Section One

Task 1

a. Using examples as appropriate, explain both the relationship between and the differences between strategic marketing and tactical marketing. [AC1.1]

“marketing is a human activity directed at satisfying needs and wants through exchange processes”-kotler

Role of marketing:

Strategies were evidently well – defined, decisive and aggressive. Not losing any sight of new opportunities, they time their chances in the market. Role of marketing deals with two types namely marketing management and strategy marketing. Strategy marketing is concerned with extensive strategic decisions made at corporate and business levels, whereas marketing management deals with specific strategy decisions for products and activities needed for day to day life to develop the strategy efficiently. Marketing plays a chief part in strategic planning for most organizations. In spite of the fact that some marketing positions are positioned at the corporate level, the majority are functioned in business level. Following four are considered to be the most important factors of marketing.

Marketing mix Value chain Segmentation Positioning

Differences and links between strategy and tactical marketing:

Strategy marketing Tactical marketingFuture (long term)Preparing and planningA journeyBroad perspectiveA purposeAnticipation ( proactive)Risk

Now (according to the situation )Doing activitiesA trip Narrow perspectiveA taskReaction Caution

Strategy is the long term and mission of the organization but whereas the tactical marketing is a situational oriented marketing. The major link between strategy and tactical marketing are, tactical marketing gives a little push for the long term strategy to standardize the product or to compete with global competitors. For an example during the time of akshayathridhi people won’t prefer to buy gold or any jewels, understanding the situation marketers advertise those by giving an offer up to certain extent moreover they advertise with the help of astrologers saying that ‘if you buy a jewel in this akshayathridi it will get double in forthcoming year” . This was consider to be the tactics they used to attract customers and to run the business smoothly even in the crisis phase. Tactics is the gentle push for the long term strategy marketing.

b. Explain the main activities involved in strategic marketing. In answering this question you may want to give examples from one or more organisations with which you are familiar. [AC1.2]

Marketing planning processes Strategic marketing analysis:

The terms used to define the processes of setting organizational goals and accomplishing them have significantly in recent years, with the unavoidable difference in terms used in older texts. Strategy launches the long term objective whereas planning is a short term action program.Mission policy should mention clear cut objective about the organization. It should mention where we are now and to where we are going to be at this financial year. For that collective information should be carried out. The tool used to measure is SWOT analysis. The SWOT analysis measures the strength, weakness, opportunity and threats. In that strength and weaknesses are internal. Opportunity and threats are external factors that deals with competitors, market range , sustainability etc,.The long term objective also determines financial, customer, operations and peoples required. For an effective organization the horizon was set at high level view.

There are few variables influence the decision taken on marketing planning. They are Product strategy and planning Market strategy and planning Pricing strategy and planning Promotional strategy and planning

Physical distribution safety and planning

Short term goals:

For achieving long term objective it should cut halves/pieces into short term goals. These short term goals must be SMART

S -specific M –measurable A –actionable/achievable R –responsible/realistic T –time bound

Perceptual mapping:

Perceptual mapping is a commonly used tool that provides a technique of explaining the complex relationship between competitors in market place and the measures used by customers when they are making purchase decisions and sanctions.

Perceptual mapping may be used for market segmentation, idea development and assessment.

c. Define corporate strategy and evaluate the contribution which strategic marketing can make to corporate strategy. [AC1.3]  

The overall scope and direction of a corporation and the way in which its various operations work together to achieve particular goalsCorporate strategy focuses mainly on profitability and it includes creating an organizational structure, reducing debt and to improve the balance sheet of the company. They focus on external factor. Corporate strategy and strategy marketing often coincide and sometimes overlap from one another. Major focus of marketing includes planning activities like developing and pricing a product. But corporate strategy doesn’t deal with internal development of the organization. Its focuses more on profitability and getting market shares.

