Introduction to Marketing Concepts
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Questions and Answers

Which element is NOT part of the marketing function?

  • Conducting financial audits (correct)
  • Implementing pricing strategies
  • Planning the conception of products
  • Distributing products or services

    • Which is a key question that should be answered to align a firm’s offerings with its customers?

  • How much are my customers willing to pay? (correct)
  • What is my firm's historical sales data?
  • What are my competitors offering?
  • What are the latest market trends?

    • What is the main purpose of market strategy planning?

  • To evaluate employee performances
  • To identify attractive market opportunities (correct)
  • To set product manufacturing standards
  • To determine the company’s financial stability

    • What output is a result of market strategy planning?

    <p>The target market</p> Signup and view all the answers

    Which of the following components is not included in the marketing mix?

    <p>Positioning</p> Signup and view all the answers

    What does the marketing concept primarily emphasize for small businesses?

    <p>Aligning products with customer needs</p> Signup and view all the answers

    Which of these is a method to gather insights on market needs?

    <p>Marketing research</p> Signup and view all the answers

    What aspect is NOT critical in devising a marketing strategy?

    <p>Analyzing employee satisfaction</p> Signup and view all the answers

    What components are included in the product offering?

    <p>Packaging, warranties, and maintenance</p> Signup and view all the answers

    Which factor is primarily considered when setting the price of a product?

    <p>Profits</p> Signup and view all the answers

    What is the main purpose of promotion in marketing?

    <p>To communicate and influence buying behavior</p> Signup and view all the answers

    Which of the following best describes personal selling?

    <p>Direct communication between sellers and potential customers</p> Signup and view all the answers

    What does market research primarily help businesses identify?

    <p>Market needs and competition</p> Signup and view all the answers

    What is primary research in market research?

    <p>The collection of original primary data</p> Signup and view all the answers

    Why is it important to consider competitor pricing?

    <p>To ensure profits are maximized</p> Signup and view all the answers

    How does promotion contribute to sales?

    <p>By creating interest and stimulating purchases</p> Signup and view all the answers

    What is a notable disadvantage of primary research?

    <p>It may yield a low response rate.</p> Signup and view all the answers

    Which of the following is considered a primary source of secondary research?

    <p>Sales reports from a company's records.</p> Signup and view all the answers

    What is market share essentially calculated as?

    <p>Individual firm's sales as a percentage of total market sales.</p> Signup and view all the answers

    Which source would you consult for determining the number of schools in a specific area?

    <p>The Commission on Higher Education (CHED).</p> Signup and view all the answers

    Which library is known to have a collection of original studies and trade journals?

    <p>National Library.</p> Signup and view all the answers

    What should be determined to effectively forecast market share?

    <p>Total sales revenue of the industry in the target market area.</p> Signup and view all the answers

    What role does the Department of Trade and Industry (DTI) play in research?

    <p>They provide information on existing enterprises in an area.</p> Signup and view all the answers

    Which of the following is NOT a step in determining probable market share?

    <p>Assess the competitor's sales tactics.</p> Signup and view all the answers

    What does CMS represent in the market share calculation?

    <p>Company's market share</p> Signup and view all the answers

    Which method of sales forecasting involves asking customers about their purchasing intentions?

    <p>Survey of buyer intention</p> Signup and view all the answers

    Which of the following methods applies a flat percentage increase to previous sales data?

    <p>Past sales analysis</p> Signup and view all the answers

    What is the purpose of trend analysis in sales forecasting?

    <p>To forecast long-term and short-term sales</p> Signup and view all the answers

    How is company sales defined in relation to market potential?

    <p>Actual sales made by the company</p> Signup and view all the answers

    Which forecasting method involves limited market testing before a product is rolled out widely?

    <p>Test marketing</p> Signup and view all the answers

    Which of the following sales forecasting methods relies on estimates from sales representatives?

    <p>Sales-force composite</p> Signup and view all the answers

    What does potential sales of the target market refer to?

    <p>Total sales volume all competitors could achieve</p> Signup and view all the answers

    What is the primary difference between secondary research and primary research?

    <p>Secondary research synthesizes existing data, while primary research collects new data.</p> Signup and view all the answers

    Which of the following methods is NOT typically used in primary research?

    <p>Literature Review</p> Signup and view all the answers

    Which primary research method involves no direct interaction with the subjects being observed?

    <p>Observation</p> Signup and view all the answers

    What is one major disadvantage of primary research compared to secondary research?

    <p>It can be very expensive and time-consuming.</p> Signup and view all the answers

    Which type of survey method is considered the most expensive and time-consuming?

    <p>Personal Interview</p> Signup and view all the answers

    What is a requirement for conducting a successful telephone survey?

