
the product was planned such that it would provide quality and features well than those which
are already present. The reduced cost is one of the target strategies and should not
compromise on the quality and the safety. The Price of the product was decided to be around
$3000 including the taxes and other costs as the dealer margin and transportation costs.
Promotion of the product was not a problem to the company with its innovative ideas and the
low price tag attached the product attracted wide media attention, widely dispersed rural low
economy population.
The market skimming strategy is followed where it initially places price that would bring
large demand but then with the understanding of the response and the trend changes the cost
of the product is suitably fixed changing its characteristics according to the needs of the
consumers(www.tatamotors.com/our_world/profile.php).
Tata Nano implements the pricing strategy, which is to set a low price for a new car in order
to attract a large number of buyers and a large market share. This price strategy will be done
by achieving high sales volume, which will results in falling costs, allowing the company to
cut the price even further. Tata Nano main price objective are: maximum current profit and
maximum market share. These prices reflecting a strategy of taking a share from established
competitors.

A.C.2.4 Demonstrate how buyer behavior affects marketing activities in different buyer
situation.
Consumer buying behaviour identifies and studies the psychology of consumer buying
pattern and behaviour of when, why, how, and where people do or do not buy product
(Davidson, 1987). Hence, when studying on consumer buyer behaviour it looks at the
theoretical elements such as psychology, sociology and economics. An increase emphasis is
given on consumer decision making process and that has led to develop and study many
Elena Ramona Botez

Page 10

Marketing Principle

Nelson College 15/04/2013

consumer decision making models. Consumer decision making models such as "Black Box
model" the" six steps" consumer behaviour model which all gave insights to factors that
would affect the consumer decision making (Kotler, 1994).
Problem recognition generally the buying process starts when the buyer recognizes a problem
or need triggered by internal or external stimuli. Marketers need to identify the circumstances
that trigger a particular need by gathering a number of informations from number of
customers and to recognize the needs of the customers by basic research and trigger them. As
the population is growing in large numbers they needs are growing, so the market have to
develop such strategies so that it be reached to all people and too trigger their demands and
satisfied them(King,2005).
Information search can distinguish between two levels of involvement where person simply
becomes more receptive to information about the product. At the next level, that person may
enter an active information search: looking for reading material, phoning friends, going
online and visiting stores to learn product.
Evaluation of alternatives where consumers have a lot of alternatives as different schemes are
coming to market by different company. Customers different find the alternatives as they
have plenty of alternatives.
Purchase decision. In the evaluation stage, the consumers form the preferences among the
brands in the choice set. The consumer may also an intention to the buy the most valued
brand. They take the following sub decisions: dealer, quantity, timing and payment method.
Post purchase decision .After the purpose, the consumer might experience dissonance the
stems from noticing certain worrying features or hearing positive things about other brands
and will be alert to information that supports his decisions and marketers must monitor post
purchase satisfaction, post purchase actions, and post purchase product uses (Saunders,
1998). In the same time organisational buyer behaviour is different from the consumer
behaviour and involves more than one person on making decisions with the following stages:
recognise the problem, develop product to solve the problem, search for products and
suppliers, evaluate products relative to specification and select and order the most appropriate
product.

A.C.2.5 Propose new positioning for a selected product/service.

Elena Ramona Botez

Page 11

Marketing Principle

Nelson College 15/04/2013

Positioning is what the customer believes about your product's value, features, and benefits; it
is a comparison to the other available alternatives offered by the competition. These beliefs
tend to base on customer experiences and evidence, rather than awareness created by
advertising or promotion (Oliver, 1995). Marketers manage product positioning by focusing
their marketing activities on a positioning strategy. Pricing, promotion, channels of
distribution, and advertising all are geared to maximize the chosen positioning strategy.
For example, a company like Kellogg's is constantly developing new breakfast cereals for
adults and kids -the product element is the new product itself and getting the right price
involves examining customer perceptions and rival products as well costs of manufacture,
promotion involves engaging in a variety of promotional activities e.g. competitions, product
tasting etc., and place involves using the best possible channels of distribution such as leading
supermarket chains. The product is the central fact on which marketing energy must
focus(Floyd,1942).Finding out how to make the product, setting up the production line,
providing the finance and manufacturing the product are not the responsibility of the
marketing function. However, it is concerned with what the product means to the customer.
Marketing therefore plays a key role in determining such aspects as: the appearance of the
product - in line with the requirements of the market and the function of the product products must address the needs of customers as identified through market research. The
product range and how it is used is a function of the marketing mix. The range maybe
stretched or a brand may be extended for tactical reasons, such as matching competition or
catering for seasonal fluctuations. Alternatively, a product may be repositioned to make it
more acceptable for a new group of consumers as part of a long-term plan.
Tata Nano will position itself as the world cheapest car and yet does not compromise the
quality, safety and environment. This positioning will be achieved by leveraging Tata Nanos
competitive edge: industries experience from the parent company Tata Motor who has been in
vehicles industries (commercial, passengers & utilities) since 1945. Tata motor has good
supplier-manufacturer relationship with more than 100 components
(www.tatamotors.com/our_world/profile.php).

