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1 HMMA: Implement and Monitor Marketing Activities Student Guide BSBMKG514A: Implement and Monitor Marketing Activities Elements of competence Implement marketing strategies and tactics Monitor marketing strategies and tactics Evaluate and improve marketing performance BSB51107 Diploma of Management _____________________________________________________________________________________________ HIMMA Implement and Monitor Marketing Activities Student Guide v 2.0 August 2010 Page 2 MODULE DESCRIPTION The module provides an introduction to the Fundamentals of marketing through implementing and monitoring marketing activities, touching also on the need to develop product knowledge. It builds on the basic elements of marketing by first defining ‘what is marketing’ and how it relates to all marketing activities, primarily the marketing mix This module also covers the evolution of the importance of product knowledge and how the customer has demanded to know more about products and services as their choice between brands has increased over years. LEARNING OUTCOMES Upon successful completion of this unit, students should be able to understand the key elements in the fundamentals of marketing and how to apply them in evaluating marketing opportunities, implementing and monitoring marketing activities together with understanding the importance of product knowledge in monitoring marketing activities. TEACHING PROGRAM Forty (40) hours duration. Eight (8) hours per week for one teaching block of five (5) weeks. Each week will consist of six (6) hours of lectures and two (2) hours of tutorials COURSE REQUIREMENTS To be assessed as competent for this unit of competency you must be able to do the following: (1) Demonstrate understanding of all learning outcomes (2) Successfully complete and submit all tasks as requested Assessment methods and tasks Methods of assessment Through consultation with industry, the following assessment methods have been deemed appropriate for this unit. Project work Demonstration of the skills and knowledge to implement and monitor marketing activities. Written report Demonstrates skills and knowledge to report on implementing, monitoring and evaluating strategies and tactics to improve marketing performance. Presentation Presentation of report on the monitoring of marketing strategies and tactics. BSB51107 Diploma of Management _____________________________________________________________________________________________ HIMMA Implement and Monitor Marketing Activities Student Guide v 2.0 August 2010 Page 3 ASSESSMENT DETAILS Assessment Due Assessment Task 1 Implement Marketing Strategies and Tactics & Evaluate and Improve Marketing Performance– written report Week 3 Assessment Task 2 Monitor Marketing Strategies and Tactics Week 5 Assessment Task 1: Implement marketing strategies and tactics Submission details Candidate’s Name Phone No. Assessor’s Name Phone No. Assessment Site Assessment Date/s Time/s The Assessment Task is due on the date specified by your assessor. Any variations to this arrangement must be approved in writing by your assessor. Submit this document with any required evidence attached. See specifications below for details. Performance objective The candidate must demonstrate ability, knowledge and skills to identify, prioritise and implement marketing strategies and tactics. Brief assessor on the plan. Set communication and team building strategies. Implement strategies to monitor marketing activities and analyse marketing performance. Assessment description The candidate is to write a two to three page report that reviews the actual, or possible implementation strategies and tactics for an organisation for which they can access or determine a marketing plan. The report should cover the following aspects of implementing marketing strategies and tactics: Brief stakeholders and non-marketing personnel on their roles and responsibilities and performance measures; outline the marketing plan; prioritise marketing strategies; implement communication and team building strategies to ensure the personnel responsible for implementation work together; and implement strategies for monitoring marketing activities and analysing marketing performance. BSB51107 Diploma of Management _____________________________________________________________________________________________ HIMMA Implement and Monitor Marketing Activities Student Guide v 2.0 August 2010 Page 4 Procedure 1. Select a marketing plan. The candidate, with direction from their Assessor may either: a. utilise the marketing plan available at the appendix to the Student Workbook. Or: b. take advantage of an organisation with which they are familiar with, for example, a well-known company. Note: you should choose an organisation for which marketing information is easily discernable from current marketing activities or through their website, such as McDonalds. 2. Review the marketing plan to determine the strategies and tactics. 