Task 2a. Present and assess a range of models for use in strategic marketing planning [AC2.1]

MODELS:The primary goals, or objectives, of the organization are the starting point of promotion planning. These goals act as signposts from which marketing strategies are established. Goals will differ amongst the organizations, but usually focuses on market share, profitability, sales and investor value. In most cases objectives are measurable.

Types of models: Porter’s five force model PEST or STEEPLE analysisBCG matrixThe Ansoff matrix

BCG matrix: BOSTON CONSULTING GROUP

The BCG matrix was created by the Harvard business school, is a easy model that studies the joint criteria of market growth and market share.

Market share

High low

High

star Question mark

Cash cow dog

Market growth rate

low

Stars are strategic business units (SBU) with a market share of a high growth industry. They have right earning potential. It is likely that the product is pricey to maintain initially in its life cycle. This may mean that an aggressive marketing effort is required, with the associated high advertising cost.

CASH COWS have a big market share from a slow, or zero, growth market. Generally they will have loyal customers, with the consequence that product development costs are quite low. They are profitable and trust worthy products, which will let a company to develop a strong portfolio

STARS often move into this place when the overall market has become established

QUESTION MARKS arise when the potential for market growth is decent, but they have a relatively low market share. The market is likely to be very competitive with SBU taking only limited impact. Considerable amounts of cash may need to be spent on advertising or research. These are also known as ‘PROBLEM CHILD’

DOGS are defined by low market share and low growth , these are SBUs facing possible liquidation. Usually they will continue to happen because of nostalgic reasons on the part of administration. They are likely to be one to be liquidated in the event of financial problems. However, they may survive as part of a marketing product mix

THE ANSOFF MATRIX: This well known model is a classic in strategy building. Its basic purpose is to analyze the company’s approaches to its products and to its markets to guarantee that an effective marketing plan is being pursued and possibly to reveal opportunities.

Current products new products

Current

Markets

New markets

MARKET PENETRATION:Current products in current markets –the plan here will be to rise the share of the market which the product or service at present enjoys. The risk factor is relatively low for the business because it knows the markets and the products.PRODUCT DEVELOPMENT:New products in current markets – this could mean absolutely new products or iterations of other products to make them more appropriate to the known market. The advantage to the business is that if the new products are successful, the cost of marketing a wider range of products to the market is less in relation to the larger profits generated. The risk involved here is that new products can have a high failure percentage. MARKET DEVELOPMENT:Current products to new markets – here the approach is to expand the markets beyond those in which current products are sold. The major advantage is longer product runs, hence probably lesser products. The main determinant of risk here is the cost of market entry. It is also likely that the business knows about the behavior in the new market and perhaps less about the competitor behavior in that market.

DIVERSIFICATION:New products to new markets – this is the maximum risk strategy of everything and is usually only pursued after a great amount of market research. From time to time it becomes the reason behind an acquisition where expertise is being bought to lessen the strategic risk.

b. Explain what is meant by strategic positioning. With reference to the particular strategic positions discuss what marketing tactics might be used to help achieve that strategic position. [AC2.2]

Market penetration Product development

Market development Diversification

Strategic positioning begins with a detailed declaration of what the organization wants its customers to think and feel about its customers to think and feel about its products or services. The customers do essential to see the plan, but everybody in the organization involved should have a sound understanding of the strategy’s purpose and goals.

Strategic positioning must consider these three golden rule of positioning they are PROJECTION, PREDICTION & FORECAST Projection is the outcome of simple techniques to recognize the market trends and season.Prediction is the effect of using more powerful analytical techniques to recognize factors linked with past sales, and developing estimates.Forecast is the outcome of merging the statistical projections or predictions with market information for the best outcome result There are few marketing tactics that are used to achieve the strategic positioning of the product. PRODUCT TACTICS:The key product tactics are selection, ranging, quality and brandingIn selection process, the vital decision is to select the correct product or service for the situation. This will help us to gain more profit. Range: broadening the product portfolio is frequently seen as a successful parameter so as long as it doesn’t stretch the organizational resources. If the product was not in the particular range then there is a danger of shifting of customers to another dealerQuality: nowadays quality remains the substantial tool and customers heavily relying on the quality of the product. Striving for the highest probable quality will take pressure off the marketing strategy and attract more customers in the long term.Branding: it is an essential tool to attract customers. Branding aims include distributing the message evidently, motivating buyers and loyalty