A.C.3.1. Explain how product are developed to maintain competitive advantage.

Elena Ramona Botez

Page 12

Marketing Principle

Nelson College 15/04/2013

MacMillan (1983) suggests that gaining a competitive advantage requires an understanding

and anticipation of response barriers, intelligence systems, preemption potentials,
infrastructure requirements, calculated sacrifices, general management challenges, and punch
and counterpunch planning. A product's life cycle is the stages of development and sales
figures a product goes through over its time on the market. For anyone thinking of developing
a new product for the general market this is an extremely important factor to consider when
determining whether the product is worth putting on the market at all and also in determining
the work involved at different stages in the products life.
Market introduction stage: costs are very high, slow sales volumes to start, little or no
competition, demand has to be created, customers have to be prompted to try the product,
makes no money at this stage.
Growth stage: costs reduced due to economies of scale, sales volume increases significantly,
profitability begins to rise, public awareness increases, competition begins to increase with a
few new players in establishing market, increased competition leads to price decreases
Maturity stage: costs are lowered as a result of production volumes increasing and experience
curve effects, sales volume peaks and market saturation is reached, increase in competitors
entering the market, prices tend to drop due to the proliferation of competing products, brand
differentiation and feature diversification is emphasized to maintain or increase market share,
industrial profits go down.

Elena Ramona Botez

Page 13

Marketing Principle

Nelson College 15/04/2013

Diagram 2. www.finntrack.co.uk

Saturation and decline stage: costs become counter-optimal, sales volume decline, prices,
profitability diminish, and profit becomes more a challenge of production/distribution
efficiency than increased sales.
A competitive advantage exists when the firm is able to deliver the same products with the
same benefits as competitors but at a lower cost (cost advantage), or deliver benefits that
exceed those of competing products (differentiation advantage). Thus, a competitive
advantage enables the firm to create superior value for its customers and superior profits for
itself(www.managementfunda.com ).

A.C.3.2 Explain how distribution is arranged to provide customer convenience

Distribution (or "Place") is the fourth traditional element of the marketing mix. The other
three are Product, Price and Promotion. Distribution in marketing acts importantly to attract
customers convenience therefore; the system of distribution of an organization can show the
key ability for the organization. Distribution is beneath the group of place and therefore
organizations build-up an accurate distribution technique so that its easily accessible to the
customers and it can improve possible sales for an organization (Baker, 2003). For example if
Fanta does not work on its distribution services and Fanta bottles are just accessible at their
Elena Ramona Botez

Page 14

Marketing Principle

Nelson College 15/04/2013

factories then consumers might not be keen to get them. Its more appropriate for the
consumer to purchase Fanta from a close by retailer as compared to getting it from factory
and retailers sell directly to end-users via a physical store, website or catalog. Therefore
distribution system of an organization can be both its weakness and strength. Businesses in
current scenario make sure that their distribution channel should be strong so that their
product is available where there is need. It should be easily accessible to the customers.
Companies make sure the availability of their products at retailer shops and stores where
customers can easily (http://marketingteacher.com/lesson-store/lesson-marketing-mix.html).
Direct/sales team: One or more sales teams that you employ directly. You may use multiple
teams that specialize in different products or customer segments.
Direct/internet: Selling through your own e-commerce website.
Direct/catalog: Selling through your own catalog.
Wholesaler/distributor: A business that buys products in bulk from many producers and then
re-sells smaller volumes to resellers or retailers.
Consultant: A consultant can develop relationships with businesses and can provide either
specific or very broad services; they may recommend a producers product or simply purchase
it to assign a solution for the customer (King, 2005).