3. Prepare a two to three page report reviewing the actual, or possible, implementation of the strategy and tactics by addressing the following. a. Summarise stakeholder briefings regarding their implementation roles. b. How were marketing and non-marketing personnel briefed? i. The objectives of the plan? ii. Their roles and responsibilities in relation to the implementation of the plan? iii. Their performance measures? c. Create a prioritised list of at least three of the marketing strategies and the resources required for each strategy. d. What communication and team building strategies were used to ensure the personnel responsible for each element of the marketing mix work together to achieve the marketing objective? e. What strategies were implemented for monitoring marketing activities and analysing performance? f. What you would do differently if you had to undertake a similar project in the future and why? BSB51107 Diploma of Management _____________________________________________________________________________________________ HIMMA Implement and Monitor Marketing Activities Student Guide v 2.0 August 2010 Page 5 4. Ensure that: a. the report identified the organisation and marketing strategies that you reviewed b. the report’s content, format and level of detail meets organisational standards c. the report is delivered to set deadline (as established by the facilitator) 5. Complete this section at the end of your project. a. Describe the processes you used to regularly assess marketing performance against objectives. b. What team work skills do you think are required to manage a marketing team? c. What changes in business practices are required to meet changing customer requirements? d. Prepare a short communication for the stakeholders communicating changes to the marketing objectives and targets based on your improvement plan. Specifications You must provide a two to three page written report that: meets standard business reporting in terms of: o content o format o level of detail. Discusses the following aspects of implementing marketing strategies and tactics. BSB51107 Diploma of Management _____________________________________________________________________________________________ HIMMA Implement and Monitor Marketing Activities Student Guide v 2.0 August 2010 Page 6 o Brief stakeholders who participated in the marketing planning process on their roles and responsibilities. o Identify and brief marketing and non-marketing personnel critical to the success of the marketing plan on the objectives of the plan, performance measures and roles and responsibilities. o Prioritise marketing strategies and identify resources required for their implementation, in accordance with organisational requirements. o Implement communication and team building strategies to ensure that personnel responsible for each element of the marketing mix work together to meet the organisation’s marketing objectives. o Implement strategies for monitoring marketing activities and analysing marketing performance in accordance with the marketing plan. Your assessor will be looking for evidence of: reporting on marketi
ng activities against defined objectives culturally appropriate communication skills to relate to people from diverse backgrounds and people with diverse abilities literacy skills to prepare reports on marketing activity knowledge of: o organisational strategic and marketing objectives, plan and performance measures o principles of marketing mix o key provisions of relevant legislation from all forms of government, codes of practice and national standards that may affect aspects of business operations, such as: i. anti-discrimination legislation and principles of equal opportunity, equity , and diversity ii. ethical principles iii. marketing codes of practice and conduct such as the Australian Direct Marketing Association (ADMA) Direct Marketing Code of Practice iv. privacy laws v. Trade Practices Act. BSB51107 Diploma of Management _____________________________________________________________________________________________ HIMMA Implement and Monitor Marketing Activities Student Guide v 2.0 August 2010 Page 7 Assessment Task 2: Monitor marketing strategies and tactics Submission details Candidate’s Name Phone No. Assessor’s Name Phone No. Assessment Site Assessment Date/s Time/s The Assessment Task is due on the date specified by your assessor. Any variations to this arrangement must be approved in writing by your assessor. Submit this document with any required evidence attached. See specifications below for details. Performance objective The candidate must demonstrate ability, knowledge and skills to monitor marketing strategies and tactics. Implement and monitor promotional activities, product, pricing and distribution decisions, marketing results and marketing revenue and costs. Analyse costs against budget and record variations. Prepare and present reports that indicate marketing progress against marketing objectives. Assessment description The candidate is to prepare a one to two page report and a presentation on the progress of marketing plan activities for an organisation for which they can access sufficient marketing data. The organisation may be one with which they are familiar, for example, their own workplace, or another as negotiated with the facilitator. The report and presentation should address the progress of marketing activities against objectives, plan and targets, including an analysis of revenue and costs against budget. Procedure 1. A collection of data that relates to the Marketing Plan in the Appendix of this assessment. Your Assessor will advise you on the options to be taken in this assessment: Use the data supplied in the Appendix to this assessment and the Marketing Plan in the Student Workbook. 2. Prepare a one to two page project update report that outlines the current progress of the marketing activities against the marketing plan and overall objectives. Your report should comment on the strategies and tactics being used to: a. monitor and implement the promotional activities BSB51107 Diploma of Management _____________________________________________________________________________________________ HIMMA Implement and Monitor Marketing Activities Student Guide v 2.0 August 2010 Page 8 b. monitor product, pricing and distribution decisions c. monitor marketing results against targets in the Marketing Plan d. monitor marketing revenue and costs against budget e. record variations in revenue and costs against budget. 