DPR/37215/2015

DBM 1211 : PRINCIPLES OF MARKETING 1

CAT 1

Question 1:

What is meant by marketing? And Explain the nature and scope of marketing

Marketing is the process of identifying, anticipating, and satisfying customer needs and wants
through the creation, promotion, and distribution of goods and services.

The nature of marketing is dynamic and constantly evolving to keep up with changes in
consumer behavior, technology, and the competitive landscape. It involves a range of
activities such as market research, product development, advertising, sales promotion, public
relations, and customer service.

The scope of marketing is vast, covering everything from small businesses to multinational
corporations, and encompassing a wide range of industries and sectors, including goods and
services, consumer and business markets, profit and non-profit organizations, and domestic
and international markets. Marketing has several dimensions, including product marketing,
service marketing, brand management, digital marketing, and social media marketing.

The primary aim of marketing is to create value for customers, and it involves building
relationships with customers through effective communication and engagement. The scope of
marketing also includes understanding customer needs and preferences, conducting market
research, analyzing customer data, and leveraging insights to develop effective marketing
strategies.

Marketing is a critical business function that helps companies build brand equity, increase
market share, and drive revenue growth. It plays a crucial role in creating and sustaining
competitive advantage in today's global economy, where companies must constantly adapt to
changing customer needs and market conditions.
Question 2:

Explain the competing marketing concepts/philosophies that guide the organization

orientation toward the market place

There are several competing marketing concepts or philosophies that guide an organization's
orientation toward the marketplace. These include:

Production Concept: This concept holds that customers will favor products that are widely
available and low in cost. Therefore, organizations focus on maximizing production and
distribution efficiency to keep prices low and make the product widely available.

Product Concept: The product concept holds that customers will favor products that offer
the most quality, performance, and innovative features. Organizations that follow this
philosophy focus on continuous product improvements and innovations to make their
products superior to others in the market.

Selling Concept: The selling concept holds that customers will not buy enough of the
organization's products unless it undertakes a significant selling and promotion effort.
Therefore, organizations that follow this philosophy focus on aggressive selling and
promotion to create a demand for their products.

Marketing Concept: The marketing concept holds that the key to achieving organizational
goals is to identify and satisfy the needs and wants of target customers more effectively than
competitors. Organizations that follow this philosophy focus on understanding customer
needs and wants, developing products that meet those needs, and delivering superior
customer value through effective marketing.

Societal Marketing Concept: The societal marketing concept holds that organizations
should deliver value to customers in a way that maintains or improves both the consumer's
and society's well-being. Organizations that follow this philosophy focus on developing
products that not only meet customer needs but also consider the long-term impact on society
and the environment.
Question 3:

Differentiate among Needs, Wants and Demand?

Needs, wants, and demand are important concepts in marketing that refer to different aspects
of consumer behavior. The main differences between them are as follows:

Needs: Needs are the basic requirements for survival and well-being. They are the things that
people must have in order to sustain life and meet their biological, physical, and emotional
needs. For example, food, water, shelter, and clothing are all basic needs.

Wants: Wants are the desires that people have beyond their basic needs. They are shaped by
personal preferences, cultural influences, and social norms. For example, a person may need
a car to get to work, but they may want a luxury car for the status and prestige it brings.

Demand: Demand refers to the willingness and ability of a consumer to buy a particular
product or service at a given price. In other words, demand is the manifestation of a want in
the marketplace. It depends on the consumer's income, tastes, preferences, and the
availability of alternatives. For example, a person may want a luxury car, but they may not be
able to afford it or may choose to buy a less expensive car instead.

Question 4:

Explain the marketing goals which a firm may aim at achieving through its marketing
activities

Marketing goals refer to the specific objectives that a company sets for its marketing efforts
to achieve. These goals may vary depending on the type of business, industry, and market
conditions. They include;

Increasing Sales: One of the primary marketing goals for many firms is to increase sales of
their products or services. This can be achieved by attracting new customers or by
encouraging existing customers to buy more frequently or in larger quantities.

Building Brand Awareness: Another important marketing goal is to build brand awareness
and recognition. This can be done by creating effective branding strategies that make the
company's products or services more visible and memorable to target customers.
Developing Customer Loyalty: Firms may also aim to develop customer loyalty by creating
positive experiences and building strong relationships with customers. This can be achieved
through effective customer service, personalized communication, and loyalty programs.