A.C.3.3 Explain how price are set to reflect an organizations objectives and market
conditions.
The pricing is a factor of importance in marketing both in getting the product accepted by the
target market, in generating sufficient revenue for the organization and deal with the various
elements that constitute the price of marketing-mix. This is the only element, which generates
revenue when all the others talk about cost. Pricing is important in one more sense also. It is
highly risk prone decision making area and a slightly wrong decision can hamper the
revenue, growth and future of the company. However you may like a product; you cannot buy
that if the price of the product makes it unaffordable. Hence, the companies must use pricing
keeping in mind the customers they target at (Jobber, 2007).
Penetration pricing comes where price is deliberately set at low level to benefit from
customer's interest and establishing a foot-hold in to the market. It may be also used be used
at a later stage in the Products Life Cycle to save the product from premature death or
premature old age by switching from market skimming.
Elena Ramona Botez

Page 15

Marketing Principle

Nelson College 15/04/2013

Premium pricing - is the practice of keeping the price of a product or service artificially high
in order to boost good perceptions among buyers, based exclusively on the price. The practice
is planned to exploit the (not necessarily justifiable) tendency for buyers to assume that
expensive items enjoy an exceptional status or represent exceptional quality and distinction
(Doyle, 2001).
Psychological pricing - is the price designed to have a positive psychological impact. For
example, selling a product at 3.95or 3.99, rather than 4.00, and is commonly used be big
retailers. It is used as a surrogate to indicate the product quality or respect.
Geographical pricing - is different types of pricing at different locations and could be in
terms of barter, countertrade and foreign currency.
Price skimming - helps in segmenting the market. The price can be lowered to suit each
segment and thereby the demand of each segment is satisfied and the manufacturer makes
maximum profit from each of them. The high price of the product brings huge benefits for the
dealers as well.
The setting of the correct price is of enormous important as it is paid by the consumer,
examines the economic determinants of price levels, looks at how organizations make
decisions about what to charge, surveys the battleground for price wars, and explains why it
is necessary for marketers to have a good understanding of company finance(Jobber,2007).

A.C.3.4 Illustrate how promotional activities is integrated to achieve marketing

objectives.
Promotion is the activity of informing, persuading and influencing the consumers purchase
decisions. There are four main tools of promotion activities: (1) advertising, (2) sales
promotion, (3) publicity and (4) personal selling (Mintzberg, 1998).
Advertisements can be effective, but expensive and have to make sure that the target
audiences are identified. The costs can vary according to the medium and level of exposure
and can include: radio programs, local, state international or national newspapers, newspaper
supplement (e.g. education news) trade journal or magazines, industry newsletter. If you are
opening a new store or introducing a new product, you must build consumer awareness of
your existence. Promotion of a new store(s) or products, which are early in their product
lifecycle, should be geared toward providing information. Promotion budgets for upcoming
Elena Ramona Botez

Page 16

Marketing Principle

Nelson College 15/04/2013

periods are decided according to the sales objectives and a promotion budget is set ,which
Sales Promotions are short-term incentives to encourage sales of a product or service to
persuade members of a target market to respond or undertake certain activity. Promotions
include samples, rebates, contests, demonstrations and coupons, As a reward, marketers offer
something of value to those responding generally in the form of lower cost of ownership for a
purchased product (e.g., lower purchase price, money back) or the inclusion of additional
value-added material (e.g., something more for the same price).Sales promotions are often
confused with advertising Trade promotions which are an excellent means to show
your product, meet new buyers, learn more about the competition, and monitor changes in
your industry. (Cutlip , 2006)
Publicity/Public Relations - Harlow (1976) defines public relations (PR) practice as the
distinctive management function which helps establish and maintain mutual lines of
communications, understanding, acceptance and cooperation between an organisation and its
publics. Other than managing problems or issues, PR helps management to be informed and
responsive to public opinion and could help to dramatize a company or a product. In order to
do so, PR uses tactical communication activities research as its principal utensils; however,
most publicity is gleaned through news releases, feature stories and editorial comments. To
obtain this exposure for your business, it can be helpful to research effective
campaigns/events of others in a related industry (Keegan, 1979).
Personal Selling is one of the oldest forms of promotion. It involves the use of a sales force
to support a push strategy or a pull strategy and this type of promotion involves a direct, faceto-face relationship with the customer, explaining the product or service, in an attempt to
persuade the customer to buy. The steps of personal selling required varies from product to
product and is particularly applicable when the will allow the desired sales level to be met.

A.C.3.5. Analyze the additional elements of the extended marketing mix.

