Introduction to Marketing Principles
A firm has 1 goal, to identify the needs and wants of the market and then develops products or services to fulfill those needs. There is a complete process behind this and that is Situation Analysis, marketing strategy, Marketing mix decision and last implementation and control. These all 4 factors complete marketing process. Here in this report a giant firm Ben Sherman is taken as an example and its complete marketing process has been explained and at the end various differences between domestic and international marketing are discussed (Brooks and Simkin, 2012).
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1.1Explain the various elements of the marketing process
A company always has one goal and that is to identify what the customer wants and then to develop and deliver the products according to their needs. Marketing process starts with the situation analysis, in this firm do the complete analysis of the internal and external environment and finds the opportunities to satisfy the needs of the customers. Next is Marketing Strategy, in this a firm start developing the plans to fulfill the needs the customer. Company focuses on Segmentation, Targeting & Positioning (Cass and Julian, 2003). Third stage is Marketing Mix, here company take the decisions regarding price, pace, promotion and product. Last stage is Implementation and Control, in this the company tries to take feedback for the launched product and monitor it closely. Ben Sherman is a Global lifestyle brand and it has a business in more than 35 countries. Some of the elements that company uses are-
SWOT Analysis- It is one of the best planning method which is used to evaluate the strength, weakness, opportunities and threats of the company. It can be carried out for a product, place, industry or person. It identifies the internal and external factors which are favorable or unfavorable for the company.
Market Opportunities- Market opportunity means sizing forecast for a specific product or a service, now and for the distant future. For this company must be able to identify who its potential customers are, specific needs to be met, etc.
Integrated Marketing- It is a marketing strategy that focuses on the importance of a consistent, multidimensional brand experience for the consumer (Chikweche and Fletcher, 2012). Each branding effort is presented in similar way which reinforces the bra1000 nd ultimate message.
Target Market- It is the specific group of people, to which company wants to sell the product. They are selected by the way of the segmentation.
1.2: Evaluate the benefits and costs of a marketing orientation for a selected organization
Market orientation helps the company to meet the needs and wants of customers in all parts of its operation. Companies try to develop such products which attract more and more customer towards it (Eid and Trueman, 2002).
Marketing Orientation in Ben Sherman- Ben Sherman has effectively used market orientation technique in its operation and they have tried to become more customers centric. The company has regularly introduced new products according to the changing generation and created many opportunities to grow. Company offers various brands in clothing, watches, footwear’s, etc. The company has developed its structure as, if any new trends come in the market then they can quickly developed their product according to it (Esopo and Almquist, 2007). They are also giving contracts to various private marketing firms and spending lots of money to market the company. But from past few years, the company is engaged in too much innovation that it has forgotten their main motto, which is to develop the product according to demand to public. But still they have very strong foundations and they can still overcome these weaknesses and can become strong brand.
Customer Retention- Market orientation has helped the company to understand the customer in a much effective way. They are doing various efforts to retain the customers like offering various discounts, changing the trends according to them, club card fascilities. The company is also making various efforts to collect feedbacks from the customers so that they can understand their loopholes
Customer Profitability- Company is making great revenues from their clothing range and other mid range products. The prices of the products are not high but the quality they offer is much better than the competitors so many people are their loyal customers. They also have a huge product line for each segment.
Relationship Marketing- Company is making relations with people by regularly collecting their feedbacks, clubcard fascilities which allow them some extra benefits and other activities like exhibitions, direct mail, etc.
2.1 Show macro and micro environmental factors which influence marketing decisions
Macro and micro environment is the external environment which affects the firm and they have no control over it. The company can become successful if they successfully adapt to this environment (Martin, 2009). Macro environment of Ben Sherman includes various factors and they indirectly influence the marketing decisions of the company.
Macro environment- Major external and uncontrollable factors that influence the organizations decision making and affect the working of company in terms of its performance and strategies. These factors include economic, social, political factors, etc.
We can do the analysis by PESTLE approach to determine the external factors.
Political- Various Government policies, their interruptions and different types of tariff has affected their operations in a huge way.