Expanding Market Share: Firms may aim to expand their market share by increasing their
share of sales in their existing markets or by entering new markets. This can be achieved
through effective market research, product development, and promotion strategies.

Enhancing Customer Satisfaction: Another marketing goal is to enhance customer

satisfaction by providing high-quality products or services that meet or exceed customer
expectations. This can be achieved through effective product design, quality control, and
customer feedback mechanisms.

Maximizing Profitability: Firms may aim to maximize profitability by increasing revenue or

reducing costs. This can be achieved through effective pricing strategies, cost management,
and promotion activities.

Question 5:

Some of the Marketing Environmental forces are controllable whereas the others are
beyond the control of a firm – Discuss

The marketing environment refers to the external factors and forces that influence a firm's
marketing activities and decisions.

Controllable marketing environmental forces are those that can be influenced or

controlled by the firm. These include the marketing mix elements such as product, price,
promotion, and distribution. The firm can adjust these elements to respond to changes in the
market and meet the needs and wants of the target customers. For example, a company can
adjust its product features, pricing strategy, promotional activities, or distribution channels to
better match the needs of the target market.

Uncontrollable marketing environmental forces, on the other hand, are those that are
beyond the control of the firm. These include factors such as economic conditions,
technological changes, political and legal factors, social and cultural factors, and competitive
forces. These factors can have a significant impact on a firm's marketing activities and
decisions, but the firm cannot directly control or influence them. For example, a company
cannot control economic conditions, such as recessions or inflation, but it can adjust its
marketing strategies to respond to changes in consumer behavior resulting from such
conditions.

The key challenge for firms is to identify and analyze the environmental forces that are
controllable or uncontrollable and develop effective strategies to respond to them.
Controllable factors can be leveraged to gain a competitive advantage, while uncontrollable
factors must be monitored and addressed through effective risk management strategies. By
understanding and responding to both controllable and uncontrollable environmental forces,
firms can develop effective marketing strategies that meet the needs of their target customers
and achieve their marketing objectives.

Question 6:

Consumer buying behavior influences how consumers buy. Discuss the factors that
influence the buying behaviour.

Consumer buying behavior refers to the process that individuals go through when purchasing
products or services.

Cultural Factors: Culture refers to the shared beliefs, values, customs, behaviors, and
artifacts that characterize a group or society. Cultural factors play a significant role in shaping
consumer behavior, as individuals' preferences, attitudes, and behaviors are often influenced
by their cultural background. Cultural factors include sub-cultures, social classes, and cultural
norms and values.

Social Factors: Social factors refer to the influence of family, friends, and other social
networks on consumer behavior. Social factors can affect consumers' attitudes, beliefs, and
behaviors, including their product preferences, purchase decisions, and brand loyalty. Social
factors include family, reference groups, social class, and culture.

Personal Factors: Personal factors refer to the characteristics of the individual consumer that
influence their purchasing decisions. Personal factors include demographic factors such as
age, gender, income, and education, as well as personality traits, values, and lifestyle.

Psychological Factors: Psychological factors refer to the individual's internal mental states
that influence their behavior. Psychological factors include motivation, perception, learning,
beliefs, and attitudes. For example, an individual's motivation to purchase a product or
service can be influenced by their personal needs and desires, while their perception of a
product's value or quality can be influenced by their beliefs and attitudes.

Question 7:

Discuss the stages of the adoption process and outline the factors that can influence the
rate of adoption

The adoption process refers to the stages that consumers go through when they adopt a new
product or service. The adoption process can be divided into five stages:

Awareness: The consumer becomes aware of the new product or service, either through
advertising, word of mouth, or other marketing efforts.

Interest: The consumer becomes interested in the new product or service and begins to seek
out more information about it.

Evaluation: The consumer evaluates the new product or service by comparing it to existing
alternatives and considering factors such as price, quality, and value.

Trial: The consumer tries out the new product or service to see if it meets their needs and
expectations.

Adoption: The consumer decides to adopt the new product or service and begins to use it
regularly.

Several factors can influence the rate of adoption, including:

Relative Advantage: The degree to which the new product or service is perceived as better
than existing alternatives.

