Question 1

1.1

Introduction

Marketing is concerned with recognizing and satisfying personal and social needs.
One of the simplest good definitions of marketing is "profitably meeting wants" (Kotler
& Keller, 2012, p.5). The marketing process model is divided into five sections. The
first four processes focus on creating something value for the consumer, while the
fifth one works to obtain something valuable from the consumer (Kotler & Armstrong,
2015, p. 6). A successful relationship with consumers is built by: defining buyers'
demands, developing a buyer-oriented marketing strategy, and developing and
launching the marketing programs required to obtain the best values.

The management of this procedure is part of the process of establishing relationships

with buyers. Consumer relationship management refers to the entire process of
providing the best values and ensuring their pleasure. Companies who believe it is
crucial to establish enabling conditions for buyer pleasure must define the meaning of
the value experienced by the buyer. The following information assists us in
determining what we indicated above: We must determine the difference between the
benefit received by the buyer and the price paid for the product. Typically, we
calculate the buyer's value in relation to competitors. The consumer purchases the
product of the company that, in his or her perspective, will provide the most
advantage to him or her.

A wide range of models that represent the components of the marketing

management process on the three levels of organizational structure are available in
specialized national and international literature. As a result, the initial framework of
the marketing management process presented by Lamb, Hair, and McDaniel (2007)
in their "Essentials of Marketing" shows the following sequence of phases.
1.understanding the organization's mission and the importance of marketing in
achieving the mission; 2.establishing marketing objectives; 3.collecting, analyzing,
and processing information about the organization's situation, as reflected in terms of
strengths and weaknesses, environmental opportunities and threats; 4. Creating a
marketing strategy entails identifying specific target groups and their specific
demands that the business will attempt to meet (the target market strategy) and
generating optimal marketing actions (the marketing mix) to meet the selected target
markets. According to the author, the marketing mix should include product,
distribution, promotion, and price strategies in order to generate exchanges that meet
individual and organizational goals. 5.marketing strategy implementation; 6.
performance measurement; 7. frequent evaluation of marketing efforts, with revisions
made as needed.

Wright's book, Marketing: Origins, Concepts, Environment, provides a more

streamlined structure of the marketing management process. According to this
source, the marketing management process is divided into three phases, each with
its own set of activities: 1. marketing planning (a set of objectives, evaluating
prospects, formulating marketing strategies, and generating marketing plans); 2.
marketing plan and program implementation; 3. marketing plan and program control
(measuring results, evaluating progress).

In "Marketing Management: A Strategic, Decision-Making Approach," John Mullins

and Orvillle Walker (2005) propose a more detailed framework, focusing on key parts
of strategic planning as premises of rigorous leadership marketing operations, such
as: 1. external environment analysis aimed at: a. marketing's role in strategy
development (goals and strategies related to corporate level and strategic units); b.
market opportunity analysis (the 4C - company, context, customer, competitors)
emphasizing issues such as understanding market opportunities, consumer behavior,
marketing research, marketing segmentation and target selection target, positioning;
2. creation of strategic marketing programs (the four Ps - product, price, placement,
and promotion), including marketing program and business strategy decisions; 3.
creating strategic marketing campaigns for specific conditions (new market
strategies, rising markets, maturity, and decline); 4. marketing program
implementation and management, with an emphasis on program organization and
planning, as well as performance measuring and motivating marketing performance.

Mullins and Walker (2005) are the writers who emphasize the necessity of current
informational marketing systems within a business, as well as credible research, in
order to assist the marketing management process. According to the two authors'
proposed structure, the entire process of marketing activity management can be
reduced to the blending of three stages: strategic plan (mission, goals, strategies,
portfolio of activities), marketing plan (environmental analysis, marketing objectives,
target market selection, marketing mix), implementing and monitoring strategic plans,
and marketing mix.
Structures of the marketing management process are offered that are comparable to
those discussed thus far, and Aaker (2007), Richard Wilson, and Colin (2005). As
shown in the preceding study, most marketing experts divide marketing process
management into three tiers of organizational structure, capturing, in a broader or
narrower sense, the four core activities - analysis, planning, execution, and control -
or their component activities.

A structure of the marketing management process that differs from those presented
thus far is that proposed by Jain, S.C (2000) in his work "Marketing, planning, and
strategy," where the theory proposed emphasizes the idea that marketing
management is reduced to tactic activities that are specific to the functional level.

Essentially, the author offers the approach to strategic planning as a starting point for
the defining of the concept and development of the marketing management process.
To grasp the concept of marketing management, one must first understand the
strategic marketing approach, according to Jain (2000)'s thesis. According to this
theory, marketing inputs supply the important aspects in establishing an overall
strategy plan at the corporate level: competitive analyses, market dynamics, and
external environmental considerations. At this stage, marketing serves as a link
between the business and the reference market, providing current and future
information about the area of demand manifestation, all of which play an important
role in any strategic planning activity.

According to the author, at the opposite end of the scale is marketing management,
which, by designing and implementing marketing programs, supports the concept of
strategic marketing, on marketing strategies for various pairings of product-markets.

