Aims of the Assignment

The most important factor that helps to an organization to grow in the market is depends on how the organization is marketing their products into the market. Earlier most of the organizations are focus on profit they achieved by selling their products into the market but now many organisation follows the  concept of marketing of the product that satisfy the need of the customers. The objective of this Unit 4 Marketing Principles Assignment Shenzen Telecom is to look into a number of different and significant factors related to the marketing strategy for the business origination. The whole concept of marketing is depends on how the organization finds the exact need of the customer and make the product or service accordingly. By taking Shenzen telecom as an example for better understand the concept of the marketing principles. Shenzhen Telecom imports / assembles and markets the branded fixed line phones (CDMA, Codeless Phones, CLI Land Lines etc) ‘S-Tel’. The company which was incorporated in 1992 and it is equipped with the state of the art factory. Shenzhen had partnered with a telecom company in Hong-Kong. The company has wide dealer network which has resulted into distribute products island wide (available island wide). Due to rapid growth of sales, it has received a substantial quantum of cash to be invested, and the Board of Directors has decided to grow the organisation further by diversifying into mobile phones. The marketing team has come up with a brand name “Tecno”,

 

Task 1: Understand the concepts and process of Marketing

Explain the various elements in the marketing process that the management should take into consideration when moving into marketing mobile phones. Your answer should be illustrated with relevant marketing concepts. (P1.1)

Marketing is depends on identifying the exact need of the customer  that is not fulfilled by the competitors at present into the market or predict the future need of the customers and manufacture or provide product or service to satisfy the need accordingly. There are the concepts of marketing with the example of “Shenzen Telecom”

  • Product concept- “Shenzen Telecom” has to focus on the diversify their product of Mobile phone, Brand name as “Tecno” Technological innovation is the main tool of this concept that attracts the customer most. For example- User friendly, ECO friendly, long life time of the battery ect.
  • Sales concept- “Shenzen Telecom” has to focus on selling of what it make
  • Production concept- Shenzen Telecom has to increase the production of the mobile phones without worrying about selling of the product.
  • Market concept- This is a concept which focuses on the research about the product (Mobile phone) that could satisfy the need of the customers and produce them. In this the regard customer satisfaction is the most important factor.
  • Societal concept- According to this concept, Shenzen Telecom has to focus not only on the needs and want of the customer’s, but also to surrounding nature and environments.
  • Selection of the goal: in 1992 start the Shenzen Telecom to imports, assemble and marketing of branded fixed line phones (CDMA, Codeless Phones, CLI Land Lines etc) ‘S-Tel’. Shenzhen had partnered with a telecom company in Hong-Kong.
  • Analysis: Research has to conduct before establish “Tecno” brand mobile phone by Shenzen Telecom. It includes: Market research (to predict the market compatibility), customer analysis (to get the exact need of the customer), product analysis (to produce the product to the need for ex- design and shape). Generally the SWOT analysis is conducted by the organization to examine the market factor. The SWOT analysis of Shenzen telecom is given bel
StrengthsWeaknesses
  • Brand in Telecommunication sector.
  • Partnership with Hong-Kong Telecom Company.
  • Customer loyalty.
  • High turnover
  • Skilled staff and employee
  • Poor online presence
  • Lack of patent
OpportunitiesThreats
  • Expansion in new market
  • Expansion in the range of the Mobile phones
  • Economy inflation
  • Increment in the cost for raw materials.
  • Government taxes/duty for imports
  • Competitors such as Adidas etc.

1.2. In modern volatile business environment to stay ahead of competition, it is important that companies should be marketing oriented. Evaluate the benefits and the costs of being marketing oriented for Shenzhen Telecom? (P12)

Current market orientation which Shenzhen Telecom has is a mass marketing strategy. The various other promotional activities are introduced by the company. This is important for the company to tell customers that there will be other brands which will be quickly following the footsteps of the company and hence the marketing orientation of company is aimed at generate a lot of interest around the product offering of the company. The benefits which this marketing approach and orientation of Shenzhen Telecom are as bellow,

  1. Reach of the marketing elements: This including the advertising it is possible for the company to ensure that it can reach as much as possible customers for creating a mind share in them which leads to future sales and new products for the company.
  • The increased brands recall and brand value: Activities include the advertising and it is possible for the company to drive a very effective brand recall and brand value in the mind of customers. Shenzen Telecom marketing research has identifies the gaps in the needs and wants of the target consumer base and the entire marketing strategy is created to let the customers know that the brand will able to meet the needs in a better way than the competitor entities. At the time of the diversifying the business into mobile phone the customers tend to choose for brand “Tecno” as different to the other companies in the same segment.

