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O LevelBusinessCambridge (CIE)Business StudiesRevision Notes3. Marketing3.4 Marketing StrategyDeveloping Appropriate Marketing Strategies

Developing Appropriate Marketing Strategies (Cambridge (CIE) O Level Business Studies)

Revision Note

Danielle Maguire

Written by: Danielle Maguire

Reviewed by: Steve Vorster

Marketing Strategy

  • A marketing strategy is a plan that combines the four elements of the marketing mix to achieve specific marketing objectives

Diagram: how the type of market influences the choice of marketing strategy

Marketing strategies will be very different when selling in a B2B market as compared with a niche market
Marketing strategies will be very different when selling in a B2B market as compared with a niche market

  • Marketing strategies vary depending on the type of market being targeted

    • Mass markets, niche markets, business-to-business (B2B) and business-to-consumer (B2C) markets are likely to require different approaches

 A Comparison of Marketing Strategies in Different Markets

Mass Markets

Niche Markets

  • Mass markets are markets in which large numbers of customers have similar needs and wants, e.g. retail clothing

  • Strategies focus on building brand awareness and appealing to a broad audience

    • Advertising campaigns are usually designed to reach as many people as possible and use mass media such as TV, radio, and print ads

    • The messages are often simple and the goal is to create a strong brand identity that resonates with a large segment of the population

  • Niche markets are a sub-section of a larger market with unique preferences or needs e.g organic food stores, luxury car dealerships

  • Strategies focus on targeting a specific segment of the population and building relationships with them

    • Advertising campaigns are usually very targeted and may use social media to reach potential customers

    • The messages are often more detailed and often include technical information that is relevant to the specific needs of the target market

B2B Markets

B2C Markets

  • Selling products to other businesses, e.g. manufacturers selling parts to other manufacturers

  • The emphasis is on building relationships with other businesses and demonstrating how your product can help them be more successful

    • Advertising campaigns may include case studies that demonstrate the value of your product or service

    • The messages are often more technical and may focus on features and benefits that are relevant to other businesses

  • Selling products directly to consumers or via wholesalers or retailers

  • The emphasis is on building brand loyalty and creating a positive customer experience

    • Advertising campaigns may include social media ads or influencer marketing campaigns that appeal to the emotions of consumers

    • The messages are often more emotional and may focus on the lifestyle benefits of using the product or service

Importance of the Marketing Mix in Influencing Consumer Decisions

  • The marketing mix has a significant impact on consumer decisions

    • Businesses need to thoroughly consider each element when developing a suitable marketing strategy so that it is attractive to the intended target market

    • A change in one element can have a significant impact on the others

      • E.g. An increase in price may require a redesign of packaging to encourage customers to consider a product to be of higher quality

    • The marketing mix should change as a product moves through different stages of its product life cycle

      • E.g. Newly-launched products may be sold at a low price initially until sales start to grow; at this point, the price may be increased to improve profit margins 

  • If the marketing strategy fails to combine the elements of the marketing mix appropriately, the marketing objectives are unlikely to be achieved

The Marketing Mix and Consumer Decisions

Product

Price

  • The product/service is the heart of the marketing mix and determines all other elements

    • Price, the target audience, distribution methods and promotional activity stem from the product

  • If the product changes, then all other elements of the mix will likely need to change

    • E.g. the launch a premium version of a product may require an increase the price and redesigned promotional activity to reflect the new product's value

  • Questions to consider

    • Is the product brand new, or is it an existing product?

    • What type of product is desired by the target market?

    • What changes need to be made to the product to make it more desirable?

  • The price of a product is closely linked to its perceived brand value

    • If a product is priced too high, it may be perceived as too expensive by the target audience, leading to lower sales

    • If a product is priced too low, it may be perceived as low quality, leading to lower sales

  • Increasing the price may require changes to the promotion strategy, which are aimed at convincing consumers of the products value

  • Questions to consider

    • What price do key rivals charge?

    • What price is the target market willing and able
      willing to pay?

    • What impact might promotional pricing have on demand?

Promotion

Place

  • The promotion strategy can affect the price and distribution channels

    • E.g. If a business decides upon promotional activity that emphasises luxury, it may need to increase the price to reflect the product's value

  • Questions to consider

    • What is the promotional budget?

    • How does the target market respond to different methods of promotion?

    • What methods do rivals use to promote their products?

  • Distribution and sales channels affect the price and promotion strategy

    • E.g. if a business decides to use exclusive distribution channels, it may need to increase the price to reflect the exclusivity of the product

  • Questions to consider

    • What channels of distribution are most appropriate for the product?

    • Where does the target market expect to be able to buy products?

    • What channels of distribution do rivals use?

Recommending an Appropriate Marketing Strategy

  • Each business combines the different elements of the marketing mix in unique ways for each product or range they sell

  • Elements to consider when formulating an appropriate marketing strategy include

    • Marketing budget for the project

      • E.g. Which advertising media or promotional tactics are affordable?

        • Large budgets will allow a business to use mass media such as TV advertising, whilst smaller budgets may afford only minimal promotional activity using social media

    • Marketing objective to be achieved

      • E.g. Is the plan to increase market share or launch a new product range?

        • Increasing market share may require an emphasis on low prices, whilst price skimming may be important when launching a new product range

    • The intended target market for the product

      • E.g. Is the product to be aimed at families or single-person households?

        • Products aimed at families may be sold in large multipacks, whilst single-person households may be targeted with smaller quantities of standard products

    • Is it a balanced marketing mix?

      • Do the elements of the mix effectively complement each other?

        • Luxury products are likely to require a premium price, whilst products sold in supermarkets may be sold in bright packaging to stand out from other brands 

  • Each product is unique and a different marketing mix will be needed

    • For a music streaming service such as Spotify, the place element is not as important as the other elements, as consumers can access the service from anywhere 

    • For the increasing number of vinyl stores, location in popular high-street locations is vital to success and location is a key element of their marketing mix

  • Many service-based businesses, such as Save My Exams or recruitment companies like The International Educator, have set up as remote companies with employees working from home and services delivered exclusively online

    • This reduces business costs and gives a competitive advantage over competitors who continue to incur office expenses

    • Facilities can be hired for company get togethers or essential business meetings

Examiner Tips and Tricks

The context of the business provides information on the best way forward for each element of the marketing mix. Your case study data will usually set the context and have an appropriate response in mind. When reading case study data, think about the 4Ps and identify what seems to be

  • Any issues with the current marketing strategy

  • Changes the firm could make to improve its sales revenue and profits

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    Author
    Reviewer
    Danielle Maguire

    Author: Danielle Maguire

    Expertise: Business Content Creator

    Danielle is an experienced Business and Economics teacher who has taught GCSE, A-Level, BTEC and IB for 15 years. Danielle's career has taken her from across various parts of the UK including Liverpool and Yorkshire, along with teaching at a renowned international school in Dubai for 3 years. Danielle loves to engage students with real life examples and creative resources which allow students to put topics in a context they understand.

    Steve Vorster

    Author: Steve Vorster

    Expertise: Economics & Business Subject Lead

    Steve has taught A Level, GCSE, IGCSE Business and Economics - as well as IBDP Economics and Business Management. He is an IBDP Examiner and IGCSE textbook author. His students regularly achieve 90-100% in their final exams. Steve has been the Assistant Head of Sixth Form for a school in Devon, and Head of Economics at the world's largest International school in Singapore. He loves to create resources which speed up student learning and are easily accessible by all.