Marketing strategies are formed at the organization's second level, namely the
strategic units. The marketing strategy in a given setting is fundamentally constructed
by the interposition of three known factors in literature as the 3 C: consumer,
competition, and corporate. Marketing strategies are centered on identifying key
difference features of the competition and capitalizing on them in order to give higher
value to customers. According to Jain (2000)'s theory, there are certain differences
between strategic marketing and marketing: orientation, philosophy, strategy,
relationship with the environment and other components of the company, managerial
style required.
Regardless of the arguments advanced by Jain and his supporters, the majority of
the literature converges on the concept and structure of the marketing management
process as described by Kotler, a marketing management activity (or the application
of marketing philosophy), rather than a set of activities confined to tactical marketing
functions.

A marketing strategy is a long-term plan developed by a company to attain specified

organizational goals. The plan specifies how the company will reach its target market
and the particular steps it will take to convert potential customers into real purchasers
of the company's products and services.

Marketing strategy should be long-term and forward-thinking, with rules on how the
firm will use its limited resources to enhance sales. A solid marketing strategy should
include the company's value proposition, target consumer demographics, brand
messaging, and other components aimed at boosting revenue.

When developing a marketing strategy, it is critical to identify the precise actions that
the firm will prioritize in order to enhance sales. A effective marketing plan should
incorporate the following elements:

Segmentation
The target market of a corporation is divided into several segments. The organization
can determine the segments and categorize clients based on their needs using
market data. Customers in the segments should have comparable interests, needs,
or live in the same areas, and they should respond similarly to the company's
marketing efforts.

Instead of executing marketing campaigns that target each consumer individually, the
company can save time and money by grouping customers into smaller categories.
Furthermore, if one sector responds more favorably than others, the organization can
better allocate its efforts to maximize outcomes.

Targeting and Positioning

Targeting is determining the most desirable segments in the target market and
organizing marketing operations to make the segment appealing. The segment
chosen should be the most profitable for the company. The products or services
given to the segment must meet the needs and expectations of the target segment's
customers.

The third step in the segmentation, targeting, and positioning process is positioning,
which focuses on acquiring a competitive edge over rival items in the market. In order
to portray oneself as the most appealing alternative in the minds of consumers, the
company must evaluate its competitive advantage in the segment.

Overall, positioning should offer consumers more value than rivals and effectively
convey the distinctiveness of the product to the customer.

Promotional Techniques
Promotional techniques are actions that specify how a company advertises its goods
or services. It is a procedure used by businesses to guarantee that the target market
is informed about the product or service and how it might suit their demands.

The greatest promotional strategies can aid a business in making optimum use of its
limited financial resources. Distribution of promotional goods, TV and radio
advertising, social media communication, public relations campaigns, exhibits, etc.
are examples of promotional strategies.

Monitoring, Evaluation, and Assessment

The business should monitor and assess its marketing strategy after it has been
designed and implemented to see how effectively it is working and whether the
intended results are being obtained.

Instead of being a one-time procedure, strategy evaluation ought to be continual. It

need to assist management in revising the current marketing strategy and
comprehending how to set up subsequent marketing plans.

The Four Ps of Marketing: Marketing Mix

An organization must undertake market research before developing a marketing plan
in order to comprehend the target market, recognize its competitors, and determine
other elements that affect its capacity to convert potential customers into actual
consumers of its goods or services.
The 4 Ps of marketing should then be incorporated into the company's marketing
plan. The 4 Ps assist a company in differentiating itself from the competition by
highlighting a brand's distinctive value.

The four pillars of marketing are as follows:

Product
A product is a good or service that is provided to the target audience in order to meet
their requirements and desires. Marketers should have a firm understanding of what
the product stands for and the product should address an unmet demand in the
target market. An organization must comprehend the product life cycle and how to
handle the product at each stage for the product to be successful. The company
should be aware of how the product differs from the competitors.

Price
A product's pricing determines its monetary value, and it plays a significant role in the
amount of money a business will generate. An company must take into account both
the actual and perceived worth of a product when determining its pricing.

They must expertly choose the right price for the product so that it is neither too
cheap nor too high in a way that harms the reputation of the brand. Additionally,
marketers should decide when it is suitable to lower the product's price.

Place
Place refers to the site where the organization's products or services will be sold.
Marketers must decide where the product will be sold and how the business will
deliver the product to the end user. The organization should ensure that the product
is not just easily accessible to the customer, but also conveniently positioned.

Promotion
Promotion encompasses all of the organization's marketing methods, such as
advertising, public relations, social media marketing, direct marketing, and so on. The
purpose of product promotion is to transmit relevant product information to the buyer
and explain why they should pay a specific price for it. Product promotion has
become easier in the digital age, and marketers may reach a broader audience at a
lesser cost than traditional marketing.
Marketing trends come and go, altering as brands attempt to better use the latest
technologies and respond to market shifts. It's no longer just about making a big
statement or providing eye-catching content. Businesses must then interact with
prospective customers in meaningful ways, create a reputation as a reliable source of
information, and cultivate those relationships after making target audiences aware of
their existence.

