Professional Documents
Culture Documents
Marketing
Introduction
The focus of this topic is the main elements involved in the development and implementation of
successful marketing strategies.
Outcomes
The student:
H1 critically analyses the role of business in Australia and globally
H2 evaluates management strategies in response to changes in internal and external influences
H3 discusses the social and ethical responsibilities of management
H4 analyses business functions and processes in large and global businesses
H5 explains management strategies and their impact on businesses
H6 evaluates the effectiveness of management in the performance of businesses
H7 plans and conducts investigations into contemporary business issues
H8 organises and evaluates information for actual and hypothetical business situations
H9 communicates business information, issues and concepts in appropriate formats
Students learn to:
examine contemporary business issues
investigate aspects of business using hypothetical situations and actual business
case studies
Marketing is the most recognised of all business operations. It is through the process of
marketing that a business is able to develop a product and then implement a series of
promotional and pricing strategies aimed at encouraging a particular group of customers to buy
the product. These activities must be implemented within a legal framework seeking to protect
the interests of stakeholders within the marketing process.
Marketing allows a business to communicate with its customer base. This process involves
determining the features of a product, the types of promotional strategies to use and where
customers will be able to purchase the product.
A successful business is often one that is able to develop a long-term and valued
relationship with its customers. Businesses recognise that not all customers are the same.
People seek different products and services at different prices. It is important, then, that a
business understands who its customers are. It should examine why particular groups buy
the companys products and whether its marketing strategies are effective in developing
customer awareness and sales. It is through the process of marketing that all such activities
are achieved.
6
Role of marketing
Marketing is the process of developing Marketing
a product and implementing a series of
Strategic role The process of
of marketing developing a product and
strategies aimed at correctly promoting,
pricing and distributing the product to implementing a series
of strategies aimed at
a core group of customers. More than Choice
correctly promoting,
any other business function, it is the role pricing and distributing
of marketing to develop and implement the product to a core
strategies that generate revenue and group of customers.
Standard of living
sales for the business. While other
Standard of living
functions may make the product, it is
An individuals quality of
the responsibility of marketing to sell
life. It is partly based on
it. Marketing involves researching the Employment what goods and services
changing nature of consumers tastes and the individual can afford
preferences: what they like and what they to buy.
dont. The purpose of this is to determine
Brand awareness Strategic role of
what the business should be producing. marketing
It also involves the development of
Refers to the long-
products to provide consumers with an term role that the key
improved standard of living and greater business function of
choice within the marketplace. Marketing Market share marketing has within a
is also concerned with determining a business.
price that is consistent with consumers
Figure 6.1 The strategic role of marketing.
expectations and reflects the desired
image of the product or business. Choice
Marketing should consider the impact that An important feature of any business
price will have on the perceived quality environment is competition. Businesses
of the product and the ability of that compete to attract customers to purchase
price to sustain market share against its their products. To do this they must
competitors. differentiate their products from similar
products in the marketplace, otherwise
The strategic role of consumers would perceive the products
to be the same. In doing this, the business
marketing goods and must consider how to make its product
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Brand awareness
The federal and state governments have
A fundamental goal of any marketing
sought assistance from investors to develop
campaign is to increase a brands visibility
products that will improve consumers
within the commercial environment. Strong
quality of life. Many of the express
brand awareness allows a product to
motorways in New South Wales are privately
remain in the mind of consumers. This, in
owned; some hospitals are owned and turn, is likely to influence the consumers
operated by private companies. While there purchasing decision. Successful businesses
are generally higher fees attached to such are often those who have high brand
services, they have significantly improved the awareness from consumers.
quality of life of consumers. Examples of such Brand awareness is often achieved
services include the Mater Private Hospital, through strong and effective marketing
Crows Nest and Sydneys Cross City Tunnel. campaigns. Businesses make use of electronic
and print media to publicise their products.
