Segmentation, Targeting, and the Marketing Mix

Objectives 1

Describe the role of marketing in creating satisfying exchanges

Explain the role of advertising in communicating a products utility

Identify the various methods advertisers use to segment and aggregate consumer and
business markets

Objectives_2

Discuss how target marketing affects the firms advertising strategy

Describe the elements of the marketing mix and the role of advertising in the mix

Explain the purpose and importance of branding

Marketing and Exchange

The purpose of marketing is to create exchanges that satisfy the perceived needs and wants of
individuals and organizations
Consumer Needs & Product Utility
Utility is the products ability to satisfy both functional needs and symbolic wants

Market Segmentation

Identifying groups of people with similarities

One or more groups become target market

Hardees Thickburger campaign targets young men

Geographic Segmentation

Extending the Product Life Cycle

Marketing Communications
Factors important for advertising success

Strong primary demand

Chance for product differentiation

Hidden qualities of high importance to consumers

Opportunity to use strong emotional appeals

Substantial sums available to support advertising

The Economics Of Sport and Leisure

Content

Sport and Leisure industries

Demand and supply analysis of leisure events

Income elasticity of demand and leisure activities

Monopolies in the leisure sector

Exchange rates and the travel industry

Sport and Leisure Industries

The sport and leisure industries covers the following:

Holidays and travel

Film industry

TV

Theatre

Sports
Demand and Supply Analysis Of Leisure Events

Demand and supply interact resulting in an equilibrium price for leisure events

Generally the higher the price of the product / event the less is demanded

The demand curve shows an inverse relationship between price and quantity demanded

If price changes then you would move along the demand curve to calculate any change in
quantity demanded
Shifts in the demand curve for leisure events

Shifts in the demand curve for leisure events can be caused by:

Prices of other goods either substitutes (other leisure events) or compliments

Incomes

Tastes and fashions

Consumer expectations

Advertising

Population level and structure

These factors can enable the demand curve to shift to the:

Left (less demanded at each price)

Right (more demanded at each price)

For example fashion and tastes could change meaning rugby becomes more popular so
the demand for rugby increases shifting the demand curve out

The current performance of British teams and individuals influences the demand for
sporting events if British teams / individuals are doing well demand is likely to be higher

Supply of leisure events

The supply curve shows the relationship between price and quantity demanded

The supply curve generally slopes upwards at higher prices more is supplied

There is a positive relationship between price and quantity supplied

Shifts in Supply Curve

The following factors can cause a shift in supply:

Profitability of other goods / services

Technology

Costs of production / supply

Natural shocks

Social factors

Expectations of producers

Demand and Supply Curve and leisure events

The demand of leisure activities has increased in the UK as peoples incomes have risen

Changes in tastes / fashions and technology have also helped fuel the increase in demand

Since the 1960s people have been spending more time and more money on leisure
activities

Income elasticity of demand and leisure activities

Income elasticity of demand measures how responsive quantity demanded is to a change

in income

Generally for leisure activities demand is elastic so when income increases demand
increases by a greater proportion

This is because leisure activities are seen as luxuries

Income elasticity and leisure activities

Elasticity of specific activities is influenced by the following factors:

Number of substitutes many leisure activities have lots of substitutes if the price
of going to the cinema increases people may rent films or go bowling instead

The % of income spent on the product if leisure activities are relatively cheap e.g.
the cinema they are likely to be more inelastic than more expensive activities such
as holidays

Monopolies in the leisure sector

Monopolies are examples of market failure

In some sectors of the leisure industry there tend to be large companies that dominate the
market

This is apparent in the travel industry where travel agents are dominated by Thomas cook
and airtours in the UK

Cinemas also tend to be dominated by large companies such as the Odeon, vue and UCI

Monopolies in the leisure centre

The markets tend to be more like oligopolies in nature

This means that the firms often set prices which leaves the consumer with less choice

Exchange rates and the travel industry

Exchange rates influence the demand for holidays

If the is strong then the relative cost of going on holiday is lower and therefore demand
for holidays is likely to increase

The exchange rate between the and other currencies will influence the demand for
holidays to different countries

Recently the $ has depreciated in value against the therefore holidays to the USA are
cheaper and there has been an increase in demand for these

Why work in the Leisure Industry?

Olympics putting UK Leisure, Tourism and Hospitality in the spotlight

Widest possible choice of career and lifestyle.

Room to move up or across sectors and industries.

One of the UK's fastest-growing industries.

Flexible hours

It's fun! Where else do you get paid to ensure people have a great time?

Fitness Instructor Qualifications/Experience etc

Must be qualified or start as an assistant and complete work

based qualifications (also Apprenticeships in some Local areas)

Nationally recognised level 2 qualification giving entry

on the Register of Exercise Professionals e.g. Level 2

Certificate in Fitness Instructing

A first-aid certificate which includes CPR

May need lifeguard qualifications

Public liability insurance

If work with children or vulnerable groups, need a Criminal Records Bureau (CRB)
clearance

Fitness Instructor Average Salary

Starting salaries: 10 - 12,000 per year

May rise to from around 14,000 to over 20,000

On the job training plus chance to gain qualifications, performance related pay, discounts,
childcare vouchers, REPS registration paid etc.

Freelance instructors can earn between 10 and 20 per hour