Holiday Work

Don't forget to complete the past papers for Buss1 and Buss2 Jan 2010!

See link Jan2010 past papers

Remember to practice chunky paragraphs!

MAKE CONNECTIONS USING EXAMPLES (DATA!)
USE CONNECTIVE STATEMENTS E.G. THIS MEANS THAT.........,, HOWEVER.....
MAKE LOGICAL ARGUMENTS USING STEPPING STONES

Scary Marketing Budget!

As predicted the internet went wild as Samsung unveiled its latest flagship handset, the Galaxy S4, at a glitzy event in New York. While the phone itself is certainly an improvement on its predecessor, it’s the marketing push behind it that will prove to be the mega blockbuster.

The marketing onslaught already began way ahead of launch, with the brand posting a series of teaser videos and graphics and even “leaks” online to build up excitement ahead of the big day.

And the big day certainly was big - it made Apple’s signature events look like a morning coffee meeting about paper by comparison. Samsung’s announcement was held at the humungous Radio City Music Hall, with the overspill crowd herded towards Times Square, where the company had erected an equally massive billboard. The day before, Samsung also assembled a smartly-dressed flash mob to perform for the New York City masses.

Of course it will be the next few days, weeks and months where Samsung really flexes its marketing muscle. Samsung spent about $401m to market its products in the US alone last year, compared with the $333m spent by Apple, according to Kantar Media.

Samsung will continue spending heavily on marketing in 2013 - it’s a strategy that helped the company overtake Nokia to become the biggest phone manufacturer in the world in 2012 and register record profit throughout the year.

Kantar predicts Samsung will spend $150m in advertising the S4 alone globally this year, compared with the $108m spent by Apple on marketing the iPhone 5.

Geoff Blaber, mobile device software research lead at CCS Insight, says its Samsung’s forthcoming “unrivalled” marketing campaign that will “deeply concern” the competition, rather than the actual device itself.

Marketing Mix (Place)

Distribution (Place) - Introduction

Source: www.tutor2u.net

Place (or its more common name “distribution”) is about how a business gets its products to the customers. 

It is one thing having a great product, sold at an attractive price.   But what if:

• Customers are not near a retailer that is selling the product?
• A competing product is stocked by a much wider range of outlets?
• A competitor is winning because it has a team of trained distributors or sales agents who are out there meeting customers and closing the sale?

Distribution matters for a business of any size – it is a crucial part of the marketing mix.

The objective of distribution is clear.  It is to:

To make products available in the right place at the right time in the right quantities

Distribution is achieved by using one or more distribution channels, including:

• Retailers
• Distributors / Sales Agents
• Direct (e.g. via e-commerce)
• Wholesalers

A distribution channel can be defined as:

"all the organisations through which a product must pass between its point of production and consumption"

Looking at that definition, you can see that a product might pass through several stages before it finally reaches the consumer.  The organisations involved in each stage of distribution are commonly referred to as “intermediaries”.

Place (Distribution) Powerpoint

Easyjet pricing

The low cost carriers have both penetrated and grown these markets, principally by garnering a consumer perception that the fares offered are very low.  This perception has been developed in no small part by extensive advertising and effective use of public relations.  For example, Ryanair has offered fares as low as one penny (plus taxes), and therefore it is not surprising that there is great media coverage of these carriers, which in turn generates more interest in the services.   Both Ryanair and EasyJet have been very effective in using media coverage of their legal wrangles with traditional carriers such as British Airways and Lufthansa to promote their services and low fares.  

Easyjet presentation

Pricing Strategies and Tactics

 

Posted in Business studies, The marketing mix

Businesses use a range of pricing methods when pricing a new product. Pricing strategies are used to achieve long term objectives for the business. Pricing tactics are used in the short term to achieve a specific objective.

