The role of marketing

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 China´s auto market growing rapidly

At 23, Shi lingxi bought his first car. He considered a Ford Focus, but last week he negotiated a huge dicount of 35000 yuan off a
brand-new Nissan Bluebird. Like millions of other new motorist in China, he does not plan to use it much, it is too hard to find a
parking space, but he looks forward to the freedom the car brings. China´s auto industry is now growing by around 1 million
extra vehicles a year, a rate of 23% last year. Although not the biggest market in the world, that is still in the USA, the growth rate
is the fastest. Whereas car sales did not increase at all in the USA in 2008, in China they are forecast to grow by 10% a year for at
least a decade. No wonder 100 global Chinese vehicle manufacturers are now competing in this market.

1. Explain why it is important to a car manufacturer selling to China that the car market is growing rapidly.
Because a growing market offers higher sales and profits due to the increasing demand of something. Also, China, which has the
largest population in the planet, could make up a significative revenue stream for the business, help them increase product
awareness in other parts of the world and stave off competition as well while increasing their market share.

2. Explain the diferrence between market size and market growth.

Market size refers to the magnitude of an entire industry, in terms of volumen, value of individual godos and sales
revenues from all businesses taking part of the market. In the other hand, market growth represents the increase in the size of a
market over a specific period of time which is tipically a year. Another difference is how both are measured, for example, market
growth can be measured by the change or difference in value of goods and total volume, and in the other hand, market size is
measured by customer bases and values which aren’t deducted from each other.
 Read the case study below and then answer the questions that follow:
A tale of two markets
Total sales in market A in 2009 were 54000 units. The average selling Price was $3.
Total sales in market B in 2009 were 10000 units. The average selling Price was $15.
In 2010, sales volumen of market A increased by 5% and the selling Price increased by 10%.
In 2010, sales volumen of market B was $180000, despite the average Price falling to $12.

Calculate the percentage increase in the total value of sales for market A between 2009 and 2010.
Value of Sales = Units sold x Price per Unit
2009 → 54,000 X 3 = 162,000
2010 → 56,700 X 3.3 = 187,110
187,110-162,000/162,000 x 100 = 15.5% growth
Calculate the percentage increase in total sales volumen in market B between 2009 and 2010.
Sales Volume 2009 → 10,000
Sales Volume 2010 → 180,000
180,000-10,000/10,000 x 100 = 1,700% growth
Marketing approaches (3 examples)
Product Orientation: Focused on producto innovation Market Orientation: Focused on knowing your target
and uniqueness. audience and adapting to trends.

Netflix:
Netflix provides customers with easy access to the latest
movies and TV shows, making large video rental stores
like Blockbuster obsolete. This company's success was
based on identifying a convenient option that the public Amazon: The gigant of retail is known for focusing on
hadn't yet realized was even possible and focusing on the customers and profitability. They have developed their
innovative product itself. Brand name as one that clearly addresses concerns and
desires expressed by customers, for example adding the
2-day delivery and the “Amazon Locker”, a network of
Ford Company Motors: self-service pickup boxes for people who are not at home
Back when Henry Ford inventend the assemble line, he for the majority of the day.
had made only model of car in black colour irrespective
of the perspectives of the consumer, he focused on
making them cars non-expensive and accessible for
everyone (that was his marketing idea).
 Market Orientation Product Orientation

Advantages Disadvantages Advantages Disadvantages

Greater confidence that Excessive focus on May lead to greater levels There is a risk of
new products are addressing the needs and of differentiation and customers not being
satisfying customers’ desires of consumers innovation interested in what you
needs reduces the scope for are creating.
innovation
Helps develop a broader This strategy only reacts Greater focus on Potential missed market
understanding of your to trends, it doesn’t intrapreneurship for big opportunities and trends.
customers create them. companies Also, consumers may not
(entrepeneurship within trust you could deliver
a business) the product if you don’t
have an established
reputation.