That's a tall order when so many customers are engaged with dealing with the effects
of the global pandemic on their life. In this atmosphere, brands would be prudent to
capitalize on emerging marketing trends that promise to provide them a competitive
advantage.

Longer-Term Influencer-Brand Partnerships

Long-term influencer-brand ties are anticipated to grow, with producers taking on a

range of brand ambassador positions and a general shift toward always-on content
rather than one-time deals. Longer-running campaigns that harness influencer
experience and trustworthiness will allow brands to develop more authentic
connections with their audiences.

E-Commerce with a Personal Touch

Experiential e-commerce will be critical for all companies selling online. To meet user
expectations, shops and subscription sites, as well as software as a service
platforms, will need to develop dynamic, engaging, and highly personalized paths.
Brands are battling for their customer base, and experiential e-commerce will be the
winner this time.

'Doing Digitally Right'

As long-term partnerships with brands emerge, communications agencies will

change from a transactional to an advisory position. While the communications
industry has prioritized digital-first in recent years, 2022 will be focused on "doing
digital right"—using digital tools to enhance integrated communications projects
when and where it makes sense.
The Evolution of Interactive Content

Buyers' journeys are getting increasingly independent. As marketers, we must take

this into account and make things easier for users. Businesses may need to invest
more time and effort in keeping prospects interested and assisting them in finding
what they are looking for, therefore one trend that may emerge in 2022 is the
emergence of interactive content.

Monitoring of Intent

It's time for marketers to focus on their most important business goal: locating buyers
who are ready to buy. To that end, it's useful to know who's looking for your solution
—and who might be in the market. Intent monitoring is the solution, and it's a top
trend that we expect to increase in 2022. When combined with actionable insights, it
provides a potent means of influencing corporate progress.

New Virtual Reality Software Tools and Apps

With Facebook's (now Meta) recent pronouncements about the metaverse,

consumers can expect new software tools and apps to be offered in the virtual reality
environment.

A Resumption Of Business Travel And In-Person Meetings

Clients and members of the customer advisory board all express a wish to "go back
on the road" and meet with their peers face-to-face as usual, putting the pandemic
behind them once and for all.

New Teamwork and Collaboration Methods

The workplace is not a physical location; it is a state of mind. The work environment
will continue to be changed as a result of Covid's impact. The market reaction is
massive. Employers must be inventive in balancing productivity and employee
requirements; those who prosper will seek new ways to do "work" as well as new
techniques of teamwork and collaboration.
Alternative Methods of Targeting

With third-party cookies set to be phased out in 2023, marketers will be trying
alternative targeting options, such as people-based targeting, during 2022. Before
cookies are completely eliminated, companies that can harness and expand on first-
party data will need to be verified.

A Significant Change in Who Conducts Research

We anticipate a significant shift in who conducts research efforts in the insights

business. The obstacles to market research have been dramatically reduced, thanks
to both the Covid-19 pandemic and increasingly user-friendly technologies. That
implies marketers, product designers, user experience professionals, and others will
no longer be passive consumers of data, but will also play an active role in its
creation.

A Renewing Focus on Reputation

Over the last 18 months, we've witnessed a rise in the fragility of businesses in the
country, as well as their balancing act of trying to resonate in a polarized
environment. How does a brand get advocates while without offending a market
segment? It's an unprecedented situation for brands to deal with.

Pages with Long-Form 'Guidelines'

The best material will triumph. Everyone, though, is creating lengthy "guide" pages.
As a result, putting them in the best manner possible and making them legible and
shareable will be critical. Those who can make their web pages more fascinating will
win and have a more successful online presence.

Larger Companies Are Moving Online/Digital

In 2022, there will be a need to focus on and adapt to cryptocurrencies and

nonfungible tokens, as well as shift firms to the internet marketplace. We've already
seen the shift to online/digital that was required during the epidemic, and that
tendency is only going to grow. Companies should begin incorporating these
elements into their strategies as they plan ahead to avoid falling behind.
Question 2
2.1
Introduction
Marketing research and practice have expanded significantly, from an emphasis on
marketing as a functional management issue to a broader focus on marketing's
strategic role in overall corporate strategy (e.g., Kotler, 2000; Sudharshan, 1995).
This expansion of the marketing idea to incorporate both strategic and operational
decisions has resulted in a conflation of marketing and strategic management.
Managers all throughout the world recognize the growing importance of developing
marketing strategies to compete effectively in global markets.

The advent of a more open global economy, globalization of consumer tastes, and
the creation of a global commercial web have all strengthened the interdependence
and interconnectedness of global markets. In such a global setting, enterprises
should design their marketing strategy around three essential dimensions: (1)
standardization-adaptation, (2) configuration-coordination, and (3) strategic
integration (Zou and Cavusgil, 2002). We describe a firm's marketing strategy, after
Sudharshan (1995), as the creation of and decisions concerning a firm's connections
with its key stakeholders, its offerings, resource allocation, and timeliness.

The first, and perhaps most important, dimension of a multinational corporation (MNC
global )'s marketing strategy is the standardization or adaptation of marketing
programs, such as product offering, promotional mix, price, and channel structure,
across different countries (Yip, 2003).The second part of a global marketing strategy
focuses on the configuration and coordination of a company's value chain activities
across countries (Craig and Douglas, 2000). Finally, the strategic integration factor is
concerned with how an MNC's competitive conflicts are planned and conducted
across country markets (Birkinshaw, Morrison, and Hulland, 1995).