However apart from above mentioned advantages some of the disadvantages also encountered as bellow.

  • High cost of marketing: Above line activities in which advertisement need to be in different modes like by posting on online sites, newspaper, by publishing in any local newspaper in different languages which use in the country. This is a very costly way of marketing of the brand.
  • Changes in the Market Environment are Not Factored in: Mass marketing strategies fails to identify the changes which can take place in business environments. There are various characters leading to market changes in terms of the marketing environment. i.e. change in consumer preference, changes in price, inflation etc. If price of a particular product changes, consumers will start looking for another substitute that gives them the same satisfaction but at an affordable price. Changes in consumer preference can result in changes in marketing environment. As a fact that mass marketing has no specific targeting strategy, a change in a specific set of consumer behavior cannot be tackled by this method.

Task 2: Segmenting, Targeting and Positioning

2.1 Explain how both macro and micro environment factors would affect the marketing decisions of the new division Shenzhen Telecom. (P2.1)

Marketing environment refers to the external forces and factors which affect to the company’s ability to develop and maintain successful transactions and relationships with target customers. Marketing environment has two categories

  • MICRO ENVIRONMENT
  • MACRO ENVIRONMENT

MICRO ENVIRONMENT

The environment which can closely affect positively or negatively to the company. It creates value and relationship with its customers. Success of the market need building relationships with other companies, departments, suppliers, marketing intermediaries, customers, competitors, and various publics, which combine to make up the company’s value delivery network. Micro environment that surrounds organization can be complex by nature; but company has a part of control over it.

Some of the factors which affect the micro environment are:

SUPPLIERS

Suppliers of the mobile phone parts are very important link in delivering the value to the customers. Problem of the suppliers can be seriously affected to the market. Therefore marketing management always observes carefully on the supply availability and costs. Supply shortage or delays, labor stricken and other events can damage customer satisfaction in the long run and rising supply costs can harm the company sales volume and the profit margin.

INTERMEDIARIES

Market intermediaries/Distributors or the agents help the company to promote, sell, and distribute its product to the final buyers. It includes retailers, wholesalers, physical distribution firms, financial intermediaries. Physical distribution firms help the company to stock and move goods from their point of origin to their destination. Today’s marketers recognize the importance of working with the intermediaries as partners rather than simply channels through which they can sell their product.

COMPETITORS

The marketing states that the company must provide greater customer value and satisfaction than the competitors do. They can gain strategic advantage by strongly offering against competitors offerings in the minds of consumers. As, large firms dominant positions in an industry can use certain strategies which the smaller firm cannot afford. Being larger is not enough. There are both winning strategies and losing one’s too.

CUSTOMERS

Customers are the most important factor in the microenvironment. The aim of the entire delivering system is to serve the target customers and create the strong relationship with them by satisfying them as much as possible.

MACRO ENVIRONMENT

Macro environment consists of broader forces that shape opportunities and pose threats to company.

DEMOGRAPHIC ENVIRONMENT

The study of statistics of births, deaths, disease etc in order to show the state of population is known as demography. The demographic environment refers to the level of population growth, age, sex, education patterns, family influences etc.

ECONOMIC ENVIRONMENT

Economic environment comprises the nature of economic system of the country, the structural anatomy of the economy, the economic policies of the government, the nature of factor endowment and markets.

NATURAL ENVIRONMENT

The physical and geographical factors can play a predominant role in constituting the non-economic environment and thereby affecting the business. The application of modern technology leads to rapid economic growth at a huge social-cost deterioration of the physical environment i.e. air pollution, noise pollution, and water pollution. The nature of such costs is being assessed by biologists, ecologists, and sociologist.

TECHONOLOGICAL ENVIRONMENT

Technology shapes the future of any society. Marketers must always watch the fluctuations in the technology for keeping track of competition and customer wants. In the modern world, the level of technological changes is very fast. Technological environment influence work at the organization in terms of investment in technology, consistent application of technology and the affects of technology on markets. Mobile phones are a technological oriented product so the shenzen telecom needs to focus this more.