Compatibility: The degree to which the new product or service is compatible with the
consumer's lifestyle and values.

Complexity: The degree to which the new product or service is perceived as difficult to use
or understand.

Trialability: The degree to which the new product or service can be tried out or tested before
a full commitment is made.

Observability: The degree to which the benefits of the new product or service can be
observed and communicated to others.
CAT 2

Question 1:

How are services different from products?

Services and products are both types of offerings that businesses provide to customers, but
there are several key differences between the two.

Intangibility: Services are intangible, meaning that they cannot be seen, touched, or felt in
the same way as products. Products, on the other hand, are tangible and can be physically
held and inspected.

Perishability: Services are often perishable and cannot be stored or inventoried like
products. For example, a restaurant cannot store a meal for later sale. Products, on the other
hand, can be stored and sold at a later time.

Heterogeneity: Services are often more variable and can be more difficult to standardize than
products. This is because services are often customized to meet the specific needs and
preferences of individual customers.

Inseparability: Services are often produced and consumed simultaneously, which means that
the customer is often involved in the production process. Products, on the other hand, are
typically produced and then sold to the customer.

Ownership: Products are often owned by the customer once they are purchased, whereas
services are not owned by the customer.

Question 2:

Discuss the various ways through which markets can obtain intelligence and market
research information

Market intelligence and research are critical components of any successful marketing
strategy.

Surveys: Surveys are one of the most common methods of collecting market research
information. Surveys can be conducted through a variety of channels, including online,
phone, and mail.
Focus Groups: Focus groups are small groups of people who are brought together to discuss
a specific product or service. Focus groups are used to gather opinions and feedback from
potential customers.

Customer Interviews: Customer interviews involve speaking directly with customers to gain
insights into their needs, wants, and opinions about a product or service.

Social Media Monitoring: Social media monitoring involves monitoring and analyzing
social media platforms to gain insights into customer opinions, preferences, and behaviors.

Competitor Analysis: Competitor analysis involves gathering and analyzing information

about competitors to gain insights into their strengths, weaknesses, and strategies.

Question 3:
Consumer buying behaviour is a process. Discuss the steps in consumer buying decision
process

Consumer buying behavior is a complex process that involves several stages. The steps in the
consumer buying decision process are as follows:

Problem Recognition: The consumer recognizes a problem or need that they want to solve
or fulfill. This need could be triggered by internal factors, such as a desire for a new product,
or external factors, such as an advertisement.

Information Search: The consumer begins to search for information about possible
solutions to their problem. This can involve researching products online, asking for
recommendations from friends and family, or visiting stores to examine products in person.

Evaluation of Alternatives: After gathering information, the consumer evaluates the various
options available to them. This could involve comparing different products based on price,
quality, features, and other factors.

Purchase Decision: After evaluating the alternatives, the consumer makes a decision about
which product to purchase. This decision may be influenced by factors such as availability,
price, and brand loyalty.
Post-Purchase Evaluation: After the purchase, the consumer evaluates their decision and the
product itself. This evaluation could be positive or negative, and can influence future
purchasing decisions.

Question 4:

The 21st century has witnessed the so-called ‘digital revolution’. Explain how recent
ICT developments have impacted the practice of marketing.

The digital revolution of the 21st century has greatly impacted the practice of marketing by
enabling new and innovative ways for companies to reach and engage with their target
audience. With the increasing prevalence of the internet and advancements in information
and communication technology (ICT), marketing has shifted from traditional forms, such as
television and print advertising, to more digital and online strategies.

The use of social media platforms, search engine optimization (SEO), email marketing, and
online advertising has become increasingly popular, allowing companies to target and reach
their audience more effectively. This has also led to the rise of influencer marketing and user-
generated content, which have proven to be successful in building brand awareness and trust.

Big data and analytics have also revolutionized marketing by enabling companies to gather
and analyze vast amounts of information about their customers, allowing for more
personalized and targeted marketing campaigns. Additionally, the use of virtual and
augmented reality technologies is transforming the way companies can showcase and
promote their products and services.

Overall, the digital revolution has provided a wealth of opportunities for marketers to connect
with their audience in new and innovative ways, and has become an essential component of
any successful marketing strategy.

