MARKETING

1. Learning outcomes: Define the Marketing Concept Identify stages of marketing planning Understand and apply Porter’s Five Forces Model Define consumer buyer behaviour MARKETING

2. choosing and targeting appropriate customers positioning your offering interacting with those customers controlling the marketing effort continuity of performance The marketing concept

3. Marketing audit – SWOT & PESTLE & Porter’s 5 Forces Model Setting marketing objectives Describe target market Marketing tactics – 4/7P’s Marketing controls Stages in Marketing plans

4. Read the case study regarding Tesco then complete a PESTLE analysis of the company. Pestle activity

5. Ability of firms to be profitable depends of five forces: The threat of new entrants to the industry Bargaining power of suppliers Bargaining power of customers Threat of substitute products Degree of competitive rivalry Porter’s five forces

6. Five forces framework

7. New entrants take market share = less profits Barriers to entry including: • Capital costs of entry • Ease of access to distribution channels • Regulatory and legal restrictions • Existing product differentiation e.g champagne • Retaliation by established products Threat of new entrants

8. Easy to enter if there is Difficult to enter if there is • Common technology • Access to distribution channels • Low capital requirements • Low scale thresholds • Absence of strong brands and customer loyalty • Patented or proprietary know how • Difficult in brand switching • Restricted distribution channels • High capital requirements • High scale threshold

9. Suppliers are powerful when: There are only a few large suppliers The resource they supply is scarce The cost of switching to another is high Products are easy to distinguish and customers reluctant to switch No substitute resources available Bargaining power of suppliers

10. There is only a small number of them If buyer purchases a significant proportion of output They possess a credible integration threat i.e. they threaten to buy the producing firm or its rivals They find is easy and cheap to switch suppliers Buyers are strong if

11. Level of threat depends on: Extent the substitute can match the product in price and performance Willingness of buyers to switch Switching costs Customer loyalty Threat of substitute products

12. Degree of rivalry is determined by: Number of competitors in the market Market size and potential growth prospects Product differentiation and brand loyalty Power of buyers and availability of substitutes Cost structure of the industry Exit barriers i.e. Difficult or expensive Degree of rivalry

13. Using the Tesco case study from before complete a Five Forces analysis with explanations 20 mins Five forces activity

14. Definition of Buying Behavior: Buying Behavior is the decision processes and acts of people involved in buying and using products. Need to understand: why consumers make the purchases that they make? what factors influence consumer purchases? the changing factors in our society. Consumer buyer behaviour

15. Buyer behaviour stages

16. Motivation of behaviour

17. Describe the buying decision process for a mobile/smartphone covering the following stages: Recognition of a need. Choice of level of involvement (i.e. justifying you time and effort e.g. low for bubble gum, high for a holiday). Identification of alternatives. Make decision. Action. Post-purchase behaviour i.e. did it meet your expectations? Did you use it? Was it reliable? Etc. Buying decision activity

18. Recognition of a need - to communicate with friends, as a fashion item. Choice of level of involvement (i.e. justifying you time and effort e.g. low for bubble gum, high for a holiday). Medium level of involvement to justify cost and coverage of telephone. Identification of alternatives. Which companies are offering the most suitable packages? ABC inc. or XYZ inc.? Make decision. Go with service XYZ inc. Action - Buy phone from store. Post-purchase behaviour i.e. Did it work? What was the telephone bill? Did you friends like it? activity