3. Prepare a ten minute presentation based on your report. 4. Ensure that: a. the report’s content, format and level of details meet organisational standards for an internal project update b. the presentation’s content, format and level of detail meets organisational standards c. the presentation is delivered to set deadline (as established by the facilitator). Specifications You must provide a one to two page report that: meets standard internal project reporting in terms of: o content o format o level of detail. indicates ongoing progress towards marketing objectives is delivered on time, (as set by the facilitator). BSB51107 Diploma of Management _____________________________________________________________________________________________ HIMMA Implement and Monitor Marketing Activities Student Guide v 2.0 August 2010 Page 9 You must deliver a presentation that: meets standard presentation guidelines in terms of: o structure o professional delivery o inclusion of visual aids. is no less than ten minutes clearly outline the key points in your report presents ongoing progress towards the organisation achieving marketing objectives is delivered on time, (as set by the facilitator). Your assessor will be looking for evidence of: monitoring, evaluating and reporting on marketing activities against defined objectives culturally appropriate communication skills to relate to people from diverse backgrounds and people with diverse abilities literacy skills to prepare complex reports on marketing performance numeracy skills to analyse marketing performance, revenue and cost knowledge of: o organisational strategic and marketing objectives, plan and performance measures o principles of marketing mix o key provisions of relevant legislation from all forms of government, codes of practice and national standards that may affect aspects of business operations such as: anti-discrimination legislation and principles of equal opportunity, equity , and diversity ethical principles marketing codes of practice and conduct such as the Australian Direct Marketing Association (ADMA) Direct Marketing Code of Practice privacy laws Trade Practices Act. BSB51107 Diploma of Management _____________________________________________________________________________________________ HIMMA Implement and Monitor Marketing Activities Student Guide v 2.0 August 2010 Page 10 Appendix 1: Case study Case study – Organisational review You are the marketing manager for a ten store chain of outdoor-lifestyle stores in Brisbane called BBQfun. The stores specialise in BBQs, outdoor furniture and BBQ consumables. The organisation is close to reaching its previously set goals and is looking to activate the next phase in the organisation’s development. The CEO has asked you to undertake an organisational review. To help you get started, the CEO provided you with the Marketing Plan for BBQfun (July 2008), the latest IBIS report for the industry and a copy of the annual report by the chair in December 2009, and a subsequent interview. You review the annual report and note the following statement by the chair of the board. “Within the next ten years BBQfun will become a national retail brand, catering to the needs of home makers with a range of unique, high quality outdoor-lifestyle products made accessible to all through our easy to manage payment plan.” At the time of the annual report the chair of the board was interviewed by a reporter who has made the recording available through their website. You watch and listen to the interview and hear the following statements by the chair of the board. “BBQfun’s values have been the same for as long as the organisation has existed. For our stakeholders it has always been about stewardship and to adhere to professional and moral standards of conduct in all that we do. For our people we are committed to encouraging self-directed teams, we cultivate leadership and we maintain high levels of safety. Externally we are committed to wise environmental practices and to offering meaningful value to our customers.” “By 2018, I see BBQfun with a significant retail presence in outdoor-lifestyle in every Australian capital city, starting with 15 stores in the greater Brisbane area and growing to 50 Australia wide” “Our market strengths continue to be our ability to source imported products that customers want at prices that customers believe represent value for them but which give the organisation the required margins and financial returns” You asked the CEO about the new phase in the strategic plan who explained that it was a big step. “We now need to change our focus from local suppliers of services to national ones and to think about opportunities to save mo