Question 5:

Selling to organizational buyers can be challenging. Discuss the process involved in

organizational buying and differentiate the steps with those involved in consumer
decision making

Selling to organizational buyers can be more complex and challenging than selling to
individual consumers. This is because the decision-making process in organizational buying
involves more people and more complex criteria.
Problem recognition: The buying process starts with the identification of a need or a
problem that the organization needs to solve.

Information search: The organization then conducts a search to identify possible solutions
to the problem, often through research, networking, and consultations with experts.

Evaluation of alternatives: The organization then evaluates the alternatives based on criteria
such as price, quality, reliability, and compatibility with existing systems.

Purchase decision: Once the evaluation is complete, the organization makes a purchase
decision and selects a supplier or a vendor.

Post-purchase evaluation: Finally, the organization evaluates the product or service after the
purchase to ensure that it meets their expectations and needs.

On the other hand, the consumer decision-making process involves the following steps:

Problem recognition: Like in organizational buying, the consumer buying process starts
with problem recognition or the identification of a need.

Information search: The consumer then gathers information on possible solutions to the
problem, usually through personal research, recommendations, and reviews.

Evaluation of alternatives: The consumer evaluates the alternatives based on criteria such as
quality, price, and personal preferences.

Purchase decision: The consumer then makes a purchase decision and selects a product or
service that best meets their needs and expectations.

Post-purchase evaluation: Finally, the consumer evaluates the product or service after the
purchase to ensure that it meets their expectations.

One of the key differences between the two processes is the number of people involved.
Organizational buying usually involves multiple decision-makers and influencers, whereas
consumer decision-making is primarily influenced by personal preferences and experiences
Question 6:

Henry distinguished among different types of buying behaviour based on the degree of
buyer involvement and the degree of differences among products. Discuss these types of
behaviour

Complex buying behaviour: This occurs when there is a high degree of buyer involvement
and significant differences among brands. Consumers engage in extensive information
search, evaluate alternatives, and make careful decisions. Examples of products that typically
require complex buying behaviour include cars, homes, and computers.

Dissonance-reducing buying behaviour: This occurs when there is a high degree of buyer
involvement but little difference among brands. Consumers may feel some post-purchase
dissonance or doubt about their decision, but this can be reduced through positive
reinforcement or marketing efforts. Examples of products that typically require dissonance-
reducing buying behaviour include appliances and clothing.

Habitual buying behaviour: This occurs when there is a low degree of buyer involvement
and little difference among brands. Consumers tend to make repeat purchases of the same
product out of habit or convenience. Examples of products that typically require habitual
buying behaviour include groceries and personal care items.

Variety-seeking buying behaviour: This occurs when there is a low degree of buyer
involvement but significant differences among brands. Consumers may be willing to try new
brands or products in search of variety or novelty. Examples of products that typically require
variety-seeking buying behaviour include snacks and soft drinks.

Question 7:

Successful Marketing depends largely on a company’s ability to manage its marketing

programmes within its environment”. What is your understanding by “Environmental
Scanning”? and its importance to marketing activities.

Environmental scanning is the process of monitoring and analyzing the external environment
for changes and trends that may impact a company's marketing activities. The external
environment includes factors such as political, economic, social, technological,
environmental, and legal factors, as well as the competitive environment.
Environmental scanning is important to marketing activities because it helps companies
identify and adapt to changes in the market environment. By understanding the external
environment, companies can make informed decisions about marketing strategies, such as
product development, pricing, promotion, and distribution.

For example, if a company identifies a new technology that may disrupt its industry, it can
adapt its marketing strategies to take advantage of this trend, such as by investing in research
and development to create new products that incorporate the new technology. Alternatively,
if a company identifies a change in consumer behaviour or preferences, it can adjust its
marketing messages and channels to better reach and engage with its target audience.

Environmental scanning is a continuous process that requires ongoing monitoring and

analysis of the external environment. This can be done through various methods, such as
conducting market research, monitoring industry trends, analyzing customer feedback, and
engaging with stakeholders and influencers in the market.

In conclusion, environmental scanning is an essential part of marketing activities, as it

enables companies to stay ahead of changes and trends in the market environment, and make
informed decisions about marketing strategies. By managing their marketing programs within
their environment, companies can improve their chances of success and maintain a
competitive advantage in the market.