PRICE TACTICS: There are number of diverse tactics that can be adopted that involve price. Penetration pricing: the price ste for products is set pleasingly low in order to gain market share. Once achieved, the price will return to predictable level.Psychological pricing: prices are set to appeal to customers, usually just under a significant cost level example $35.99, 999 rupees.Promotional pricing: promoting a product through the use of buy one get one free type proposals

PROMOTION TACTICS: Typical promotional tactics include the use ofMarketing: print advertisement, direct mail, outdoor advertisement, etc,

Promotional activities: sponsorship events, involvement in projects, free coupons, gifts etc.Media relations campaign: planned to target members of the media for the advantage of the organization, public service statements and editorial in magazines.

PLACE TACTICS:This comprises of distribution networks, transport management, stock and handling and terms of delivery.

c. Explain what is meant by ‘relationship marketing’. Using examples as appropriate assess how effective relationship marketing can help achieve a given marketing strategy. (in answering last part of this question you should identify one or more strategic marketing objectives and evaluate how you would aspects of relationship marketing to help achieve your chosen objectives(s).

Relationship marketing : The idea of relationship marketing involves the use of lasting relationships with customers in order to retain them. Businesses needed to fulfill the customers expectations for satisfaction so that they are able to develop a strong relationship with their customers. Transactional marketing usually involved a focus on all of the promotional efforts aimed at drawing the customer for single sales. However, customers who remain loyal normally spend in long term, therefore it makes total sense to keep existing customers satisfied. Examples of how effective relationship marketing is achieved: In common the marketer’s uses suggestion box, focus groups, general comments, personal interviews, customer complaint handling and online surveys are used as a tool.Suggestion box are used to achieve good relationship with the customers. It is also like a written feedback form where it includes how the quality of the product, service, behavior of the sales person etc. most of the organization following this suggestion box idea for their betterment of having good relationship with the customers. For an example: if we buy any product from the well esteemed sports shop they will ask us to fulfill the feedback which includes name, DOB, E-mail, contact no, personal feedback. It may sounds little but they will send free birthday vouchers, offers etc. it will encourage the customer to stay loyal for the respective brand and to create some good relationship. This is a two way win-win strategy. Success in business without losing customer support. Marketers believe in word by mouth as a verdict for the business.

Section two:

For this particular section of the assignment you need to select a market or industry and also if ideally an organization within that industry/market. You need to undertake substantial research on that industry or market and also if possible upon the organization within it. This research needs to be based upon real statistical, economic, market and/or organizational data. This data should be significant.

Task 1

a. Select a specific industry or market and, based upon the research, discuss growth opportunities in that market or industry. You should demonstrate how the growth opportunities you select can be justified in terms of the research you have carried out (AC3.1)

For this particular task have selected automobile sector in specific

Audi Cars of 1970s• Audi 80 (1972–1978)• Audi 80 (1978–1986)1980s• Audi Quattro (1980–1991)• Audi 90 (1984–1987)• Audi 90 (1986–1991)

Audi allroad quattro (2000–2005)• Audi A4 Cabriolet (2005–2009)• Audi TT (2006• Audi Q5 (20082010sAudi A8 (2010• Audi A7 2010Grwoth Rate of Audi :