ney by getting a wider geographic benefit and choosing media with a more national reach.” When asked about the current marketing plan against actual results for the year the CEO said: “Well, we achieved our store growth and sales growth but our gross profit margins are currently sitting on 48%. I think we are still below the threshold for container buys which would give us the extra margins. So, expansion in sales is a key issue here. We spent $70,000 on radio advertising and $220,000 overall including magazines/PR and direct marketing. While this radio advertising expenditure got us the sales results, it was a significant cost that was not initially planned for. The PR has been particularly useful with many write ups given our unique offer. BSB51107 Diploma of Management _____________________________________________________________________________________________ HIMMA Implement and Monitor Marketing Activities Student Guide v 2.0 August 2010 Page 11 The customer loyalty lists had achieved a total of 17,000 and a survey by Lombard’s indicates that 70% of people in the target market recognise the BBQfun brand and what it represented. Overall our original SWOT analysis in 2008 is still a valid analysis for today. Not much has changed in that regard.” Studying the latest IBIS report for the industry you note the following differences between BBQfun’s marketing plan 2008 and the current situation. You noted that interest rates were in fact rising and that unemployment was not at 5.3%. The social trend towards house proud purchases is growing stronger than anticipated while the broadband rollout has been delayed putting on hold some of the organisation’s internet marketing plans. You also note the sales break-ups between the existing Brisbane stores and see BBQs at 40%, outdoor furniture at 35%, and BBQ consumables at 25%. The CEO explained that initially, the BBQ consumables category gains early traction with the market followed by the uptake by customers in the other categories. For this reason the CEO suggested a target of 40% for BBQ consumables items would indicate that the new markets were on track to achieve the overall sales target. Quite often a new customer’s first purchase from is in the BBQ consumables and this gives us the opportunity to sign them up for our loyalty program. Our initial advertising budget will feature these items and will be the front entrance prominent display in the initial period. The board has decided to apply the industry’s self regulating country of origin and ensure that the actual country of origin is clearly displayed on all these items. The following are some more notes from your BBQfun mid plan review. A new manufacturer overseas has been sourced due to cheaper prices. Samples and first shipment quality were good but the second shipment had a number of returns. This has presented an opportunity for a higher margin or reduced overheads with the consequence of the quality positioning in the market under review. The honouring the three year guarantee has been challenging with the lowering of quality in the new manufacturers lines. Promotions in the Brizzy magazine combined with instore entertainment has been very well patronised with a high number of leads to follow up. Joint industry-wide promotions will allow BBQfun to establish early traction in its goals for market share. REFERENCES Kotler, P., Adam, S., Brown, L. and Armstrong, G. (2005) Principles of Marketing, 3rd edition, Prentice Hall. Students are also advised to source additional information via newspapers and periodicals such as the Financial Review, business sections of newspapers such as the Age. BSB51107 Diploma of Management _____________________________________________________________________________________________ HIMMA Implement and Monitor Marketing Activities Student Guide v 2.0 August 2010 Page 12 WEEKLY SCHEDULE WEEK TOPIC 1 Introduction to Marketing The concept of product knowledge Assessments set 2 Developing the Marketing mix Adding value with features and benefits Review of assessment progress 3 Pricing Considerations Identifying marketing opportunities Practical FAB analysis Product Placement Distribution Investigating marketing opportunities Evaluating competitors Assessment Task 1 due Review of assessment progress 4 Promotions Creating competitive advantage Monitor marketing strategies The marketing plan Opportunities for improvement Involving key stakeholders such as customers and personnel Review of assessment progress 5 Assessment Task 2 due review
BSBMKG514A Implement and monitor marketing activities © 2010 Innovation and Business Industry Skills Council Ltd. The Marketing Implementation Process Marketing plan outlines overall objectives Defines strategies, tactics and actions to achieve objectives Organisations must then implement the Organisations must then implement the strategies and tactics. This involves 3 key steps Marketing implementation process © 2010 Innovation and Business Industry Skills Council Ltd. Brief stakeholders Implementing marketing planning process, defining roles and responsibilities. Stakeholders can include: M Stakeholders can include: Directors Finance staff Human resource staff IT staff Ensuring stakeholders know the planning process their roles and responsibilities… Managers Marketing personnel Production staff Supervisors © 2010 Innovation and Business Industry Skills Council Ltd. Identify and brief marketing and non‐marketing personnel Internal marketing Marketing and non‐marketing personnel Briefing information Measuring performance This is critical to the success of the marketing plan… © 2010 Innovation and Business Industry Skills Council Ltd. Balanced Scorecard 1. Customer 2. Financial 3. Internal business processes 4. Learning and growth (CI) Learning and growth (CI) Marketing strategies © 2010 Innovation and Business Industry Skills Council Ltd. Action Plans Identifies required tasks, resources and timelines Defines what needs to be achieved, by when and how Comprised of 3 major elements 1. Activity description 2. Deliverables 3. Resources needed Marketing resources Prioritise marketing strategies and identify resources for their implementation, in accordance with organisational requirements. Resources include: Financial Human IT Physical Technical © 2010 Innovation and Business Industry Skills Council Ltd. Communication and team building Implement communication and team building strategies to ensure that personnel responsible for each element element of the