Conflict between objectives can arise Within the marketing department

E.g. a price cut can make it difficult to increase expenditure

With the objectives of the other departments or functions…

Potential ConflictWith Accounting and Finance Aims to control costs – market research and promotion is very

expensive and impossible to accurately measure the returnWith HRM Marketing aims to create demand which leads to greater staffing

requirements, HRM prefer stability whereas the marketing department aims to stimulate change

With Production (Operations Mngt) Working together is essential – the marketing dept cannot

promise goods/services the production dept cannot deliver whereas the productions dept cannot create products/services there is no demand for (market research co-ordinated by the marketing dept solves this problem)

Customer OrientationThe firm considers what the public

want before trying to produce it

Product OrientationThe firm produces a product and then

tries to convince the public theywant/need it

Marketing Function Led Production Function Led

Analysing Approach

The pros and cons for each of the approaches to the business

Customer OrientationThe firm considers what the public

want before trying to produce it

Product OrientationThe firm produces a product and then

tries to convince the public theywant/need it

Market Segmentation

Market Segmentation and the reasons for

Market research identifies different groups (segments) of people within the market

These groups can then be targeted individually increasing the effectiveness of the firms marketing (e.g. promotional campaigns, product versions)

Increasing effectiveness means reducing cost and maximising return

Gaps in the market can be found Niche markets can be found (a smaller market within the whole

[mass] market made up of a specific segment of the market) Enhances the development of marketing strategies (plan to

achieve marketing objectives)

Breaking down a large market into subgroups or sections that are likely torespond to products in different ways

Ways to segment the marketGeographical Where people live. People from different areas of the country

respond differently to products.

Lifestyle Interests and hobbies and how these impact of the products they demand.

Age Firms often product numerous versions of the products which appeal to different age ranges.

Gender Products aimed at both genders can be specifically tailored through packaging or styling.

Social Class Occupations. However incomes and products purchased are not always in direct relation.

A (upper class: doctors, lawyers) – E (unemployed: pensioners, on benefits).

Residence Type of housing they live in. ACORN: A Classification of Residential Neighbourhoods. Allows firms to target those living in flats differently to those in large detached houses.

Behaviour Spending patterns. Certain groups behave differently on different days.