Environmental- People are now moving towards more environmental friendly products and this has hugely affected the demand patterns among people and it has give Ben Sherman new opportunities.
Economical- The recent economic crisis has affected the in poor sales and more unemployed staff (Melewar and Saunders, 2000).
Social- Recent changes in social trends have affected the company’s products. The demands of the people are changing continuously according to social culture.
Technological- Company is using various technologies like internet, social media platforms. This has helped the company in targeting more people with greater innovation and quality and as a result company is improving its market share (Mesdag, 2000).
Legal- There has been some changes like disability discrimination legislations, minimum, wage, recycling; etc has affected the firm behavior in a big way.
Now comes the micro environment which determines the company’s inability to produce and serve the market. One of the ways of doing it is Porter 5 forces model which finds out the companies strength and weaknesses in the industry by 5 competitive forces. We can apply this on Ben Sherman too (Till and Nowak, 2000).
Power of Suppliers- This tells how the suppliers affect the firm. There are many suppliers from Asian countries and European country. Ben Sherman can try to make partnerships with them to reduce the price of its products.
Power of Buyers- Buyers usually demand good product at low price. Company always has pressure to work cost effectively so that prices of products could be low. Ben Sherman can try to increase the customer loyalty by various methods (Wise and Sirohi, 2005).
Threat of new entrants- Every day new companies are coming in the industry with better options to serve customers. Ben Sherman has to maintain its market share to work properly.
Threat of substitute product- Many companies are innovating new products and this is a big threat to Ben Sherman (Converse, 2008).
Industry Rivalry- There are many competitors of Ben Sherman like Diesel, Ted Baker, etc. Company can avoid competition by product differentiation or by reducing price of products.
2.2 Propose segmentation criteria to be used for products in different markets
Segmentation means to divide the market into different groups according to their age, gender, class, behavior, geographic regions, etc. There are many types of segmentation like Demographic, Geographic, Behavioral, and Psychographic.
Geographic Segmentation- Companies segment the market according to the particular geographical area.
Demographic Segmentation- In this the market is divided into groups according to income, gender, social class and lifestyle of people and company take action according to it.
Psychographic Segmentation- It is based upon multivariate analysis of the customer attitudes, perception, beliefs, and interest. It is very difficult way of segmentation.
Behavioral Segmentation- Company identifies the specific behavioral patterns of consumer group, enabling them to know their customers better and to target them more precisely.
If we see Ben Sherman then we will find that company is mainly using the demographic criteria to develop its products. In Demographic the market is divided into groups according to income, gender, social class and lifestyle. Ben Sherman has different products according to these criteria. Company has always tried to make to make products for the middle class group but they also have some high quality products for the people with great social class. Company has products for both males and females and their products are mostly for adults like businessman/women, college going students, etc. Company has different brands in clothing, shoes, watches, etc and for each market they are trying to provide products based on above segmentation (Dalgic, 2006).
2.3 Choose a targeting strategy for a selected product/service
Targeting means to select a particular segment and target them with the product or service. There are different types of targeting strategies which are-
Undifferentiated Marketing- In this company does not segment the market; they use their marketing techniques for whole group of customers. It is also called mass marketing.
Concentrated Niche Marketing- It means, targeting a small area in the market, which is unique and different.
Differentiated Marketing- It means targeting each segment with different marketing strategies and offers.
Ben Sherman has different types of product from clothes to footwear’s and they target many users according to their different wants and demands. It the company’s watch market it has huge opportunity and they can capture a good market share. Ben Sherman watches are very classy and are made generally for the business class. Company can follow niche concentrated marketing for this product. Their main aim is sell watches to high income group generally the business class like VP, CEO, etc (Bowie and Buttle, 2013). They can make agreements with various corporate houses to sell this product. It will help them to create a brand identity and will also improve their image. Through this niche targeting they can easily focus on this particular segment and can cover the large market share. Company can also target these people directly, which will help them to explain the product in detail and will benefit them in business (Kotler, 2010).