marketing marketing mix work together to meet the organisation’s marketing objectives. Team building and communication are essential to ensure successful outcomes… © 2010 Innovation and Business Industry Skills Council Ltd. Communication and team building Individual team members must be fully aware of: Project goals and objectives of marketing plan Individual targets and KPIS Scheduled implementation and monitoring Scheduled implementation and monitoring points to measure achieved goals and objectives Timetabled evaluation and review Five ‘C’s of effective communication articulate Clearly speak Correctly be Considerate give Compliments have Confidence. © 2010 Innovation and Business Industry Skills Council Ltd. Five ‘C’s of effective team building Clear expectations Channels of communication Conflict resolution Consequences Celebrating achievements as a team. © 2010 Innovation and Business Industry Skills Council Ltd. Week two Monitoring marketing strategies and tactics 14 Monitoring marketing activities 1. planning tools 2. monitoring and evaluation We must constantly and consistently measure to improve… 3. employee feedback 4. customer feedback. © 2010 Innovation and Business Industry Skills Council Ltd. 1.Planning Tools can use a range planning tools with action plan Flow charts Gannt charts Pert diagrams Pert diagrams Milestone charts 16 2. . Monitoring and Evaluation Assess the situation to observe any changes which may occur over time Use a monitor or measuring tools of some sort Collected data could include: Collected data could include: Number of hits on a website Inventory records to track stock Invoices to track sales Recorded queries 2. Monitoring and Evaluation Class activity – handout appendix 4 Analyse the consumer response data for the school supply shop. Discuss in small groups then to the class what Discuss in small groups then to the class what you can infer about the marketing activities of the shop How would you suggest their retailer use this information in future marketing planning? 18 3. Employee Feedback Internal feedback is essential tool for measuring to improve Brief forms circulated to employees weekly to note Customer satisfaction Events or problems needed to be addressed A record of action taken when customer is dissatisfied Summary should be circulated to all employees to inform, educate, and improve total organisation problem solving for customers 19 4. Customer Feedback Can be used to obtain information on effectiveness of marketing activities Does organisation have mechanism to obtain feedback on customer service levels? Is the mechanism timely and what is done with the feedback? 20 4.Customer Feedback Methods Survey sent to customers about how well organisation meets their needs Monthly/quarterly review with specific customers Monthly/quarterly review with specific customers to determine Summary of sales compared to previous years Current customer service issues – what they were and how and if resolved Customer service improvements summary 21 Monitor Marketing Strategies and Tactics Essential to monitor and implement promotional activity against its set communication objectives What goals and objectives are required to ensure success of camp g ai n? Start with defining the objective of the marketing communication Identify target markets perception Action target market are likely to implement upon exposure to communication 22 Communication Objectives Important to identify what target market iwll benefit from the product May include: Creating brand awareness Determining the need which the product/service will accommodate Encouraging action from the target 23 Case Study Braap 24 Braap In small groups read this case study and then discuss the following 1. what message is braap communicating to its customers? 2. how effective do you think this message is to its target audience (why) 25 The Marketing Mix To implement your marketing plan you will need to action the tactics defined in the marketing communication or marketing mix The marketing g mix communicates the message through a variety of channels Advertising Sales promotions Personal selling PR Direct marketing 26 Promotion Mix Important to identify and analyse the strengths and weakness of marketing mix components Balance must be created to ensure an interg pp rated approach which maximises return on investment 27 Advertising Far reaching, high frequency covering large, geographically dispersed audiences Relatively high cost averaged at low cost per exposure Consumer perception of advertised goods is Consumer perception of advertised goods is considered more legitimate Company and brand and brand image dramatised and/or develop Stimulates short term sales Costly 28 Personal Selling Effective for building buyers’ preferences Feedback and adjustment can be implemented from personal interaction Rapport and relationship orientated Rapport and relationship orientated Attentive buyers Long term commitment is represented by sales persons The most costly of all promotional tools 29 Sales Promotion Targets trade or end consumer Uses premiums, coupons, contests etc Incorporates worthwhile incentives, dramatises offers and increases lagging sales offers and increases lagging sales Generally short term and with quick response Unable to effectively build long term brand preference 30 Public Relations Highly credible and believable In forms such as news stories, new features, events and sponsorships Communicates to prospects possibly missed via Communicates to prospects possibly missed via other forms of promotion Considered relatively inexpe