A marketing strategy is a company's overall game plan for reaching out to

prospective customers and converting them into customers of their products or
services. A marketing plan includes the value proposition of the organization, key
brand message, statistics on target customer demographics, and other high-level
elements.
A well-defined marketing strategy should focus around the firm's value proposition,
which communicates to customers what the company stands for, how it runs, and
why they should do business with it. This gives marketing teams a framework to use
for campaigns involving all of the company's products and services.

The marketing strategy is detailed in the marketing plan, which is a document that
defines the precise types of marketing activities that a firm engages in and includes
timelines for implementing various marketing efforts.

Marketing strategies, as opposed to individual marketing programs, should ideally

have a longer life period because they incorporate value propositions and other
critical parts of a company's brand, which generally remain constant over time. In
other words, marketing strategies encompass broad messaging, whereas marketing
plans contain detailed campaign logistics.

For example, a marketing strategy may state that a company's goal is to gain
authority in niche circles where their clients frequent. The marketing strategy enacts
this through commissioning thought leadership posts for LinkedIn.

A marketing strategy's ultimate purpose is to achieve and communicate a lasting

competitive advantage over competitors by understanding their needs and desires. A
marketing asset can be rated based on how efficiently it communicates a company's
primary value proposition, whether it's a print ad design, mass customisation, or a
social media campaign.

Market research can help track the performance of a given campaign and find
untapped populations in order to meet bottom-line targets and improve revenue.

There are several processes involved in developing a marketing strategy. HubSpot, a

digital marketing resource, can help you develop your approach.

Identify your objectives: While sales are the ultimate goal for every business, you
should also have shorter-term objectives such as building authority, enhancing client
interaction, or generating leads. These smaller objectives provide quantitative
benchmarks for the progress of your marketing strategy. Consider strategy to be the
high-level ideology, and planning to be how you achieve your goals.
Know your customers: Every product or service has a target consumer, and you
should be aware of who they are and where they spend their time. If you sell power
tools, you'll select marketing platforms through which general contractors can view
your message. Determine who your client is and how your product will benefit them.

Create your message: Now that you've determined your objectives and who you'll be
pitching to, it's time to develop your messaging. This is your chance to demonstrate
to prospective customers how your product or service will benefit them and why you
are the only firm that can supply it.

Create a budget: How you distribute your message may be determined by your
budget. Will you spend money on advertising? Are you hoping for an organic viral
moment on social media? Sending out press releases in an attempt to get media
attention? What you can afford to do will be determined by your budget.

Determine your channels: Even the best message need the right medium. Some
businesses may find it more beneficial to create blog posts for their website. Others
may find success with paid social media ads. Determine the best forum for your
content.

Measure your success: In order to target your marketing, you must know whether it is
reaching its intended audience. Set your measurements and decide how you will
measure the performance of your marketing efforts.

A marketing plan directs a company's advertising dollars to where they will have the
greatest impact. In 2022, the association between organization and success in
marketers increased from about four times more likely in 2018 to nearly seven times
more likely.

Product, pricing, promotion, and place are the four Ps. These are the primary
elements involved in the marketing of a product or service. The four Ps can be used
to create a new business endeavor, evaluate an existing product, or optimize sales
with a specific audience. It can also be used to test an existing marketing plan on a
new audience.

A marketing strategy will outline a company's advertising, outreach, and public

relations strategies, as well as how the organization will measure the impact of these
initiatives. They will usually stick to the four Ps. Market research to support pricing
decisions and new market entries, tailored messaging that targets specific
demographics and geographic areas, platform selection for product and service
promotion—digital, radio, internet, trade magazines, and the mix of those platforms
for each campaign, and metrics that measure the results of marketing efforts and
their reporting timelines—are all functions and components of a marketing plan.

Since a marketing plan is built on an overarching strategic framework, the phrases

"marketing plan" and "marketing strategy" are frequently used interchangeably. In
some circumstances, the strategy and plan may be combined into a single document,
especially for smaller businesses that may only run one or two big campaigns per
year. The marketing plan outlines monthly, quarterly, or annual marketing efforts,
whereas the marketing strategy provides the overall value proposition.

A market is all of the potential customers who might buy your product. This includes
persons who buy and don't buy, as well as those who could buy but don't know about
the offer1. Market segmentation is the practice of breaking down a large consumer or
commercial market into subgroups based on shared features. Understanding who
your audience is and how you can speak to them as a marketer has never been
more vital as consumers become more knowledgeable, fickle, and demanding.

It is vital to realize that marketers can target a variety of markets. Some are more
commercially valuable than others, therefore marketers must evaluate each one to
determine which is viable in order to increase sales and profits. We can segment
audiences based on product consumption using local market data. Marketers can
then target a certain segment (this is known as a target market).