Pricing strategies

There are 4 key pricing strategies commonly used by businesses

Price skimming

A product which is the first to enter a new market or new technologies will often use price skimming. This method involves pricing the product at a high price at launch, doing so allows companies to cover their research costs quickly. DVD players, XBOX and Plasma TVs are all examples of products which have used this strategy.

Penetration pricing

Penetration pricing is used typically used for products new to a well established market. Such a method involves pricing the product very low in order to gain market share and attract customers. New magazines will use this pricing strategy.

Premium pricing

A product which has a no or few competitors because the product has significant advantages may be priced artificially high in order to maximise profits. For example a flight on Concorde would have cost a lot more than a normal aircraft.

Price takers/Market price

This is where a product is priced at the same price as other products in the market. This strategy is used most commonly in food markets where all the products are the same

Pricing tactics

There are two key pricing tactics you need to be aware of:

Loss leaders

This is where a business will sell one of its products at a very low price, sometimes even at a loss. This is done in order to increase sells in other products which are being sold at a profit. This tactics is often used by supermarkets in order to attract customers into the store.

Psychological pricing

This involves pricing a product at a price which may seem lower than it really is. For example, car dealers usually sell cars at £15,999 or retail stores will sell products for £13.99.

Pricing

Pricing - introduction

Author: Jim Riley  Last updated: Wednesday 24 October, 2012

Marketing - What is price & pricing?

You come across the concept of price every time you buy something – whether it is in a shop, on the move or surfing online.

Price is:

• The money charged for a product or service
• Everything that a customer has to give up in order to acquire a product or service
• Usually expressed in terms of £ per unit

You can see from the above that price is not the same thing as cost.  

The price is the amount customers pay for a product.  The cost is the amount spent by a business making the product. However, as we see later, a firm needs to take account of the cost of production when setting price to ensure that it is making a profit on the products it offers.

The price a business charges for its product or service is one of the most important business decisionsmanagement take. 

For example, unlike the other elements of the marketing mix (product, place & promotion), pricing decisions directly affect revenues rather than costs.  

Pricing also has to be consistent with the other elements of the marketing mix, since it contributes to theperception of a product or service by customers.

Setting a price that is too high or too low will - at best - limit the business growth. At worst, it could cause serious problems for sales and cash flow.

So pricing is important, but it is really tough to get right.  There are so many factors to consider, and much uncertainty about whether a price change will have the desired effect.

Promotion

What it is
The ‘promotional mix’ is a term used to describe the set of tools that a business can use to communicate effectively the benefits of its products or services to its customers.
The promotional mix includes the following tools –

• advertising
  
• public relations
  
• sales promotion
  
• direct marketing
  
• personal selling
  
  Read the following article:
  promotionalmix.pdf 
  

Apple Product Life Cycles

Apple Product Life Cycles, the iPad, the iPhone and the iPad

 

The markets may have been disappointed with iPad sales in the final quarter of the year as sales fell back to 14 million units from the 17 million recorded in the third quarter but is this such a disappointment? For the year as a whole sales increased by 80% from 32.4 million to 58.3 million units.
The iPad has achieved cumulative sales of just under 100 million units in the first three years since launch. Compare this with the iPod with sales of just under 6 million in the first 1000 days and the iPhone’s 34 million units over a similar period, a quarter sales slow down is a minor setback. The launch of the iPad has been remarkable despite supply side constraints.

Interested in apple from the ipod to ipad then view the folliwng casestudy:
Apple Corporate Strategy Case Study



 

Apple Smart Watch

Apple describes a device which wraps itself around the user's wrist

Apple smart watch efforts confirmed by US patent

Continue reading the main story

Fresh evidence that Apple has been working on a smart watch concept since at least 2011 has emerged in a patent filing.

The document describes a flexible touchscreen display which would communicate with a smartphone or other electronic device.

It coincides with a report from a tech consultancy suggesting there is huge pent up demand for such a gadget.

But ABI Research warns that battery life issues still need to be addressed.

It says assuming such problems can be resolved, about 485 million wearable computing devices might ship by 2018, providing a significant growth opportunity for Apple and the wider consumer electronics industry.