    <p>Cordial interviewers</p> Signup and view all the answers

    In the experimental method of primary research, what is held constant while observing the change in one variable?

    <p>All other conditions</p> Signup and view all the answers

    Which of the following is an advantage of primary research?

    <p>Ability to customize the research design</p> Signup and view all the answers

    Marketing is a function concerned with planning and implementing the conception, pricing, promotion, and distribution of products or services that will satisfy the firm's ______.

    <p>objectives</p> Signup and view all the answers

    A marketing strategy must identify who the ______ are to effectively align products or services with customer needs.

    <p>customers</p> Signup and view all the answers

    The marketing mix refers to the set of marketing tools that the firm uses to pursue its marketing ______ in the target market.

    <p>objectives</p> Signup and view all the answers

    In market strategy planning, one must analyze the external ______ to identify attractive market opportunities.

    <p>environment</p> Signup and view all the answers

    Developing a marketing ______ is essential for small businesses to engage in effective marketing efforts.

    <p>strategy</p> Signup and view all the answers

    To develop a marketing mix, a firm must first identify the size of the ______.

    <p>target market</p> Signup and view all the answers

    An important aspect of the marketing concept is ensuring a match between intended ______ and the firm’s products or service offerings.

    <p>customers</p> Signup and view all the answers

    A good marketing ______ combines various elements to effectively reach and satisfy the needs of a target market.

    <p>mix</p> Signup and view all the answers

    The combination of product line, quality levels, and customer services is known as the product __________.

    <p>offering</p> Signup and view all the answers

    In marketing, the element that refers to the cost charged for products is called __________.

    <p>price</p> Signup and view all the answers

    __________ involves the communication of information to influence buying attitudes and behaviors.

    <p>Promotion</p> Signup and view all the answers

    Market __________ is the organized effort to gather information about markets or customers.

    <p>research</p> Signup and view all the answers

    __________ research consists of collecting original data to gain insights into market issues.

    <p>Primary</p> Signup and view all the answers

    The right __________ ensures that products are available in adequate quantities at suitable locations when customers need them.

    <p>place</p> Signup and view all the answers

    Sales promotion can include tactics such as __________, coupons, and point-of-purchase displays.

    <p>samples</p> Signup and view all the answers

    Understanding market size and competition is a key advantage provided by market __________.

    <p>research</p> Signup and view all the answers

    By the time the research is complete, it may be out of ______.

    <p>date</p> Signup and view all the answers

    Company records include sales reports or clues on customer ______.

    <p>behavior</p> Signup and view all the answers

    Libraries are important for collecting original studies, trade journals, and business ______.

    <p>magazines</p> Signup and view all the answers

    The Commission on Higher Education (CHED) provides basic data on the number of ______ operating in specific areas.

    <p>schools</p> Signup and view all the answers

    Market share refers to the individual firm's sales as a percentage of total sales in a specific ______.

    <p>market</p> Signup and view all the answers

    To determine probable market share, one must ascertain the purchasing ______ of the target market.

    <p>power</p> Signup and view all the answers

    The Department of Trade and Industry (DTI) provides information on the number of ______ existing in an area.

    <p>enterprises</p> Signup and view all the answers

    Reports, newspapers, and journals are considered ______ research sources.

    <p>secondary</p> Signup and view all the answers

    Secondary research involves the summary, collation and/or synthesis of existing ______ rather than primary research.

    <p>research</p> Signup and view all the answers

    In the observational method, data is collected by ______ the actions of a person or a group.

    <p>observing</p> Signup and view all the answers

    A survey can gather data by ______ people through methods like personal interviews and telephone surveys.

    <p>interviewing</p> Signup and view all the answers

    The most expensive and time-consuming method of primary research is the ______ interview.

    <p>personal</p> Signup and view all the answers

    In experimental research, one variable is changed while keeping all other ______ constant.

    <p>conditions</p> Signup and view all the answers

    Primary research can focus on both qualitative and ______ issues.

    <p>quantitative</p> Signup and view all the answers

    Primary research can be very ______ compared to secondary research, as it often incurs higher costs.

    <p>expensive</p> Signup and view all the answers

    Conducting primary research requires the development and execution of a ______ plan.

    <p>research</p> Signup and view all the answers

    The company’s market share can be computed using the formula: CMS = CS/TIS, where CMS stands for the company’s ______.

    <p>market share</p> Signup and view all the answers

    The potential sales of the target market refer to the total sales volume that all ______ could achieve in that particular market segment.

    <p>competitors</p> Signup and view all the answers

    Market-factor analysis assumes that the future demand for a product is related to the behavior of certain ______.

    <p>market factors</p> Signup and view all the answers

    Test marketing is a forecasting method in which a company markets its new product in a limited ______ area.