POLITICAL ENVIRONMENT

This provides the legal framework / imposes taxes & duties within the marketer are to function. The viability of business depends upon the ability with which it can meet the challenges arising out of the political environment. The political environment of a country is influenced by political organizations, political stability and foreign policy etc. all these factors have a bearing on business.

CULTURAL ENVIRONMENT

The culture environment of a nation determines the value system of the society which in turn affects the marketing of products. Sociological factors such as caste structure, mobility of labor, customs, cultural heritage, etc. might have far reaching impact on business. Cultural environment also determines the code of conduct the business should follow.

2.2 Propose segmentation criteria that Shenzhen Telecom could adapt to market mobile phones (P 2.2)

Market segmentation must be focus on the marketing mix (4P’s), Shenzen Telecom company may divide its market based on three types i.e. customer groups, customer groups based on needs, target customer. Criteria of marketing segmentation for Shenzen Telecom company are geographical, demography, psychographic, behaviorism. Firstly, geographical, Shenzen Telecom company will take the store in big cities in the country. This is good for company to distributing products easily.

Secondly, demography, Shenzen Telecom should focus on younger customers. Because they are like to pay money to get mobile phones, because they are interested in the technology, design and quality it and the brand name.

Thirdly, psychological, if company wants to sell more and more and Mobile phones in the country, they need to create mass effect. Because every people in the country Hong-Kong have psychological interest when they see a crow. Lastly, Behaviorism is the same life style; trends of customers who are followed by tecno brand. Based on the actual situation, with a potential market like Hong-kong, shenzen telecom should combine geographical and demographical so there may be a market segmentation strategy in the country. This combination for the Shenzen telecom will make a new vision, a customer orientation and age appropriate for the company new products.

 

2.3 What could be the ideal target market for Shenzhen’s mobile phones? Justify why you have selected that the particular segment to be targeted. (P 2.3)

From the view of marketing team of shenzen telecom a suitable targeting strategy must be accessed by the point of marketing mix coordinate with differentiated. And the most important thing is creating more loyal customers to the company.

Place: the manager should retail shop in each city of the country.

Price + Product: From general and best view of Shenzen telecom should choose the differentiated strategy. Recently, in the world, Apple is a large, well reputed computer and mobile phone Company, their strategy is differentiated. They just focus on the quality of their product and the service. They want their product to become the best in the world, they add more value into their product, and if the customer loves that, price of product never be an issue

Apple will be price maker. Apply for shenzen telecom; they should take care more and more about their product, if the customer in love with Tecno mobile phone, they will pay any money to buy that. Their strategy is differentiated they should focus on value added features for the phone to make attract by young customer, they will buy it even products are too expensive.

Promotion: Advertising is the best way to introduce product to customer.

People: Shenzen Telecom should use entrepreneurial structures, all power around the owner manager for easy to control employees.

Process: In the first time, company uses the products that were importing. After getting achievement in Hong-Kong, they should take a factory in here; company will discount the price Physical Environment: Facilities of store, company that manager should take care. From designing view of store with air conditional, etc. Shenzen Telecom target is equipping facilities for customer to be satisfaction.

2.4 Demonstrate the buyer behavior for mobile phones and explain how buyer behavior could affect the marketing activities when marketing to end users and resellers. (P 2.4)

Branded fixed line phones (CDMA, Codeless Phones, CLI Land Lines etc) ‘S-Tel’ are the main products to develop the Shenzen Telecom in Hong-Kong. Above models are to show how buyer behavior affects marketing activities of the company. Stimulus Process Response Culture Social influence Reference group Marketing mix Psychological factors Physiological factors Perceptions and feelings Attitudes and beliefs Buying behaviors Buying practices

Stimulus: Factors affecting Motivation of consumers to buy such product are culture, social influence, reference group and marketing mix. Process: Regarding Maslow’s Hierarchy of Needs influence by Psychological factors, physiological factors and Perception and feelings.

Response: After having particular analysis about the marketing, customer will having response with market. This is called is Business to customer of marketing. This is time that customers choose the product or company is at the company’s marketing process give the results. Based on all these factors, firm-level information about the product, it is time the customer has decided to spend the money to buy the products of company or not.

When marketing to business, the logic of the product by focusing more on functional characteristics. Emotional factors in the decision usually not play an important role. Therefore, with business to business, there are factors influence organizational buying behaviors with shenzen telecom product – Environment forces: Economic outlook: domestic and global reputation of shenzen telecom.