Booms and Bitner(2003), suggested 3 additional Ps to the traditional marketing mix, to
ensure service marketing receives the attention it deserve.
People - An extremely important part of any company is having the right people to support
the companys products and/or service and those could be sales reps, customer services
maintenance and after sale care. Excellent customer service personnel who can provide
support with clearly known expectations, such as hours of operation and average response
Elena Ramona Botez

Page 17

Marketing Principle

Nelson College 15/04/2013

time, is key to maintaining a high level of customer satisfaction. For example: banking sector
where customers comes into direct contact with the employees. Therefore these employees
need to be properly selected and trained. Knowledge able staff adds much value to the
product offering (Lindley, 2007).
Process - Solid procedures and policies that are in place, which pertains to the companys
products and/or service, is an extremely valuable element to the marketing strategy.
Customers usually want to understand more than just your product; they also want to focus
on the shape and form your business will take, as they can only see the quality of the service
being provided to him and the surrounding environment, and not the process involved in
delivering the services.
Physical evidence/packaging - This refers to the way your product, service, and everything
about your company, appears from the outside. Decisions need to be made about the size,
shape, color, material, UPC barcode, and label of the packaging. This should be customer
tested and updated when needed. It should fall in line with your other product offerings as
well. Packaging also involves the visual layout, practical setup, and when needed for
products, clear and precise installation instructions. Product liability insurance is needed in
case anyone suffers any harm from your product. Engineering tests are also needed to make
sure the package can stand up to abuses. For example: DHL courier service have the feature
of speed, delivers to any corner in the world in 24h, gives confident identity image of the firm
and also differentiates their service from the other courier service provider(Pettit,2007).

A.C.4.1. Plan marketing mix for two different segments in consumer markets
A business needs to create a successful mix when marketing its products. The marketing mix
should include:
Promotion- this consists of its visual appearance, including packaging and how well it works.
Price - this price must be set at the right level to suit the segment of the market it is

aimed

at, but it also must be able to compete with its competitors.

Promotion this should be done in such a way so that is target market is aware of its
existence and form where it is available from.
Place the product needs to be in the right place at the right time, where customers can see
Elena Ramona Botez

Page 18

Marketing Principle

Nelson College 15/04/2013

and access easily. It should be in a place that the customer will expect to find it (Hooley,
1998).
By implementing the marketing mix successfully a business can have sometimes a product
that fits into the marketing mix, but for two different segments of the market.
Bellow is a table showing an example of this for Johnsons Wipes, which are the same
product, but they are marked at two different segments, one is for babies the other for ladies
faces.
Headings
Product

Price
Promotion

Baby wipes
Wipes are larger

Face wipes
Wipes are smaller

Packaging has a picture of a

Packaging has a picture of a

baby on it and is very

lady on it and is plain in

colorful

coloring

List all the benefits to babies

Lists the benefits and uses to

skin and eyes

a womans face

1.85 for 64 wipes

Leaflets inside other baby

2.20 for 25 wipes

Beauty magazines

products

Evening TV adverts

Free sample in baby bounty

Free samples with baby

packs

wipes and in magazines

Adverts on baby magazine or

TV during the day and on
childrens channels or
Place

between womens programs

Chemists and supermarkets

Chemist and supermarkets in

within baby

beauty/hygiene

departments/aisles

departments/aisles

Baby shops

Next to other beauty/hygiene

Often found next to nappies

products.

Table1. Author
AC 4.2 Illustrate differences in marketing products and services to business rather than
consumers.
Elena Ramona Botez

Page 19

Marketing Principle

Nelson College 15/04/2013

Business marketing is the observe of marketing the products or services to the different
companies, to resell the products or services, use the products in combination with their own
used products in their business process and to facilitate the operations of their enterprises.
Consumer marketing is marketing directed toward the consumer, or the individual end their
users. The basics of both the types of marketing are basically the same, but the issues faced
can be different and all marketers select target markets and base their marketing decisions,
such as type of promotion, price and distribution based on those target markets. But the
nature of business purchase is influenced by several professional buyers, decision makers
(Kotler, 2008).
Business marketing vs. consumer marketing
While on the surface the differences between business and consumer marketing may seem
obvious is more subtle distinctions between the two with substantial ramifications. Dwyer
and Tanner (2006) note that business marketing generally entails shorter and more direct
channels of distribution. While consumer marketing is meant at large groups through mass
retailers and media, the negotiation process between the buyer and seller is more personal in
business marketing. According to Hutt and Speh (2004), most business marketers commit
only a small part of their promotional budgets to advertising, and that is usually through
direct maill efforts and trade journals. Though that advertising is limited, it frequently helps
the business marketer set up successful sales calls. Marketing to a business trying to make a
profit (business-to-business marketing) as opposed to an individual for personal use
(Business-to-Consumer or B2C marketing) is similar in terms of the fundamental principles
of marketing. InB2C,B2BandB2G marketing situations, the marketer must always:
effectively identify the product or service strengths with the needs of a definable target
market;
price and position to arrange in a line with the product or service and its market, often an
complex balance
communicate and sell it in the fashion that demonstrates its value effectively to the target
market and the potential for one(Oliver,1995).