nsive, however not free 31 Direct Marketing Telephone marketing, direct mail, online marketing etc Non-public Immediate Customised Interactive Well suited to highly targeting marketing efforts 32 Product Life Cycle 33 Braap Case Study In small groups discuss a promotion mix for Braap Advertising Personal selling Personal selling Sales promotion Public relations Direct marketing 34 Product pricing and distribution Positioning strategies Product attributes – reside in the product E.g. A cigarette can have reduced nicotine content (a A cigarette can have reduced nicotine content (a concrete attribute) Basketball shoes can have extra support around the ankle 35 Product pricing and distribution Positioning strategies Product benefits – reside in the product E.g. A cigarette can have reduced nicotine content (a A cigarette can have reduced nicotine content (a concrete attribute) Basketball shoes can have extra support around the ankle 36 Product pricing and distribution Positioning strategies Product attributes – reside within the product Product benefits – reside in the consumer E g. . A pair of basketball shoes can have extra support around the ankle (an attribute), reducing the wearer’s chance of injury. ( a benefit) 37 product attributes. Use one or more product attributes or features as the basis for positioning its product. E.g Dairy Australia focuses on the nutritional attributes of milk as a key gp selling point Kleenex tissues focus on softness, strength and absorbency. May also use a key benefit that the market is seeking as the basis of positioning their product. 38 Price and quality. Some firms use a high price (premium pricing) strategy to indicate that their product is high or superior quality, for example Godiva chocolates. Other firms use a lower p ,g q y rice, good quality strategy, such as Big W with its everyday low pricing strategy. 39 Use or application. Products can be positioned as the right product to use for a particular occasion or purpose. For example, meat pies may be targeted for consump , tion at the football, or a CUB Victorian Bitter may be a reward for a hard days work. 40 User Based on certain products being suited for certain users. For example, insurance policies that are sp yg , ecifically designed to senior citizens, such as Australian Pensioner’s Insurance Agency. 41 42 Product class When close substitutes exist, the firm may focus on the benefits its product class relative to other product classes. For examp , le a manufacturer of vinyl shutters may propose that vinyl is more durable, easier to clean and need less maintenance than wood shutters. Likewise, the dairy industry may seek to convince us that real cheese, such as Coon is more natural than processed cheese. 43 Competitor Some firms deliberately compare themselves to competitors as a means of gaining the desired position for their product in the mind of the consumer. For example, Avis states ‘We try harder’ as a basis of setting it apart from its competitors and in particular Hertz. Other firms deliberately position themselves away from competitors, known as ‘comparative advertising’. 44 Positioning strategy 45 Place or distribution Is the method for making the product available for the consumer It has a number of functions Information – providing market research providing market research information Promotion- implementing and conveying specific offers Contact – communicating and generating a rapport with potential buyers 46 Matching – modifying the process to meet the buyers requirements Negotiation – discussion and agreement of py p a ment terms and price Physical distribution – the mode of transport and storage of goods Financing – acquiring funds to finance distribution 47 Your in a band and you have a CD Discuss how you might distribute it 48 Possible answers Retail outlets – difficult for independants and retail stores frequently tied to large recording organisations Online – y pg our own webpage Personal selling – sell at your performances 49 Price What is the amount charged for the product or service? Product positioning must be determined before p g ricin confirmed Range of pricing strategies 50 Pricing Strategies Product line – Where there is a range of product or services the pricing reflect the benefits of parts of the range. For example car washes. Basic wash could be $20, wash and wax $40, and the whole package $60 51 Pricing Strategies Optional Product Pricing. Companies will attempt to increase the amount customer spend once they start to buy. Optional ‘extras’ increase the overall price of the increase the overall price of the product or service. For example airlines will charge for optional extras such as guaranteeing a window seat or reserving a row of seats next to each other. 52 Pricing Strategies Captive Product Pricing Where products have complements, companies will charge a premium price where the consumer is captured. For example a razor manufacturer will charge a low price and recoup its margin (and more) from the sale of the only design of blades which fit the razor. 53 Pricing Strategies Product Bundle Pricing. Here sellers combine several products in the same package. This also serves to move old stock Videos an This also serves to move old stock. Videos an CDs and DVDs are often sold using the bundle approach. 54 Pricing Strategies Price Skimming. Charge a high price because you have a substantial competitive advantage. However the advantage is not sustainable However, the advantage is not sustainable. The high price tends to attract new competitors into the market, and the price inevitably falls due to increased supply. 