9609/12 Paper 1 Business Concepts 1 October/November 2023

6 (a) Analyze two reasons why there should be a close link between the marketing objectives of
a business and its corporate objectives. [8]

Marketing objectives are objectives set by a business and its marketing department to provide a
sense of focused direction for the marketing department and help the business to achieve its
overall corporate objectives.

There should be a close link between the business marketing objectives and corporate
objectives to prevent chances of conflicts between marketing and corporate objectives.For
example if the marketing department has different objectives such as lowering prices for
competitive pricing,this may not align with corporate objectives to generate profit.This will lead
to internal conflicts within the business.Therefore by linking both objectives the business
achieves a common objective .This ensures that marketing activities are consistent with the
overall strategic direction of the business which leads to business success in the market.

Additionally,the two objectives should be closely linked so that there are appropriate strategies
and tactics for the business.The main roles of the marketing department is to effectively promote
and sell its products/services to the target market.The marketing department requires the
support of the corporate objectives.When the two objectives are closely aligned,businesses can
develop marketing strategies and advertising campaigns that that effectively reach and engage
with potential customers.This increases the market share of the business by attracting loyal
customers for the business.

(b) ‘This new airline will only succeed if it offers the lowest prices in the market’.
Evaluate this view. [12]

The new airline business initial objective is to survive in the market and establish a strong
market presence that leads to the airlines being profitable.By offering low prices in the
market,the tickets for the airlines will be cheaper.For example,penetration pricing may be used
to lower prices initially then gradually increase the prices of plane tickets.This attracts more
potential passengers who are price sensitive to travel with the airlines in the short run.This is
due to the the lowest prices offered in the market.Therefore,making the new airlines more
competitive amongst other airlines and providing it a higher chance of success.

Moreover,by offering the lowest prices in the market the airlines can gain higher market
share.The low prices of tickets allows the airlines to attract a wider customer base than
competitor airlines.This can help to capture a higher portion of the market
and attract customers looking for the best deals due to increased demand.However,the low
prices offered may lead to customers to perceive the airlines as offering low quality.This view
may potentially lead to poor brand image and customer loyalty.This is because customers may
doubt the comfort of the services provided by the new airlines in comparison to those offered by
competitors,meaning less sales for the airlines.Therefore,making it difficult for the new airlines to
survive and grow in the market as the new airlines may struggle to retain customers in the long
term.

Additionally,if the new airlines in the market offers lowest prices,this may potentially lead to price
wars with competitors.The airlines business is highly competitive which is why if price wars
initiated by the new airlines,the competitors may respond to this .This will risk reducing the profit
margins for the new airlines.The business success is highly dependent on the profitability of the
business,therefore if low prices offered the profit earned is reduced.This will make the new
airlines not be able to generate sufficient revenue to cover all expenses of the airlines service
such as paying salaries to employees and the maintenance of machinery used in the airlines.

In conclusion,prices must be carefully considered in an airlines business especially because it’s

new business in the market.Potential travelers may be price sensitive,so lowest prices offered
by new airlines may enable a higher demand of the flight tickets.However,other factors have to
be considered other than prices such as ensuring quality service is offered.This is a significant
factor may lead to the success of the new airlines business.For example the flight attendants
recruited must be able to attend all types of passengers and provide them with comfort
throughout the flight as well as providing quality meals,reliable baggage handling and on time
departing.This will enhance customer satisfaction and build loyalty from customers leading to a
strong brand reputation in the market and making it differentiate from competitor airlines.This
allows the airlines to generate higher levels of revenue by its quality services.This will further
lead to attracting more customers for the airlines due to the positive brand image which gives
the new airlines chances for success and growth as well as a higher market share,