A.C.4.3 Show how and why international marketing differs from domestic marketing.

Elena Ramona Botez

Page 20

Marketing Principle

Nelson College 15/04/2013

International Marketing can be defined as exchange of goods and services between different
national markets involving buyers and sellers. According to the American Marketing
Association, International Marketing is the multi-national process of planning and executing
the conception, prices, promotion and distribution of ideal goods and services to create
exchanges that satisfy the individual and organizational objectives.
Domestic Marketing: Domestic Marketing is concerned with marketing practices within the
marketers home country(Gronroos,2007).
Difference between International and Domestic Marketing

Meaning

International market
It refers to those activities

Domestic market
It refers to those activities

which results into transfers of which results into transfers of

Barriers

Currencies

Government

Culture

goods and services from one

goods and services inside the

country to another.
International trade is

country itself
Domestic marketing has no

characteristics by tariff and

such restrictions.

non tariff barriers

It involves exchange on the

It involves exchange in the

basis of different currencies

basis of same currencies, so

and different rates

Need to research law and

no exchange rate problems

Aware of law and regulations

regulations

Government in interference

Documentation that is

is zero or minimum only

required may not be so easily

incase of essential

obtained.

commodities.

Trade should be done taking

Culture does not affect in

diverse into consideration.

domestic marketing

Even things like colour

combination can be affect the
Mode of Payment

trade marketing.
Letter of credit is normally as .Cash, Cheques, DDs are the

Mobility of Factors of

mode of payment
Factors of Production are

most common
Domestic Trade enjoys

Production

relatively immobile as

greater mobility in factors of

Elena Ramona Botez

Page 21

Marketing Principle

Competition

Risk

Nelson College 15/04/2013

compared to domestic

production

marketing
International Trade is subject

Competition is not as intense

to intense competition

as it is in international

.International Marketing is
subject to high risk. Political,

marketing
Domestic Marketing is also
subject to risk but not as high
as international marketing.

foreign exchange risk, bad

debt risk are few of them.

Table 2. Author

Bibliography
Baker M. The Marketing Book, 5th Edition - 2003
Brassington F and Pettitt S Essentials of Marketing 2nd Edition (FT/PrenticeHall, 2007)
Elena Ramona Botez

Page 22

Marketing Principle

Nelson College 15/04/2013

David Jobber, Principles and Practice of Marketing, 5th edition, McGraw HillCompanies,
London 2007.
Doyle P, 2002 Marketing management and Strategy , 3rd edition, Prentice Hall London
Floyd L.V. Marketing: Functions, Mediums, Practices, Variations and Appraisal -1942
Gronroos C.- Service Management and Marketing: Customer Management In Service
Competition , 3rd Edition, 2007
Hooley, G. J., Saunders, J. A. and Piercy, N.F., 1998. Marketing Strategy -1942and
Competitive positioning. 2nded. London
Keegan W J, 1989, Global Marketing Management, Prentice Hall, New Jersey
King, J.B (2005) The Top 10 Reasons Business Succeed Ezine Articles
Kotler, P. and Armstrong, G. (1997) Marketing An Introduction. Fourth Edition. New Jersey.
Prentince Hall International
Kotler, P., Armstrong, G., Saunders, J. and Wong, V. (1999) Principles of Marketing, 2nd
Edition, New Jersey: Prentice Hall
Michael D. Hutt, Thomas W. Speh- Industrial Marketing Management -1981
Macmillan Doyle, 2001. Marketing Management and Strategy. 3rded. London
Mintzberg H, Business and Economic, Pearson Edition-2009
M. J., 2000. Marketing Strategy and Management. 3rdEd.Basing
Gordon Oliver- Marketing Today, Prentice Hall PTR-1995
Pettit S. Principles of marketing, 3rd edition(FT/Prentice Hall, 2003).
Tony Lindley, Marketing Management, Bradford Study Guide, Dubai, U.A.E. 2007 Vinod
A, 2004. Marketing Management. Calicut University

Websites
http://marketingteacher.com/lesson-store/lesson-marketing-mix.html
Elena Ramona Botez

Page 23

Marketing Principle

Nelson College 15/04/2013

www.managementfunda.com
www.tatamotors.com/our_world/profile.php

www.businessteacher.org.uk/market-segmentation

Journals
Journal of Marketing Education (Spring 1997).
Journal of Database Marketing and Customer Strategy Management 2001

Elena Ramona Botez

Page 24