Organization Forces: Goal, objectives and strategies of Shenzen telecom. It is from the above factors, a business customer can evaluate and purchase decisions from the company.

2.5 Propose a positioning strategy that Shenzhen Telecom could adopt for mobile phones “Tecno”, (P 2.5)

Current position strategy of the shenzen telecom only limited to imports / assembles and markets the branded fixed line phones (CDMA, Codeless Phones, CLI Land Lines etc) ‘S-Tel’.is so simple, so look on the aspect as a marketing people, company need to change their strategy and diversify the business into mobile phones confirm position in the market in Hong-Kong Product and Price Positioning Strategy: “High Price” “Low Price” With two major product lines, Shenzen telecom can assert its position in the market through product, price and quality of the product. Products of shenzen telecom are in both the mid-range segment and luxury segment. Luxury goods, the quality and the price are also high. With mid-range segment, the product will have cost less than luxury but the quality will not high. However the provision of sufficient information and the quality of the product, combined with the suitable marketing strategy, Shenzen telecom can fully assert its position on the Hong-Kong market. This approach can make a difference in the brand for the company’s products, the advantages of this approach in the long term and short term will help the company gain trust from customers. That is the best positioning strategy for the company. “Low Quality” CDMA “High quality” Tecno

Task 3: Marketing Mix

3.1 Explain how new developed product (mobile phones) would help to sustain the competitive advantage of Shenzhen Telecom. (P 3.1)

Tecno add

As Shenzen telecom well aware any organization can get competitive advantage only by producing the great quality of the product. They provide branded product to their customers. It needs to be done very well in the demographic segment within the country. As discussed shenzen telecom need to focus on the behavioral segment and should focus on the customer that need the great quality and comfortable product in return of their money especially for the young people who want ECO friendly with more features in the mobile phone. Shenzen telecom can introduce a new section for the people who want ECO friendly phone rather than typical mobile phone which we using now. Only the satisfaction of the customer through the development or introduction of the new product is not enough, the customer is more demanding and is fully aware of the company that works on the welfare of the society. Hence, now days, the customer is attracted by the company that is being involved in the environment and societal factor. So, to gain the competitive advantage, only the production of verities of phones is not enough. Shenzen Telecom needs to involve in the affair that is only for the welfare of the society and environment.

3.2 Explain how the distribution should be arranged to make the mobile phones available island wide. (P 3.2)

The main aspire of the distribution is to make the product available island wide to the customer so that customer can purchase for use the product. Shenzen telecom is the organization that is done very well business in Hong-Kong so far due to the best distribution policy they have established. Generally, Shenzen telecom uses the selective distribution strategies in which company choose the best location from where the customer can get the phones. The number of the outlet or stores in a particular area is limited so that it covers the equal areas of the customers where they live, so Shenzen Telecom can use the same criteria for the new segment. Selective distribution also helps in maintaining the good relationship with the customer and its channel members and gives maximum market coverage and more control over the factors such as transportation, production, after sales services, etc. Besides this, Shenzen telecom is very well aware of the technology that is being used. So it can be made an online presence over the internet. The customer can purchase the phones by clicking over them on its website.

3.3 Explain how prices should be set to achieve the organisation’s objectives and market conditions. (P 3.3)

For introducing new product or segments by keeping mind that the old aged people are very price sensitive. So the best strategy for the newly introduced product should economy pricing and psychological pricing. Earlier Shenzen Telecom may use the economy pricing in which the price is set as low as the company could have due to marketing of CDMA. The price of the product could be calculated by the calculating the cost of raw material and the cost of production function plus calculated profit.

3.4 Propose effective ways to implement promotional activities be used to achieve marketing objectives with suitable illustrations. (P 3.4)

Promotion is the activity that is widely used by organizations to make the aware of the customers about the products of the company. There are many technologies that help the organization to promote the product such as promotions, advertisements, public relation, publicity etc. As Shenzen Telecom belongs to the Tele communication industry it needs to use the integrated promotional activities to promote the product because the technology keeps change in a short interval time and shenzen telecom has to gain the profit to meet the marketing objective in this period only to get success. The integrated promotional activities as follows:

  • Advertisement and PR: advertisement and PR is the good mixture of the promotional activities as advertisement would help in drawing a picture of the product in the mind of the customer and public relation will help in maintaining the good relationship with the customers.
  • Social media: social media is a podium where most of the customer of electronic items comes together and share their views on the different topics. Shenzen Telecom also can use the social media such as face book, twitter ect to promote their product.
  • Thinking out of box and sales promotion: As known shenzen telecom belongs to the one of the lifestyle category. In this, most of the customers get attracted by the ideas that are different from others. In this way, shenzen telecom can use the different type of coupon and gifts for the customer who regularly visits the place etc.