Employment
Often when the term marketing is
discussed, people associate it with publicity,
pricing and advertising gimmicks. It is
important to remember that marketing
would not exist without a product or service
to sell. To provide a product to consumers,
a business must employ labour to assist
in the transformation process of changing
input resources into finished goods. It must
use the skills of this labour to research
innovative methods of improving and
enhancing the product. Some people are
required to sell the product. Marketing,
therefore, provides a source of income and
employment for millions of Australians each Figure 6.3 Australias two leading department
year. It is with this income that they are stores have sought to increase the awareness of
able to purchase the goods and services that their brands through the use of well-known and
satisfy their needs and wants. highly-publicised models.
The key
business
functions
Accounting
Marketing
and finance
customers. The pricing strategy used by resource market. Examples of businesses Industrial markets
the business must be able to generate that operate in the resource market are Where goods that are
a return on the funds invested by the BHP Billiton and Rio Tinto. Given that used as supplies in the
owners of the business to develop the labour is a key factor of production, it production process are
product. It must also be competitive and can be argued that labour is traded in traded.
affordable for those to whom the product the resource market. While much of
is targeted. the Australian labour force is regulated
through government legislation and
Activity 6.3 Comprehension tribunals, some employees are able to
negotiate higher wages based on their
1 Explain why businesses may benefit
ability, skill and reputation.
from using the production approach.
2 Outline the importance of promotion
to the selling approach.
Industrial markets
Industrial markets are where goods that
are used as supplies in the production
process are traded. It is unusual for a
Types of markets business to develop all the resources it
requires to produce finished goods. Toyota
The production and sale of goods and
Australia each year spends hundreds of
services is not restricted or targeted solely
millions of dollars for Australian companies
to consumers. Businesses purchase their
to supply Australian-made components for
supplies from other businesses to produce
Toyota vehicles manufactured in Australia:
goods and services that are then sold to
consumers. These goods and services Toyota Australias investment in
are known as inputs. Some organisations local suppliers forms an integral
simply buy a finished good from a component as part of the supplier
manufacturer to sell to consumers. Certain development overall strategy. This
businesses will choose to concentrate on initiative saw Toyota specialists
one section of the market, meaning they coordinate with selected suppliers to
specialise their products to a select group assess their processes and facilitate
of consumers. As can be seen, there is improvement activities. The
a diverse range of markets that demand consequent enhancements to supplier
goods and services. function allowed Toyota Australia
to continue their local partnerships
without the need to source from the
Resource markets
overseas market.
Resource markets are those markets
where the production and sale of raw Source: Toyota Motor Corporation Australia
materials occurs. Some businesses require website.
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Consumer
markets
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There are five key strategic roles of in the firm and society:
1 Choice: Marketing provides with choice. Businesses will often attempt to
themselves from their . They can do this through quality,
, service, packaging and loyalty programs.
2 Standard of living: Many of the products that businesses develop and market are aimed at
our quality of life and standard of . They do this by providing
goods that improve our and wellbeing, developing goods and services aimed at
making our lifestyles more and working with governments to distribute essential
services.
3 Employment: To provide consumers with a product to sell, a business must employ
to assist in transforming resources into a product. It also uses the
skills of this labour to and develop methods of improving this product. In this way,
marketing provides a valuable source of and to millions of Australians.
4 Market share refers to the of total sales a business has compared with its
in a particular market. The purpose of attempting to the market share
of a business is to increase the businesss sales and profitability.
5 Brand awareness refers to the extent to which consumers are of the existence of a
product, its features, price and possible stores of purchase. Strong brand awareness
allows a product to remain in the of consumers.
Short-answer questions
1 (a) Explain how a consumer market differs from the other types of markets in the business
environment.
(b) Describe and give examples of the three types of consumer markets.
2 Andreanna has decided to establish a homeware store. She believes that the quality of her
products, for which she has been recognised, will ensure the success of the business. Vanessa
is also opening a similar store but has conducted market research to develop a more thorough
understanding of her local area and their needs. Outline how the approach that Andreanna is
using differs from that used by Vanessa.
Extended-response question
Marketing is essentially aimed at selling the goods and/or services of a business. Describe what
is meant by the term marketing and explain, with reference to the different types of markets the
different types approaches to marketing businesses may use to market their products.