Not all published patents lead to actual products, but Bloomberg, the Wall Street Journal and the New York Times have all published reports this month saying sources had confirmed Apple was experimenting with a watch-like device.

The Boston Consulting Group Matrix/ Product Portfolio Management

The famous BCG matrix classifies a firm’s product portfolio into four strategic business units (SBU): Stars, Question Marks, Cash Cows and Dogs.  Within each SBU, there are again four potential strategies to take: build market share, hold market share, harvest (reduce investment) and divest (phase-out).

Star:  This would be the iPad because it has a high share of the rapidly growing tablet market.  As the iPad is in its growth phase of the product life-cycle, the product is beginning to lose its first-mover advantage as other manufacturers begin to launch theirown tablet devices.  Hence, Apple should invest heavily into marketing the iPad in order to grow sales to maintain their share (sales need to grow at the same rate as overall market sales to maintain market share within a growing market).  But in the future, when market sales become stable, Apple should harvest the product to turn it into a Cash Cow to fund other SBUs.
Question mark: Despite Apple’s best attempts, PCs with Microsoft operating systems still continue to dominate the PC market.  Much of this is down to strong business-to-business marketing and high switching costs for businesses and consumers, alike.  Apple could potentially used three strategies for their Mac software:

1) Divest – this could allow Apple to devote more time on their most profitable products, but it is highly unlikely as the Mac is part of the firm’s brand identity.

2) Build – Apple could potentially invest lots and lots of resources to try to turn Macs into a star, however even with Apple’s huge cash pile, it is questionable if it is even possible to beat Microsoft-powered PCs.

3) Hold – this is the most likely strategy.  Apple will probably continue to develop new Macs and support existing customers, however investments will be kept at a minimum and be target towards the iPad.

Cash Cow: Apple’s source of steady flows of income are clearly the iPhone and the iPod; both the MP3 and mobile phone market have reached saturation and Apple has a high share of both these markets.

As the iPod is reaching the decline stage of the PLC, Apple is beginning to harvest the product.  That is, slowly reducing investment in marketing iPods to increase their profitability; by generating more cash, further investments can be made into question marks or stars.

In the future, Apple will probably only maintain their market share of the iPhone. It is a highly profitable to generate sales from existing customers from upgrades, which can be almost guaranteed after a consumer invests heavily in downloads from the app store.

Dog: Lastly, Apple TV – a device that allows media files in iTunes to be played on a TV – has never really caught-on.  By launching a second and third generation, Apple have shown they are committed to building sales.  However, unless the overall market for digital media receiver grows, it could be more profitable to divest the product.

Sony Playstation Launch

Full Article on the timeline of Sony Playstation 1-4

The history of the device is worth revisiting. PlayStation was launched in 1994, a fringe product created by renegade engineer Ken Kutaragi. His vision, he once told me, “was to create a new concept for computer entertainment — we wanted to include as much of the audience as possible, including females and seniors, East and West, North and South…. In our minds it was not a game machine, but a preparation for future entertainment.”

PlayStation 1 became a surprise hit, eventually selling 100 million, but the real game changer was PlayStation 2, released in 2000. That second iteration pushed the technology envelope with better graphics and faster chips than you’d find in a PC. It was also the first game machine with optical DVD storage. But Kutaragi’s larger vision was remaking and broadening entertainment. “Content itself is culture,” he said as he prepared to launch. That was part of the reason that he felt it imperative for new iterations of PlayStation to run previous software. “A new version PlayStation should create new forms of entertainment,” he said, but “we don’t want to throw away our history, it’s very, very clear that keeping compatibility is important.”

Product Portfolio Analysis

Simple explanation of Product life Cycle and Boston Matrix.  Slightly annoying accent and tonality but content is relevant.