•

Sales for AUDI

In April

Cumulative

  2014 2013Change from 2013

2014 2013Change from 2013

World 149,050133,495+11.6%561,900 502,989+11.7%

Europe 71,150 65,496 +8.6% 271,500 253,064+7.3%

  - Germany

25,503 23,411 +8.9% 91,961 82,527 +11.4%

  - UK 12,630 10,205 +23.8%56,301 49,447 +13.9%

  - France5,691 5,648 +0.8% 20,272 20,189 +0.4%

  - Russia 3,660 3,651 +0.2% 11,946 11,929 +0.1%

USA 15,653 13,157 +19.0%50,881 47,343 +7.5%

China  45,216 38,710 +16.8%169,736 141,520+19.9%

In the recent years automobiles industry was increased highly. Now a days Audi is looking to develop new innovative product against the competitor. From past to this current market automobiles are changed in technology , design, capacity etc. Customers starts buying luxury cars are increased. Customers are well educated and they know all the information about the product . The customers collects various information from the various sources .So the industry need to perform more to satisfy the customer needs. Competitors are high in the automobile industry and also often changing trends are also affects for the industry.

TOTAL SALES : Audi sold 2270 cars to become the second largest luxury car manufacturer in the country. According to Audi cars sales it achieves a new sales record of 360,760.The profit is € 478 million. Only Audi industry achieves double digit sales growth 23.7% across the world.

Future Plan : In future Audi has a plan to launch new 10 model cars. These cars includes luxury, user and environment friendly etc. Even though cheaper cars are available in the market but customers like to buy this luxury cars because of best quality , best performance and feel good factor. The customers expectations are high so that best performance are needed by industry to use the new type of technology and more. It is also essential to provide good after sales service and placing new safety technology in cars.

B ) Marketing Objectives :

Audi India as a company in no.1 position in India and 2nd among world. this has made competitors down. This how a company should plan its strategy by developing products which are high on quality and will suit customer needs. Audi’s marketing strategy, right product at the right time has satisfied many customers. Sales are increased by attracting customers and developing strategies and achieve the targets From the annual report of Audi it shows that total revenue was reached by 29..billion and net profit was 1.35 billion. Focusing on customer needs and satisfying is required. So that deep analyze of information about customer is followed. For that Industry need to research about the Audi has done a promotional mix to empower their product. They have followed many ways to attract the customer. After analyze with sales team audi decided for promotion and also the awareness of the brand through :

Print Advertisement :

Audi starts advertisement in newspaper. It includes attractive offers , price and various schemes. Audi believes that it create brand awareness for the product. Different types of ads are given in different newspapers according to the region.

Displays:

Audi allows customers to get the experience of cars manually .It Organizationizes displays for cars in various places.

SMS & -Emails Facilities :

SMS and E-mails are were send to the customers on birthdays, festivals etc. so that customers can keep in touch with brands

Audi driver magazine:

Audi Driver magazine which includes information about the Audi cars technically, current issues, latest news, full index a-z, buying selling of cars etc. And also Audi has own mobile application. In that also we can get all information about the product,

C ) AUDI :

Every industry produce product with high quality and need to satisfy the needs of the customer. Sells cars at affordable price increases the market profits and sales.Marketing of product with proper advertising.

POTERS FIVE FORCE MODEL

Substitutes:-

The customers and marketers doesn’t think about substitute for Audi because it is very strong brands image in the world. Threats of subsides may arrive from car manufacturing company. And also threats from government like fuel , pollution free cars .But audi follows strategies and more people like it.

Competitors:- Automotive industry has higher competition. Because many giant companies who are offering luxury cars. And they are equally competitive. Now there is only competition between others companies like BMW, Benz etc in latest technology and product differentiation and also attracting customers and also offers pollution free cars with high quality . Audi is developing in the Laser light concept and shooting brake concept.

Buyers:- Attracting customers is the only way increase the revenue and sales. For this marketing and advertising is used by audi. Now a days customers get all the information about secondary dates like magazines , newspaper, internet. So that customers get some information about buying of product. All these information are increased and it become bargaining power of customers. For that audi try to attract the customers by offering discounts and giftsand after sales and serives.

