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IB BUSINESS MANAGEMENT:
UNIT 4 – MARKETING Marketing in IB Business Management is one of the five core topics and is assessed in both Paper 1 and Paper 2 SL and HL examinations. Marketing is the management task that links the business to the customer by identifying and meeting the needs of customers profitably. It does this by getting the marketing mix right. The success of any business is dependent on its reputation. In order to have good reputation marketing plays an important role by building a brand's name in the market. Marketing educates people on the latest market trends, helps boost sales and profit, and develops company reputation.
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The IB Business and Management Marketing unit covers the following topics:
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The marketing mix |
Marketing is changing fast |
A marketing genius |
Marketing is a fascinating topic to study
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An introduction to marketingMarketing exists to address people's needs and wants. It is all about making customers want to buy the products of a business rather than those of rival businesses. It therefore looks at the reasons behind people's decisions, because ultimately marketing must serve to meet the needs and wants of a customer – essential if a business is aiming at making a profit.
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The different marketing orientations organisations can adopt
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Orientation
Relationship marketing/Relationship management Business marketing/Industrial marketing Social marketing Branding |
Profit driver
Building and keeping good customer relations Building and keeping relationships between organisations Benefit to society Brand value |
Time-frame
1960s to present day 1980s to present day 1990s to present day 1980s to present day |
Description
Emphasis is placed on the whole relationship between suppliers and customers. The aim is to provide the best possible customer service and build customer loyalty. In this context, marketing takes place between businesses or organisations. The product focus lies on industrial goods or capital goods rather than consumer products or end products. Different forms of marketing activities, such as promotion, advertising and communication to the customer are used. Similar characteristics as marketing orientation but with the added proviso that there will be a curtailment of any harmful activities to society, in either product, production, or selling methods. In this context, "branding" is the main company philosophy and marketing is considered an instrument of branding philosophy. |
Why do competitive businesses cluster together? |
Ethics in marketing? |
Contemporary marketing
Recent approaches in marketing include relationship marketing with focus on the customer, business marketing or industrial marketing with focus on an organisation or institution and social marketing with focus on benefits to society. New forms of marketing also use the internet and are therefore called internet marketing or more generally e-marketing, online marketing, search engine marketing, desktop advertising or affiliate marketing. It attempts to perfect the segmentation strategy used in traditional marketing. It targets its audience more precisely, and is sometimes called personalized marketing or one-to-one marketing. Internet marketing is sometimes considered to be broad in scope, because it not only refers to marketing on the Internet, but also includes marketing done via e-mail and wireless media.
Customer orientation: A firm in the market economy survives by producing goods that persons are willing and able to buy. Consequently, ascertaining consumer demand is vital for a firm's future viability and even existence as a going concern. Many companies today have a customer focus (or market orientation). This implies that the company focuses its activities and products on consumer demands. Generally, there are three ways of doing this: the customer-driven approach, the market change identification approach and the product innovation approach.
In the consumer-driven approach, consumer wants are the drivers of all strategic marketing decisions. No strategy is pursued until it passes the test of consumer research. Every aspect of a market offering, including the nature of the product itself, is driven by the needs of potential consumers. The starting point is always the consumer. The rationale for this approach is that there is no reason to spend R&D funds developing products that people will not buy. History attests to many products that were commercial failures in spite of being technological breakthroughs.
A formal approach to this customer-focused marketing is known as SIVA (Solution, Information, Value and Access). This system is basically the four Ps renamed and reworded to provide a customer focus. The SIVA Model provides a demand/customer-centric alternative to the well-known 4Ps supply side model (product, price, placement, promotion) of marketing management.
Product → Solution
Promotion → Information
Price → Value
Place → Access
If any of the 4Ps are a problem or are not incorporated into the marketing plan of a firm, the business could find itself in serious difficulty and other firms may appear and compete in the market for the particular good or service being produced. It is then likely that consumer demand for the firm's products will decrease, sales will fall and profits will decline.
In recent years, as the demand for services has grown with a growth in world incomes, service marketing has widened the domains to be considered, contributing to the 7P's of marketing in total. The other 3P's of service marketing are: process, physical environment and people.
Customer orientation: A firm in the market economy survives by producing goods that persons are willing and able to buy. Consequently, ascertaining consumer demand is vital for a firm's future viability and even existence as a going concern. Many companies today have a customer focus (or market orientation). This implies that the company focuses its activities and products on consumer demands. Generally, there are three ways of doing this: the customer-driven approach, the market change identification approach and the product innovation approach.
In the consumer-driven approach, consumer wants are the drivers of all strategic marketing decisions. No strategy is pursued until it passes the test of consumer research. Every aspect of a market offering, including the nature of the product itself, is driven by the needs of potential consumers. The starting point is always the consumer. The rationale for this approach is that there is no reason to spend R&D funds developing products that people will not buy. History attests to many products that were commercial failures in spite of being technological breakthroughs.
A formal approach to this customer-focused marketing is known as SIVA (Solution, Information, Value and Access). This system is basically the four Ps renamed and reworded to provide a customer focus. The SIVA Model provides a demand/customer-centric alternative to the well-known 4Ps supply side model (product, price, placement, promotion) of marketing management.
Product → Solution
Promotion → Information
Price → Value
Place → Access
If any of the 4Ps are a problem or are not incorporated into the marketing plan of a firm, the business could find itself in serious difficulty and other firms may appear and compete in the market for the particular good or service being produced. It is then likely that consumer demand for the firm's products will decrease, sales will fall and profits will decline.
In recent years, as the demand for services has grown with a growth in world incomes, service marketing has widened the domains to be considered, contributing to the 7P's of marketing in total. The other 3P's of service marketing are: process, physical environment and people.