Product Life Cycle

Product - the Product Life Cycle

Marketing - Product life cycles

The product life cycle is an important concept in marketing.  It describes the stages a product goes through from when it was first thought of until it finally is removed from the market. Not all products reach this final stage.  Some continue to grow and others rise and fall. 

The main stages of the product life cycle are:

• Introduction – researching, developing and then launching the product
• Growth – when sales are increasing at their fastest rate
• Maturity – sales are near their highest, but the rate of growth is slowing down, e.g. new competitors in market or saturation
• Decline – final stage of the cycle, when sales begin to fall

This can be illustrated by looking at the sales during the time period of the product.

A branded good can enjoy continuous growth, such as Microsoft, because the product is being constantly improved and advertised, and maintains a strong brand loyalty.

Extension strategies extend the life of the product before it goes into decline.  Again businesses use marketing techniques to improve sales.  Examples of the techniques are:

• Advertising – try to gain a new audience or remind the current audience
• Price reduction – more attractive to customers
• Adding value – add new features to the current product, e.g. video messaging on mobile phones
• Explore new markets – try selling abroad
• New packaging – brightening up old packaging, or subtle changes such as putting crisps in foil packets or Seventies music compilations

Source:www.tutor2u.net

New Apple products for 2013

Apple is constantly trying to push the envelope with its clear design, innovative technology solutions and strategic product launches. Here are a few future Apple products 2013 that the company could develop in the near future.

Malcolm Gladwell and Spaghetti Sauce

 

http://www.ted.com Tipping Point author Malcolm Gladwell gets inside the food industry's pursuit of the perfect spaghetti sauce -- and makes a larger argument about the nature of choice and happiness.

What is Marketing?

To help put things into context, you may find it helpful to often refer to the following diagram which summarises the key elements of marketing and their relationships:

Author: Jim Riley    Source:www.tutor2u.net
What is marketing?
There are many different definitions of marketing. Consider some of the following alternative definitions:

• “The all-embracing function that links the business with customer needs and wants in order to get the right product to the right place at the right time”
• “The achievement of corporate goals through meeting and exceeding customer needs better than the competition”
• “The management process that identifies, anticipates and supplies customer requirements efficiently and profitably”
• “Marketing may be defined as a set of human activities directed at facilitating and consummating exchanges”

Which definition is right? In short, they all are. They all try to embody the essence of marketing:

• Marketing is about meeting the needs and wants of customers;

• Marketing is a business-wide function – it is not something that operates alone from other business activities;

• Marketing is about understanding customers and finding ways to provide products or services which customers demand

 

The puzzle of motivation

Dan Pink challenges the notion that financial rewards motivate.

Jumping for the jelly beans

One of my favourite videos and makes some important points on motivation.

Training

The following video illustrates how you cannot make the best use of technology without training.
Methods of training should include: on-the-job, off the-job and induction.

Introduction to Training
Revision Presentation on Training
Starbucks Off-the-Job Training video

Recruitment and Selection

Developing an Effective Workforce: Recruitment, Selection, Training

• the recruitment process

• internal and external recruitment

• selecting the best employees 

• how recruitment and selection can improve a workforce

Recruitment Powerpoint
Recruitment Worksheet/Notes

Selection Powerpoint

Psychometric Test
Selection
Police Recruit News Article

Measuring the Effectiveness of the Workforce

Candidates should be able to calculate and
interpret measures such as labour productivity and
labour turnover.

Labour Turnover
Production efficiency
Measuring effectiveness of workforce ppt
Times 100 case study

Improving Organisational Structures

Improving Organisational Structures
• key elements of organisational structure
• workforce roles
• how organisational structure affects business
performance.

Key elements should include: 

• levels of hierarchy/spans of control
• work loads/job allocation
• delegation
• communication flows.

The workforce roles include: supervisor, team leader, manager and director.

Useful Links:

Organisation Structure Worksheet
Organisation Structure PPT
Organisation Worksheet Tutor2u
Times 100 Case Study Singapore Airlines
Crossword