55 Pricing Strategies Promotional Pricing. Pricing to promote a product is a very common application. There are many examples of promotional There are many examples of promotional pricing including approaches such as Buy One Get One Free. Geographical Pricing. Geographical pricing is evident where there are variations in price in different parts of the world. For example rarity value, or where shipping costs increase price. 56 Pricing Strategies Value Pricing. This approach is used where external factors such as recession or increased competition force compp p anies to provide ‘value’ products and services to retain sales e.g. value meals at McDonalds. 57 Market Penetration Involves setting a low intial price in order to penetrate the market quickly and gain a large market share Effective when Market is highly price sensitive Production and distribution costs fall as sales volume increases E.g. Aldi entry into Australia 58 Analyse promotion methods Promotional campaigns need to support the marketing strategies and objectives Organisations that do not achieve sales or p pj rofits as projected should look to other causes than the promotional tactics 59 Distribution Channels Refers to the customer’s mode of purchase of the product At a shop Over the telephone Over the telephone Online via a website At a warehouse 60 Distribution chain for consumer products 1. Manufacturer 2. Wholesaler/distributor 3. Retailer 4. Consumer 61 The Internet Considered a new “place” for many businesses Enabled direct interaction (bypassing retailer) between wholesaler and consumer Low set up costs attractive to small and middle Low set up costs attractive to small and middle size businesses Site can be set up and then “tweaked” as feedback in gathered Monitoring marketing results Marketing performance Involves looking at what has happened and why Consider results and compare to goals Ask these questions Did marketing efforts reach target groups? Did the campaign run to schedule? Was the target market responsive? Monitoring marketing results Marketing performance Consider
how the marketing program influenced results Ask these questions Ask these questions Were there misdirected marketing efforts? Did a specific marketing activity help our results? What part of the marketing plan did what? Monitoring and control process Once you have analysed what did and didn’t work time to plan how to redirect marketing effort Monitoring & evaluating marketing efforts can be very difficult because of insufficient information Important therefore top use a suitable monitoring and control system Monitoring and control process Establish standards These relate to the budgeted sales and costs, and the timelines for the action plans implementation Measuring performance Measuring performance This captures and compares This captures and compares actual performance against the standards Proposing measures to correct deviations from the standard Detailing, corrective procedures to be implemented if variation from standard exceeds certain limits Monitoring and control process Control system operates on Personnel responsible for implementing the plan Rather than the schedules and costs themselves Market Share Analysis Studies the sales of an organisation and compares it the rest of the industry Can be obtained in some cases through trade associations and g (g overnment bureaus (e.g. ABS) Goals vs Results Once industry comparisons have been obtained it is necessary to break down results into product lines and market segments Once sales breakdown made, marketing manager needs to look at goals for each manager needs to look at goals for each segment As much information as possible should be gathered about competitor’s success in these segments and why This type of information is often difficult to obtain Methods for obtaining feedback Personnel – your staff can provide valuable insight into the marketing activities Target Market – this is crucial feedback Management – should be two way communication Stakeholders – need to know the status of budgets and why decisions made The media – the way your marketing is perceived and reported can have an impact on success of your campaing Measuring customer reaction Enables us to analyse and gather information but needs to managed Must have clear goals to the collection of this information What inf ? ormation needs to be collected? How will the information be collected? Will the methods provide information to enable conclusions to be drawn? Use the same method to collect further information later in campaign Measuring customer reaction What processes would best capture information for these questions What has been the customer’s feedback? What was our key focus of appeal? What was our key focus of appeal? Did we successfully appeal to our targets? What improvement suggestions do we have? What product features were promoted? What benefits of the product were promoted? Monitoring marketing revenue and costs Highlighting the financial impact the marketing performance has on the organisation is outlined in the marketing plan Detailing p revenue and expenses for all marketing decisions, should include timelines to reach goals and objectives Marketing costs must be closely analysed Monitoring marketing revenue and costs The budget should outline spending requirements for: Each decision Breakdowns by month Breakdowns by year Expenses can be shown by Individual product Geographic area Distribution network Preparing and presenting marketing reports Personnel and stakeholders must be informed of marketing progress Documenting and reporting promotional activities allows you to assess the success of a promotion Records might include Sales figures, promotional display assessment checklists, foot traffic, factors deterring customer from store (e.g. weather), competitor promos, complaints/returns, supplier issues