    <p>geographic</p> Signup and view all the answers

    Past sales analysis applies a flat percentage ______ to the average volume achieved last year.

    <p>increase</p> Signup and view all the answers

    Trend analysis uses statistical methods such as regression analysis for forecasting sales over the ______ term.

    <p>long</p> Signup and view all the answers

    The sales-force composite method involves collecting estimates of sales from all ______ assigned to specific territories.

    <p>salespeople</p> Signup and view all the answers

    The sales potential of the company refers to the portion of the market potential that the company could expect to achieve under ______ conditions.

    <p>ideal</p> Signup and view all the answers

    Study Notes

    What is Marketing?

    • Marketing involves planning and executing the creation, pricing, promotion, and distribution of products or services to achieve business objectives.

    Marketing Concept

    • The marketing concept emphasizes aligning a business’s offerings with the needs and wants of its target customers.

    Marketing Strategy Planning

    • This is a process where businesses identify opportunities, develop profitable marketing strategies, and analyze internal and external environments to identify attractive market opportunities.

    Key Questions in Marketing

    • Who are my customers?
    • What products or services do my customers need?
    • What price are they willing to pay for my products or services?
    • Where do they need my products or services?
    • When do they need my products or services?
    • How do they want to receive my products or services?

    Market Strategy

    • A general guide for achieving a business's marketing goals.
    • It involves getting products and services to customers efficiently, cost-effectively, and appropriately.

    Marketing Mix

    • A combination of controllable variables that companies use to achieve marketing objectives in their target market.

    • The four key elements are:

      • Product Offering: Includes the breadth of the product line, quality levels, and customer services.
      • Price: Determined considering profits, production costs, marketing expenses, and competitors' prices.
      • Promotion: Communicating information between the company and potential buyers to influence buying attitudes and behavior.
        • Examples include personal selling, advertising, and sales promotion.
      • Place (Distribution): Ensuring products are available in the right quantities and locations when customers want them.

    Market Research

    • Any organized effort to gather information about markets or customers.
    • A vital component of business strategy.

    Types of Market Research

    • Primary Research: Collecting original data directly from sources.
    • Secondary Research: Utilizing existing information, such as summaries, collations, and syntheses of previous research.

    Primary Research Methods

    • Observation: Gathering data by observing the actions of individuals or groups without direct interaction.
    • Surveys: Collecting data through interviews.
      • Personal Interviews: The most expensive and time-consuming method.
      • Telephone Surveys: Requires a well-designed questionnaire, a representative sample group, and courteous interviewers.
      • Mail Surveys: Sending questionnaires through postal services.
      • Internet Surveys: Posting questionnaires on a company website or distributing them to target groups.
    • Experimentation: Observing changes in results by altering one variable while keeping other conditions constant.

    Advantages of Primary Research

    • Allows focus on both qualitative and quantitative aspects.
    • Enables researchers to tailor the research design to meet specific needs, providing greater control over the process.

    Disadvantages of Primary Research

    • More expensive and time-consuming than secondary research.
    • Requires a well-developed research plan.
    • Information gathered can become outdated quickly.
    • May encounter low response rates.

    Secondary Research Sources

    • Company Records: Sales reports, customer behavior data.
    • Libraries: Collections of original studies, trade journals, business magazines, and graduate theses.
    • Government Agencies:
      • CHED (Commission on Higher Education): Provides data on the number of schools, courses offered, student enrollment, etc.
      • DTI (Department of Trade and Industry): Information on the number of businesses in a particular area.
      • Local Governments: Listings of businesses and business types.

    Market Share Forecasting

    • Determining the amount of sales a company can achieve by focusing on a specific market segment.
    • Market Share: A company's sales as a percentage of total sales in a specific market.

    Steps in Calculating Market Share

    • Define the physical limits of the target market area.
    • Determine the potential sales of the target market based on demographic characteristics.
    • Determine the target market's purchasing power.
    • Determine the total sales revenue of the industry in the target market area.
    • Determine the percentage of total sales that the company can effectively serve.

    Formula for Calculating Market Share

    • CMS = CS / TIS
    • CMS = Company's Market Share
    • CS = Company's Sales
    • TIS = Total Industry Sales

    Forecasting Company Sales Methods

    • Market-Factor Analysis: Assumes future demand for a product is connected to specific market factors.
    • Survey of Buyer Intention: Asking current or potential customers about their purchasing intentions for a product at a given price.
    • Test Marketing: Testing a new product in a limited geographic area, measuring sales, and projecting results to a larger area.
    • Past Sales Analysis: Applying a flat percentage increase to previous years' sales volume.
    • Trend Analysis: Using statistical methods, like regression analysis, to forecast sales over long or short terms.
    • Sales-Force Composite: Collecting sales estimates from each salesperson for their assigned territories.