The extent to which corporations segment their markets is also determined by their
access to market data and the level of market fragmentation in their individual
product categories, as some product categories are far more complex than others.
Financial services, such as banking and insurance, are examples of complex product
offers that necessitate more sophisticated segmentation than mass-market product
offerings, such as fast food and telephones, which necessitate more basic
segmentation.

Using the South African Social Economic Measure (SEM) collection of studies, based
on family structure and community infrastructure, the organization can develop and
segment target markets based on demographics, psychographics, product or brand
consumption, and media kinds.

To determine which SEM the consumer belongs to, each person is assigned a score
between 0 and 100 based on the things in their household and the public services to
which they have access. This is then reorganized into SEMs 1-10 to aid in targeting.
SEM 1 has extremely low income, huge unemployment rates, and lives effectively
below the breadline, whereas SEM 10 is the polar opposite.

The segmentation, targeting, and positioning (STP) process establishes the

relationship between a company's whole potential market and how it decides to
compete in that market (its marketing strategy). The segmentation process's purpose
is to assist a corporation in developing and implementing the most effective
marketing mix to influence a desired segment. Diagnosis, strategy, and tactics are
the three stages of consumer marketing strategy. Segmentation is a component of
diagnostic and is required prior to targeting.

The segmentation, targeting, and positioning (STP) process establishes the

relationship between a company's whole potential market and how it decides to
compete in that market (its marketing strategy). The segmentation process's purpose
is to assist a corporation in developing and implementing the most effective
marketing mix to influence a desired segment. Diagnosis, strategy, and tactics are
the three stages of consumer marketing strategy. Segmentation is a component of
diagnostic and is required prior to targeting.

The market is sized and divided into homogeneous groups or groupings based on
shared values throughout the segmentation process. This creates a map of possible
targets for consumers based on supplied attributes. The better the segmentation, the
more clear the map. The marketer will then strategize about which segments to
target and how to position the product in the minds of consumers (typically compared
to competitors' positions). Based on the strategy, the marketer can then select
relevant methods (the marketing mix). The segmentation approach is responsible for
tactical implementation's success.

The market is sized and divided into homogeneous groups or groupings based on
shared values throughout the segmentation process. This creates a map of possible
targets for consumers based on supplied attributes. The better the segmentation, the
more clear the map. The marketer will then strategize about which segments to
target and how to position the product in the minds of consumers (typically compared
to competitors' positions). Based on the strategy, the marketer can then select
relevant methods (the marketing mix). The segmentation approach is responsible for
tactical implementation's success.

Audiences can be segmented simply or complexly, taking into account variables like
as product consumption, demographics, psychographics, and behavioral and media
consumption.

Any product or service's consumption is a natural segmentation variable. Consider

the field of health and fitness as an example. Virgin Active's potential segmentation
strategy could look at the gym-goer versus the non-gym-goer market; or within the
gym-goer market, there would be regular/weekly visitors who are very health
conscious or people trying to lose weight, moderate/monthly visitors who are trying to
stay relatively healthy and maintain their weight, or light/pre-Summer visitors who
want to get in shape for the holidays. They may also compare the Virgin Active
member to the Planet Fitness member to see what the distinctions are and what their
competitive advantage might be.

Demographic segments are the most commonly utilized segmentation variable, and
they are founded on the assumption that consumer requirements and desires are
closely connected with demographic parameters. Cosmetics, sanitary protection, and
infant items, for example, would very certainly be marketed to women rather than
men. Other demographic filters can be implemented within this bigger category,
depending on the product.

Psychographics further categorize your market depending on how your consumer

sees the world and takes into account various personality traits, values, attitudes,
interests, and lifestyle aspects. These metrics can provide valuable insight into how
to address your market and which messages will be most effective, as well as ideas
for new product development areas and new designs to fulfill specific needs.

Behavioural segmentation examines distinct groupings of people based on their

actions. Virgin Active, for example, would divide the market into three categories:
non-active, moderately active, and heavily active. Depending on their company
goals, they would choose one or two sectors to target with targeted advertising.
The utilization of devices and media channels can also be employed to segment
viewers. Technical items might seek to target tech-savvy or early adopter customers,
whereas a television broadcast channel would want to target heavy television
viewers, and convenience products could want to target an on-the-go market.

Long-term influencer-brand ties are anticipated to grow, with producers taking on a

range of brand ambassador positions and a general shift toward always-on content
rather than one-time deals. Longer-running campaigns that harness influencer
experience and trustworthiness will allow brands to develop more authentic
connections with their audiences.

As long-term partnerships with brands emerge, communications agencies will

change from a transactional to an advisory position. While the communications
industry has prioritized digital-first in recent years, 2022 will be focused on "doing
digital right"—using digital tools to enhance integrated communications projects
when and where it makes sense.

Buyers' journeys are getting increasingly independent. As marketers, we must take

this into account and make things easier for users. Businesses may need to invest
more time and effort in keeping prospects interested and assisting them in finding
what they are looking for, therefore one trend that may emerge in 2022 is the
emergence of interactive content.
Question 3

3.1
Introduction

There are three major pricing techniques when it comes to anything (B2B,
B2C, product or service): cost-based or cost-plus pricing, market-based
pricing, and value-based pricing. While more tactics are claimed, the most are
offshoots or modifications of these three.