2.4 Demonstrate how buyer behavior affects marketing activities in different buying situations
Any business which is operating locally or internationally, it is always affected by the buying behavior of the people. Customer is the king of the market; he can take company to a great success or can also close the business. It is very important for Ben Sherman to understand the buying behavior. Company has a huge clothing line, and the main target of the company is to target the people with middle class. People in this class are very choosy. They demand high quality products with low prices. If the company will increase the prices in clothing category then these people will easily shift to other company, so company use various techniques to attract the people in this market (Varey, 2002).
Another product of the company is watches and their main target area is the business class people which have high income. Company is following niche marketing for this people. People in this group are very intelligent and knowledge, so company has to take their steps very carefully to maintain the brand image. The prices of the product are very high because if the prices are low then these people will not purchase the product as it will not suit their class.
We can use Rational Decision Making Process which says that first the consumer recognize the problem or need. They try to find what they want to satisfy them. Then after this consumer search about the thing he want in the market. In this he finds different types of alternatives which can satisfy his needs, so he compare all the products to find the best one. Then he purchase the selected product and provide feedbacks after using that.
2.5 Propose new positioning for a selected product/service
Positioning is company’s effort to change the consumer perception about a brand or a product relating to the perception of competing brands or product. If we see Ben Sherman, they have huge range of women’s bag collection, which they have targeted to middle class women. In this category there are many competitors to the company who are selling same products with the one or the other unique quality or no unique quality. The market is very scattered in this category and company is only able to make break even profit. To capture the large market share and to earn huge revenues in this category company has to follow Competitive Positioning Strategy. This strategy means to differentiate the products offer and create value in the market. To achieve this company has to do great market research and then they have to create the products which are unique in terms of quality, price or innovation then the competitor’s product. Company should first understand the complete demand of the consumer and then should start offering products to fulfill those demands. By this way company can position itself different from others and can capture the huge market share (Rinas, 2007).
3.1 Explain how products are developed to sustain competitive advantage
Competitive advantage is very necessary for any business for its success. Competitive advantages are strength of the company which differentiates it from the rest of the competitors. There are different ways in which company can sustain competitiveness, which are price, uniqueness and service. Price plays a very important role in the market as there are many people who are price consciousness and their demands are not fulfilled then they can easily switch over to the competitors. If we see Ben Sherman product category, they have gained a huge success in the clothing segment. They develop clothes for the middle income group and fulfill their all needs. This is the product which has given them huge competitive advantage. They are continuously making the product which is unique from the products of other companies as they are providing high quality in very competitive price. Their mode of deliver is also very convenient as they have their online store and they have also made contract with third party websites to sell products (Marshment, 2009). People can easily go online and can purchase the product by choosing among different varieties. Ben Sherman has done lots of research to develop product according to the needs of people and still now they are making continuous efforts to evolve their product according to changing trend.
3.2 Explain how distribution is arranged to provide customer convenience
Distribution is one of the main components of the marketing mix. It means to distribute the products to the customers by the direct or the indirect means. Distribution helps the company in it selling the product. Companies should understand that, even if their product is good but the people are not able to get that easily then they will not be successful in the market. Ben Sherman the one company who has all of these factors in its distribution. They know that making products available to customers is very important and that’s why they are very successful and earning huge revenues. Company has maintained a good control over the distribution of its products. They make sure that their products are sold according t their standards and for this, they have many exclusive stores to sell their products. They have also made contracts with other fashion stores to sell their product but they regularly check the services of these stores. To make shopping more convenient, they also have online store, where consumer can easily purchase their products from home and can get a quick delivery (Ali and Talvar, 2013).
3.3 Explain how prices are set to reflect an organization’s objectives and market conditions
Prices are very important element of any business; it can destroy the company or can take it to huge success. Keeping the right price for the product is very difficult task for any company because they have to make sure that the prices are suiting to the target market and also the company is able to earn revenue. In case of Ben Sherman, they are successfully enjoying the cost based pricing and it is giving them huge profits. They also use market oriented price penetration technique, where the price of the product is kept low when it is launched to attract the new customers. Other than these two strategies the company product pricing is also related to perceived value. The company successfully evaluates each segment and then set the price according to the psychology of the people. The company makes pricing strategies by matching medium price range brands with great quality.