Suppliers:-

More number of suppliers shows lot of interest in supply of materials to certain companies who produce quality products. Audi has more concentration on quality of product. Audi directly influences suppliers profits and its business. Company gets all the raw materials from the suppliers . lack of delay will affects the delivery of products to the customers. Audi not only concentrate in consumers and also suppliers in terms of quality.

Barriers to entry:-

Entering into automobile industry was very difficult and also it is difficult to compete in the existing companies. First of all when you enter into automobile industry you need to have huge amount of capital ,skilled laborers, engineers. And also need spend more money in advertising.

Not all the companies take the risk but Audi had taking the risk because they had a skilled lab laborers, engineers, and laborers..

TASK 2

a) Marketing mix of these enables the organization satisfy the requirements of customers

ProductAudi produces cars with high quality. the company must be in high level in technologies

such as, safety, comfortable and economy and user friendly. Audi extend the warranties for the product. It also called as product differentiation. The industry needs to develop a different range of products for the needs of the various customers.

Price

The price for the Audi cars is average in the market, Audi plays a balance between price and quality of the product. For example, Benz’s, BMW cars are more costlier than Audi cars, but all are similar. Audi adopt differentiated pricing and offer and discounts to attract the customers.

Place

Audi products satisfy all the type of the customers. Show rooms are setup in different places to reduces the lead time for sales and services

Promotion

Every automobile industry promote the industry in car racing. And also racing is the best way to show the customers how the cars is faster and better than competitors. Audi also engaged in these type of promotion. Audi’s latest promotion type was advertising in newspapers and magazines.

Physical Layout :

Physical layout is the place to visit the stores., today consumer needs to know all the information so that they have the high level of expectation. So that proper layout are designed and allow the customers to find them around the store.

Processes

There are number of process involved make the marketing organization ion effectively. Ex. Process of analyzing customers complaints, Know about customer needs and wants, Process of handling etc.

b) Strength and Weakness of the Industry :

STRENGTH :

Brand Loyalty is the strength for the Audi. And also it has international standards. The brand launches new innovative models

Both petrol and diesel variants are available Latest technology are used and it launch new latest cars like Quattro with engine

performance Provide employment opportunities. 40,000 employees working in Audi industry. Wider and innovative thinking. Strong R&D Safety with High quality

Weakness :

High maintenance & High handling cost Does not operate in huge scale. High class market.

Difficult to handle in the post purchase phaseOpportunities :

Emerging new markets. Positive impact of Foreign Direct Investment. Loan option will extended Expanding automobile market

Threats

Huge Competitors Product substitution (Bikes,Trucks,Buses) Increasing fuel costs Government policies in entering foreign markets Economic Slowdown

c) Issues :

Now a days market Audi shares falls in the Japan market because when compare to competitors in the Japan are increased and they offer more innovative cars with lower cost, but Audi cars comes with higher cost. Moreover Japan manufactures produce cars with more innovative design and also using of various technologies. But the Audi cars are already break the high selling of cars in worldwide. Audi cars are coming with new technology called E-tron. And also industry try to improve the technology and designing side and also try to sell it with lower cost in upcoming year.

Automobile industry faces various problem to compete in the market.

All the automobile industry facing problems of increase of fuels rate so that selling of luxury cars are decreased because of low mileage.

Because the giant competitors increased so that difficult retain the market

If the products need to lifelong period there is requirement of some key factors like product quality , design , lower cost. If it not , the automobile industry will suffer a lot in the today’s market.

In my point of view audi is expected to beat Mercedes and become no.1 for that Audi is looking forward to launch more models than Benz.Audi has biggest weapon of having Volkswagen .It has only 99% shares of audi

REFERENCES : Strategy Management (5th edition 2010) Pearson(publisher) Author Mary coulter Strategic Planning (John M. Bryson) Corporate Strategy (www.inkling.com/read/strategic-marketing-cravens-piercy-10th/chapter-1/corporate-

business) Marketing Models