Cost-plus or cost-based Pricing:

Cost-based or cost-plus pricing is exactly what it sounds like: the cost of a

product or service is calculated and a standard margin is added to the cost.
For example, if a widget costs R2.50 to create, a 50% standard margin means
the widget costs R5.00.

Pricing based on the market:

Market-based pricing is when a product or service's price is set based on its

competitive market position—basically, pricing that is on par with or near your
competition. Commodities (raw materials, basic resources, agricultural, or
mining items such as iron ore, sugar, or grains such as rice and wheat, for
example) frequently fall into this category because pricing is determined by
what the market is willing to pay. Companies whose pricing strategy is to be
"fast-followers" are another common example of market-based pricing. A fast-
follower is a corporation that changes its prices immediately after its
competitors do (quickly following suit, aka fast-following).

Pricing based on value:

The third and most difficult to implement approach is value-based pricing. This
pricing technique attempts to assess the determined "worth" of a good or
service from the buyer's perspective and then charge based on that perceived
value.

Business-class plane tickets are an excellent illustration of value-based

pricing. Business-class tickets provide significant value to a portion of
customers—added comfort, early boarding, dinner service, arriving at
destination well-rested (particularly valuable on long-haul flights)—and airlines
charge appropriately.

Cost-based and cost-plus pricing is frequently the most popular method of

setting a price since it is simple to compute, generally objective, produces
predictable margins, and does not need a lot of effort to implement.

Customers may easily justify cost-based and cost-plus pricing because it is a

fairly basic approach to price: If it costs x to produce a product, the producer
must charge x plus a margin to make a profit.

Manufacturers in the consumer products industry, for example, will frequently

exploit this by presenting stories about a surge in the cost of a key commodity
utilized in the creation of their items. Because the product now costs more to
make, the manufacturer has found a means to pass on the price rise, actual
or not, to the consumer.

However, there are some significant disadvantages to cost-based/cost-plus

pricing. The most obvious is that it is inward-focused, only addressing internal
cost concerns and not exterior factors such as a customer's willingness to pay
a premium.

Another significant disadvantage is the accuracy of the "cost" used to

calculate the pricing. Fixed costs are frequently difficult to assign to specific
goods or services inside an organization. Fixed costs are allocated differently
when input costs fluctuate. There are numerous reasons why costs can
fluctuate inside an organization, which can result in customers not believing
manufacturing costs are accurate and, as a result, not purchasing the product.
Cost projections that are later discovered to be erroneous, perhaps resulting
in a shortfall in the desired standard margin.

Market-based pricing extends beyond the navel-gazing of cost-based pricing

to set prices based on market realities.

The commodity market is the most common application of market-based

pricing. For industries that are not commodities, market-based pricing is
critical rival pricing. When organizations benchmark their prices to their main
competitors, either market leaders or those similar in size and geography, this
is known as key competitor pricing.

In the food services industry, for example, the market price is critical for
suppliers selling raw ingredients to restaurants. Restaurants will frequently
choose the cheapest ingredients because they are a part of the meal and not
the exclusive focus. This factor makes the market/competitor price of items
(such as vegetables, fruit, meat, and so on) crucial to the pricing strategy.

Market-based pricing is especially advantageous for corporations with a cost

advantage in the market, such as Walmart. Because of Walmart's cost
advantage (the ability to sell things at a lower cost than competitors), they
may offer pricing at a market discount when compared to other retailers.

However, there are several disadvantages to market-based pricing. The

market-based strategy, like cost-plus pricing, does not take the buyer's desire
to pay into account, which means money is likely to be lost.

It is also worth noting that obtaining competitive market data in some

businesses can be difficult and unreliable, making it difficult to establish
pricing competitive with your competitors. While there are systems that track
competitive market prices, they are frequently costly and unreliable since
prices are aggregated to preserve privacy.
While market-based pricing provides a better outer picture than cost-plus
pricing, it still ignores the buyer/input customer's and, as a result, the
opportunity for more profit.

Value-based pricing advances the pricing strategy method by taking the

customer's willingness to pay into account when determining the price of a
good or service.

This strategy has grown in popularity in recent years, but it is also one of the
most hardest to implement. This technique is used by marketing departments
because it measures and charges for the value that a product or service
provides.

Its renown stems from the fact that profitability may be maximized by
extracting the maximum value from customers by charging exactly what they
are willing to pay. However, in order to price based on value, one must be
able to quantify the perceived value and, as a result, the customer's
willingness to pay. There are several options for accomplishing this:

Conjoint analysis is a type of traditional market research.

Statistical modeling utilizing decision-making methods
Workshops and other quantitative and qualitative methodologies (for example,
price value mapping exercises).

The problem is that most businesses lack the internal ability to carry out these
tasks since they demand specialized expertise and time. Value-based pricing
is not only more difficult to execute than the other two pricing systems, but it is
also more expensive. The increased payout, on the other hand, makes value-
based pricing a worthwhile endeavor.