    Marketing

    • A business function that focuses on planning and implementing the development, pricing, promotion, and distribution of products or services to achieve organizational objectives.

    Marketing Concept

    • It emphasizes the importance of understanding and meeting customer needs to achieve firm success.

    Devising a Marketing Strategy

    • It involves understanding customer needs and aligning the firm's product or service offerings with those needs.
    • It is an essential step in guiding the firm's marketing efforts to reach customers in a timely, cost-effective, and appropriate manner.

    Market Strategy Planning

    • It's a systematic process that analyzes the market and the firm to identify attractive opportunities and develop profitable strategies.
    • Considers the firm's strengths and weaknesses.
    • Examines the external environment to identify potential opportunities.
    • It helps to define:
      • The target market
      • The marketing mix
      • The size of the market area

    The Marketing Mix

    • It is the set of controllable marketing variables used to achieve marketing objectives in the target market.
    • It consists of:
      • Product offering: Product line, quality levels, and customer services.
      • Price: Determined considering profitability, cost of production, marketing, and competitive pricing.
      • Promotion: Advertising, sales promotion, and personal selling.
      • Place (distribution): Making products available in the right quantities, locations, and when customers need them.

    Marketing Research

    • It is a systematic process of gathering, analyzing, and interpreting information about markets and customers.
    • It is crucial for guiding business strategy and gaining a competitive advantage.

    Types of Market Research

    • Primary Research: Involves collecting original data directly from the source (observations, surveys, or experiments).
    • Secondary Research: Utilizes existing data from sources like company records, libraries, government agencies, reports, newspapers, magazines, and journals.

    Primary Research Methods

    • Observation: Collecting data by observing people or groups in their natural setting without direct interaction.
    • Survey: Gathering data through interviews, telephone calls, mail, or online questionnaires.
      • Personal interviews: Expensive but provide detailed information.
      • Telephone surveys: Require good questionnaires, a representative sample, and courteous interviewers.
      • Mail surveys: Less expensive, but response rates can be low.
      • Internet surveys: Convenient but may have limitations with sample selection.
    • Experimentation: Modifying one aspect of a situation and observing the effects while keeping other conditions constant.

    Advantages of Primary Research

    • Allows the researcher to focus on both qualitative and quantitative research questions.
    • Gives control over the research design to fit specific needs.
    • Offers strong control over the data collection process.

    Disadvantages of Primary Research

    • More expensive than secondary research.
    • Requires time and effort to develop and execute a research plan.
    • May be outside the budget of smaller businesses.
    • Information can be outdated quickly.
    • Can have low response rates.

    Possible Sources for Secondary Research

    • Company records: Sale reports and customer behavior data.
    • Libraries: Original studies, trade journals, business magazines, and graduate theses.
    • Government agencies: Data on demographics, industries, businesses, and economic indicators.

    Other Sources of Secondary Research

    • Reports, newspapers, magazines, journal articles, government and NGO statistics.

    Major Libraries

    • National Library
    • University of the Philippines – Institute of Small Scale Industries Library
    • Development Academy of the Philippines Libraries Pasig City
    • Polytechnic University of the Philippines Library Sta.Mesa

    Using Government Data for Market Research

    • Commission on Higher Education (CHED): Provides information on the number of schools, courses, students, and other education-related data.
    • Department of Trade and Industry (DTI): Offers data on the number of businesses in an area.
    • Local government: Lists of businesses, types of industries, and other local data.

    Market Share Forecasting

    • It uses market research to determine the quantity of sales a company can generate in a specific market segment.
    • Market share: The firm's individual sales expressed as a percentage of total sales in a specific market.
    • Steps for Determining Market Share Potential:
      • Define the physical limits of the target market area.
      • Determine potential sales in the target market.
      • Analyze the purchasing power of the target market.
      • Determine the total sales revenue of the industry.
      • Estimate the company's percentage of the total sales.
    • Calculation: CMS = CS / TIS
      • CMS = Company’s market share
      • CS = Company’s sales
      • TIS = Total industry sales

    Forecasting Company Sales:

    • Market-factor Analysis: Relates future product demand to market factors, measuring their impact on sales activity.
    • Survey of buyer intention: Asks current or potential customers about their purchasing plans.
    • Test Marketing: Introduces a new product in a limited geographic area to measure sales and project future sales.
    • Past Sales Analysis: Projects future sales based on a percentage increase from past performance or average sales over a few years.
    • Trend Analysis: Uses statistical methods to predict long-term sales with regression analysis or short-term sales using a seasonal index.
    • Sales-force composite: Collect sales estimates from individual salespeople for territories within the sales force.

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