Task 4: Use Marketing Mix in Different Context

4.1 Illustrate how you would develop marketing mixes for fixed lines and mobile phones in the consumer market. (P 4.1)

The marketing mix for two segments (Fixed line & mobile) is as follows:

Fixed segment: marketing mix for this segment is as bellow:

  • Product: Shenzen Telecom is long term offering or focusing on fixed line telephones and every customer whether it is related to the young age to old age, professional to home maker, ladies to gents etc.
  • Place: the best places for the stores of shenzen telecom are the main cities where the people are gathered.
  • Pricing: the price of the product should be low as shenzen telecom aim is to provide the service at low price but for accessories the price could be set a little bit high. The main customer of the shenzen telecom is professional so that price could be in high in range.
  • Promotions: sales promotions, advertising and public relation are the tools that could be use in the promotion of the product offered by Shenzen Telecom.

Mobile phone segment: The marketing mix for this segment is as follows:

  • Product: Shenzen telecom has to focus on the culture of the customer in which it is going to open the stores and also has to follow rules and services.
  • Place: To enter into new market, Shenzen telecom need to focus on the stylish areas of the city or state where it can set a good image of the brand in the mind of customers.
  • Pricing: Initially the pricing for this segment could be low as it needs to penetrate into the new market.
  • Promotions: the promotion strategy for the Shenzen Telecom could be advertisement, public relation, positioning etc.

4.2 Illustrate differences in marketing activities carried out when Shenzhen Telecom is catering directly to consumers and marketing to retailers. (P 4.2)

The difference between the marketing the products and services of Shenzen telecom in Business to customer and Business to business are as bellow:

  • Identification of need: in Business to customer, the customer is in the direct contact of Shenzen telecom. So it is very easy for the organization to predict the need of the customer while in Business to Business, there are various customers but Shenzen Telecom does not have direct contact to them. So it is very difficult to forecast the need of the customers.
  • Promotions: Shenzen telecom can easily attract the customer by their reputation over the years as branded tele communication provider in the country. Also doing efforts in the advertisement and public relation but in the Business to Business, the promotion of the product depends on the relationship with the business coordinate etc.
  • Bulk buying: Business to Customer does not believe in bulk buying. There are many customers of shenzen telecom that buy product such as phones but in less quantity while in Business to Business, there are few customers but buys the huge quantity of same product.

4.3 Suppose the management of Shenzhen decided to export their products to Africa. How marketing Shenzhen products in Sri Lanka would be different compared to marketing in Africa and explain as to why these differences would arise. (P 4.3)

There is an enormous difference between the domestic and international marketing for shenzen telecom as identified bellow:

  • In domestic marketing, there is no need of forecast the needs, taste and preference and culture of the society or country even the currency is same. But in international marketing, it would be very difficult for predict the taste and preference of the population and especially the culture of the country. Currency exchange, political barrier, economical barriers, culture difference etc are the obstacle that shenzen Telecom has to face on entering into market of new country like Africa and Sri Lanka (Asian)
  • In domestic marketing, the competition is very less in comparison to the international marketing as Shenzen Telecom has to face the challenges of the giant organization of the other countries.
  • To enter into market of new country, Shenzen telecom has to conduct the different research in results a spending loss of money while in domestic market there is no need of such high level research as the company is already aware of lots of things.
  • Shenzen Telecom has to recruit new employees for the new store in new country who are very well aware of the business environment of the country so that Shenzen Telecom can attract the customer to ward them while in domestic marketing it is not so important.

Conclusion

Shenzen Telecom is a much known brand into the Tele communication industry in Hong-Kong which basically works on the market orientation concept of the marketing. Shenzen telecom only focuses on the exact need and wants of customers. In this paper, the concept of marketing, marketing process and the benefits and cost associated with the marketing orientation has described. The segmentation, targeting and positioning strategy are described along with the difference in domestic and international marketing.

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