3.4 Illustrate how promotional activity is integrated to achieve marketing objectives
Promotional activities are very important for any business to sell its products. Without proper marketing company will never be able to make its brand identity. Ben Sherman uses different marketing strategies to promote its products. Basically there are 4 tools of marketing, which are publicity, sales campaign, personal selling and advertising. Ben Sherman is using all of these very effectively. To promote its product Ben Sherman use various above the line marketing mediums like, news papers, magazines, Televisions, etc Company has no control over these mediums and they are very costly also but the main advantage is that, this marketing techniques help to reach the customer in a very short time and covers large area. They also use various below the line techniques like exhibitions, direct mail, etc where they make direct contact with the customers. This helps them to understand the customer in a better way. Other than these, company is also very active on social media platforms and offers huge discounts to the customers. They also have their website, where they regularly update the product category and offers new advantages with each product.
3.5 Analyze the additional elements of the extended marketing mix
Other than price, promotion, place and product there are there more elements of marketing which are equally important for the success of the company and these are people, physical evidence and process management. Physical evidence is the environment which company provides to its customers while shopping. Ben Sherman has always tried to maintain the standards of their stores by providing good ambience, fascilities and the layout of store, etc. Process means how the product is made according to the needs of the customer. Ben Sherman has always tried to follow the good processing of its product so that they can deliver the product exactly the customer wants it. Last is people, which says how effective are the people working in your company. Company provides regular training to its employees so that they can work in more efficient way and also there are good incentive schemes by company to motivate employees.
4.1 Plan marketing mixes for two different segments in consumer markets
Ben Sherman Clothing Range Marketing Mix
Product- This product is made according to the needs of the customer. They use both market oriented and product oriented techniques. They have a wide range of clothing from kids to adults.
Price- In clothing range the pricing of the product is very mid range because their target is middle class families. They also target the customers with various discounts and offers.
Place- Company has various showrooms to sell their clothing product and they have also made tie-ups with different independent stores to sell product. Other than stores, company also sell product online on their website.
Promotion- Company uses various above the line techniques such as TV, Radio, etc. to target and reach the customer at same time.
Ben Sherman Watch.
Product- This product is made by keeping in mind the needs of business class and high society people.
Price- The price of this product is very high according to the class of the people.
Place- This product is sold in exclusive showroom of the company by giving various other fascilities.
Promotion- To promote this product, company use below the line activities like direct mail, calls, etc to make personal relations with the clients and to serve better.
4.2 Illustrate differences in marketing products and services to businesses rather than consumers
There is slight difference between selling product to business and selling products to customer. While selling products to business, company has to focus on the features of the product as the people they are selling are very professional and they will only purchase when there is something unique in the product. There are no emotions involved in this category and all the things are done professionally. While selling to customers the main focus is given on the benefits of the product. Ben Sherman deals in business to customer category as there is no other person involved in selling. The company provides various offers and discounts to attract people and there are lots of emotions involved in this business. Customers demand great service and convenient shopping and they focus more on benefits rather than marketing.
4.3 Show how and why international marketing differs from domestic marketing
Domestic and International Marketing are very different from each other. International marketing means those activities which results into transfer of services, products from 1 country to other whereas domestic marketing means to sell the goods within the country. In international marketing there are various trade barriers and company has to follow them and also there is an exchange of currency whereas there is no such thing like this in domestic marketing. In international marketing company has to adapt the culture and tradition of the local market and also there is lots of competition. Ben Sherman has been able to do its international marketing successfully. They have always tried to follow all the rules and regulations and they also adapt very quickly as per the need of the country.
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In the above report we have discussed various marketing principles which Ben Sherman is using. We can see that all these principles are very important for the success of any business and Ben Sherman is using them very effectively. Using all these, company has been able to get a good market share in both domestic and international market and has positioned itself very differently from the rest of the competitors.
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