However, there are several disadvantages to value-based pricing. After all,

various clients' willingness to pay varies. In an ideal world, a corporation
would be able to charge each consumer a fee based on their willingness to
pay, but this is not possible in practice.
Understanding what groups of customers exist and what each specific group's
perceived values are as compared to others is a critical component of value-
based pricing. Companies that can differentiate their products (for example,
through versioning—version A offers three features for x price, and version B
offers five features for x price) can capture a larger share of the market,
increase sales and profitability through product differentiation for different
customer segments, and avoid cannibalization of overall sales.

However, value is ultimately subjective, and in many circumstances, when

using value-based pricing, businesses are guessing the hypothetical value
customers will benefit from. A specific car engine oil, for example, may reduce
repairs by up to 20%. However, if the manufacturer sets the price based on
the 20% reduction and consumers only experience 5% fewer repairs, the
price may not reflect the value supplied, and the company risks losing
customers.

Despite its benefits, value-based pricing is difficult to implement, especially if

competitors are not pricing on value. When a company pricing based on value
competes with a company pricing based on cost, the value equation
frequently degrades.

While value-based pricing is a step in the right direction for most businesses,
it is not a panacea.

Each of the three most prevalent pricing schemes has advantages and
disadvantages, and various groups within an organization prefer one over the
other. Finally, using a balanced Revenue Management framework that
combines all three approaches and takes a unified approach to pricing across
the firm is the best way to determine prices.

This balanced approach encourages all major stakeholders—finance, sales,

and marketing—to participate in the pricing process. Companies can use this
information to make decisions based on internal costs/profitability (financials),
external market forces (competition), and willingness to pay (customer value).
A balanced pricing plan helps your organization to be more flexible with price
and allows for micro-optimization. A corporation, for example, may price two
very comparable product lines differently depending on geography/market. In
one market, there may be several competitors (need to set prices more
competitively), whereas in another, the company may have a monopoly (can
price higher).

Companies that use the Balanced RM pricing model might achieve higher
profit margins. In our experience, organizations that use a balanced approach
outperform individual pricing strategies (cost plus, value-based, and market-
based) by up to 70%.

Finally, it is critical to remember that pricing is a journey rather than a

destination. Because landscapes are constantly changing, adaptation is
essential regardless of the existing pricing strategy.

Typically, firms progress from market-based pricing to cost-plus pricing, and

then, as they develop, to value-based pricing. As your company expands, be
sure that your pricing approach evolves with it. Be agile and opportunistic;
evolve, adapt, and capitalize on your ever-changing surroundings.
3.2

Introduction

The strategic management process is a constant culture of appraisal that a company

uses to outperform its competition. As simple as it may appear, this is a complex
process that also includes developing the organization's broader vision for current
and future goals.

Different organizations develop and implement their management strategies in

different ways. As a result, the company can choose from a variety of SMP models.
The right model is determined by a number of criteria, including the organization's
current culture. The organization's market domination. Leadership personality,
Experience of the organization in developing and implementing SMPs, as well as
industry and competition.

The major goal of the strategic management process is to assist the firm in achieving
long-term strategic market competition. SMP adds value to a company by focusing
on and assessing opportunities and risks, then exploiting the business's strengths
and weaknesses to help it survive, grow, and expand. A strategic management
method can assist a corporation in accomplishing this by:

Serving as the organization's point of contact for any critical decisions.

Leading the company in charting its future and moving in that direction. SMP include
developing the organization's goals, establishing realistic and attainable objectives,
and ensuring that they are all consistent with the company's vision. Assisting the
company in becoming proactive rather than reactive. With the SMP, the company
may assess its competitors' actions in relation to market trends and determine the
steps that must be made to compete and flourish in the market.

Preparing the organization for any future problems and investigating prospective
prospects in which the business must be a pioneer. The steps of the strategic
management process also include identifying the best strategies to overcome
difficulties and capitalize on new possibilities. Assuring that the company can
compete in a changing environment and survive in an unpredictable market.
Assisting in the identification and enhancement of the organization's competitive
advantages and core skills. These are in charge of the company's survival and future
growth.

There are five strategic management process steps that must be completed in the
sequence listed.

Setting objectives
Essentially, this is clarifying the organization's vision. The vision will comprise short-
term and long-term goals, the processes for achieving them, and the people in
charge of carrying out each activity that leads to the achievement of the goals.

Analysis
Analysis entails acquiring data and information necessary to achieving the objectives.
It also includes analyzing any internal and external data that may affect the
organization's goals and understanding the needs of the firm in the market.

Strategy Development
A business will only prosper if it has the resources necessary to achieve the goals
established in the first phase. Formulating a strategy to achieve this may entail
determining which external resources the organization requires to thrive and which
aims must be prioritized.

Implementation of Strategy
Because the goal of the strategic management process is to propel a company
toward its goals, an implementation strategy must be in place before the process can
be considered viable. Everyone in the organization must grasp the process and
understand their roles and responsibilities in order to contribute to the overall aim of
the organization.

Control and evaluation

Performance appraisal, as well as a regular review of both internal and external
challenges, are among the evaluation and control actions for the strategic
management process. If necessary, the organization's management can take
remedial action to ensure the SMP's success.
Strategic management must be used in order for a company's efforts to have the
most influence on its bottom line. This will also go a long way toward assisting a
corporation in surviving market rivalry.

Here's what a company may do to align its teams for success.

Ensure open departmental collaboration.

Teams cannot align until they collaborate. Begin by encouraging your business
teams to be open and honest in order to enable them work as one larger entity. Sales
and marketing leaders and teams should meet on a regular basis to track agreed
goals and freely talk about workflow, problems, and successes. Leadership within
and outside of departments can develop a collaborative environment rather than an
us-versus-them environment.

Define clearly who the leads are in your organization.

Quality leads must be defined similarly by marketing and sales. If the organisation
target leads that sales does not consider qualified, your inbound marketing concepts
will fail. In turn, sales turns its wheels, returning leads to the queue if they don't
move.
Gather the teams and document what a lead is. Then the organisation must define
terms such as marketing qualified lead, sales qualified lead, and opportunity. After
the company has defined each type of lead, decide how each team will manage it.

Record the hand-off process from marketing to sales.

The sales plan cannot begin to work unless qualified leads are transferred from
marketing to sales in a timely manner. At the same time, if marketing is hurrying
leads to feed the sales queue, the conversion rate may suffer. Avoid these
challenges by defining a procedure for determining when marketing has done its task
and when sales should enter the picture. Then, ensure that everyone in both
departments understands how the hand-off works and when it is suitable for certain
types of leads.

Collaborate to define an ideal buyer.

The target market must be understood by both sides. If sales and marketing have
different ideas about who their target audience is, even the best software and
leadership won't be able to bridge the gap. Working collaboratively to construct an
ideal buyer profile means that marketing teams create content and develop a website
conversion strategy that drives the proper kind of leads – those that make the best-fit
clients.

Work with the two teams to create service level agreements.

Service level agreements are one approach to ensure that your new sales and
marketing strategy continues to operate once you build it. Create SLAs for both sides
of the equation so that marketing understands how many marketing qualified leads
sales expects each week, month, or quarter and sales understands what actions
must be completed immediately (or within a short period of time) when a MQL enters
the funnel.

Make a process for returning leads to marketing for triage.

Leads do not move in a straight line in a solid marketing and sales process. Build a
procedure to pump bad or incomplete leads back up the funnel, just as you did for
leads entering sales from marketing. Leads, even those deemed unworthy by sales
at the time, should not be discarded. Reintroducing them to marketing allows teams
to: Constant communication ensures that lead processes are always strengthened.
Triage leads that have the potential to be valuable assets in the future. Save time by
learning from or revising leads that do not make the initial cut.

Include a CRM for efficiency.

As you can see, integrating sales and marketing teams necessitates a great deal of
back-and-forth communication and processes. Things can swiftly deteriorate into
anarchy if the proper infrastructure is not in place (or at least frustrating confusion).
Use a CRM to track your leads and allow for controlled, visible progress through the
funnel.

Use dashboard reporting to provide real-time visibility into the funnel.

Finally, once you've designed and implemented all of the communication and
workflow tools, create a dashboard for real-time reporting on all levels of marketing
and sales activities.

A clear view of your funnel enables you to make data-driven decisions across the
whole sales and marketing environment, increasing sales and ensuring long-term
success. It also alerts you promptly if the sales and marketing teams are out of sync
and where the issues may be.
Aligning your sales and marketing teams is more than just good business practice.

Conclusion

It is a step that will put you in a better position to succeed in an ever-changing

market.
Bibliography
Aaker, A.D., (2007). Strategic market management, John Wiley & SONS, Inc.

Forbes Agency Council (2022). 15 Top Trends That Will Impact Marketing In 2022,
Available at, https://www.forbes.com/sites/forbesagencycouncil/2022/01/14/15-top-
trends-that-will-impact-marketing-in-2022/?sh=264dc59f6f0c, [Accessed 02 February
2022]

Jain S.C. (2000). Marketing Planning & Strategy, Cincinnati, Thomson Learning.

Kotler, P., (2004). Marketing Management: Analysis, planning, implementation and

control, New Jersey, Prentice Hall Pearson Prentice Hall.

Lamb, Charles W., Hair, Joseph F., McDaniel, C., (2007). Essential of Marketing,
South-Western Publishing.

Mullins, J., Walker, O., (2005). Marketing Management: A Strategic, Decision-

Making Approach, 5/e, Mcgraw-Hill.

Richard M. S. and Wilson, Colin. (2005) Strategic Marketing Management: Planning,

Implementation and Control, Elsevier Butterworth-Heinemann Amsterdam.

Seturi, M and Urotadze, E. (2017). About Marketing Process Model and Relationship
Marketing, Available at,
https://www.researchgate.net/publication/313561456_About_Marketing_Process_Mo
del_and_Relationship_Marketing, [Accessed 02 February 2023]

Zait, L. (2009). The process of marketing management – between the management

marketing activities and the operational marketing, Available at,
https://www.researchgate.net/publication/46534113_The_process_of_marketing_ma
nagement_-
_between_the_management_marketing_activities_and_the_operational_marketing,
[Accessed 02 February 2023].