Marketing Principles Assignment 1

Nguyễn Thị Kiều Anh - Snow - F05014Unit Outcomes Outcome Evidence for the criteria Feedback Assessor’s decision Verification Internal First attemp t wor k of the marketing process 1.1 E

BANKING ACADEMY, HANOI BTEC HND IN BUSINESS (FINANCE)

ASSIGNMENT COVER SHEET

NAME OF STUDENT Nguyễn Thị Kiều Anh - Snow - F05A

SUBMISSION DEADLINE 19 November, 2012

I, Nguyễn Thị Kiều Anh hereby confirm that this assignment is my own work and not copied or plagiarized from any source I have referenced the sources from which information is obtained by me for this assignment.

_19 th Novermber 2012

Signature Date

FOR OFFICIAL USE (Course Administrator)

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Nguyễn Thị Kiều Anh - Snow - F05014

Unit Outcomes

Outcome Evidence for the criteria Feedback Assessor’s decision Verification Internal

First attemp t

wor k

of the marketing process

1.1

Evaluate the benefits and costs of a marketing orientation for a selected organisation

2.1

Propose segmentation criteria to be used for products

in different markets

2.2

Choose a targeting strategy for a selected product / service

2.3

Demonstrate how buyer behaviour affects marketing activities in different buying situations

2.4

Propose new positioning for a selected product/

service

2.5

2

Outcome Evidence for the criteria Feedback Assessor’s decision Verification Internal

First attemp t

wor k

Re-Assignment

( ) Well-structured; Reference is done properly / is not done properly /should be done (if any)

Overall, you’ve passed / referral………outcomes

Areas for improvement:

 To achieve a pass, you must meet all the requirements defined in the assessment criteria

 To achieve a merit, you must identify and apply strategies to find appropriate solutions and appropriate methods/techniques as well as to present and communicate appropriate findings

 To achieve a distinction, you must use critical reflection to evaluate own work and justify

valid conclusions as well as to take responsibility for managing and organizing activities



ASSESSOR SIGNATURE DATE / 11 / 2012

NAME: Doti Chee

(Oral feedback was also provided)

STUDENT SIGNATURE DATE / /

Nguyễn Thị Kiều Anh - Snow - F05014

Prepared for:

Lecturer, Ms Doti Chee

Marketing Principle

Banking Academy, Hanoi

BTEC HND in Business (Finance)

Prepared by:

Nguyễn Thị Kiều Anh – Snow - F05A

Registration No ITPF05-014

No of words: 4200

Submission date: 19th November, 2012

TABLE OF CONTENTS

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EXECUTIVE SUMMARY 6

INTRODUCTION 7

CONTENTS 8

I Understand the concept and process of marketing 8

1.1 Explain the various elements of the marketing process 8

1.2 Evaluate the benefits and costs of a marketing orientation for a selected organization 11

II Be able to use the concepts of segmentation, targeting and positioning 13

2.1 Show macro and micro environmental factors which influence marketing decisions 13

2.2 Propose segmentation criteria to be used for products in different markets 18

2.3 Choose a targeting strategy for a selected product/ service 21

2.4 Demonstrate how buyer behavior affects marketing activities in different buying situations 23

2.5 Propose new positioning for a selected product/ service 29

CONCLUSION 33

REFERENCES 34

EXECUTIVE SUMMARY

This assignment contains basic knowledge of marketing as well as analysis and assess the most suitable and effective marketing strategies for Gatorade of PepsiCo in Vietnam This assignment is divided into seven parts as follows:

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Nguyễn Thị Kiều Anh - Snow - F05014

 Explain the various elements of marketing process which effect decision making ofPepsiCo

 Evaluate the benefits and costs of marketing orientation for PepsiCo

 Show macro and micro environmental factors which influence marketing decisions

 Propose segmentation criteria to be used for Gatorade in different markets

 Choose a targeting strategy for Gatorade

 Demonstrate how buyer behaviour affects marketing activities in different buyingsituations

 Propose new positioning for Gatorade

The recommendation for PepsiCo is that the company should do research about marketand its customers to have deeply understanding about them to meet their requirements.Therefore, the company will gain more achievements in business operation

INTRODUCTION

Starting with ordinary sources, PepsiCo still has survived after bankrupt twice andbecome the 2nd largest beverage company in the world Today, the global symbol of the Pepsi

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logo is one of the best known in over the world In 1991, Pepsi Corporation appeared inVietnam, through 15 years operate; the company becomes the leader in the term of sport drinkswith Gatorade product To have his success, Pepsi company have to set a specific marketingstrategy to approach Vietnam market For example, product’s tastes were changed slightly inorder to become more suitable for Vietnamese Marketing is an important part of anyorganization If an organization wants to attract consumer and moreover become a market leader,they must understand deeply about marketing concept to apply it effectively

This assignment focus on analyzing the most general aspects of marketing process such

as analyzing the factors which PepsiCo effect directly on marketing activities of PepsiCo orunderstanding buying behavior to build a appropriate marketing strategies to attract customers.The information in this assignment is collected from many different resources such as book,websites on the internet and some document which related to marketing knowledge and Gatorade

of PepsiCo in Vietnam

However, because of limitations about time, words, this assignment only gives generalinformation The researcher hopes that those disadvantages will be improved in the future

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Nguyễn Thị Kiều Anh - Snow - F05014

CONTENTS

I Understand the concept and process of marketing

1.1 Explain the various elements of the marketing process

1.1a Elements of the marketing process

1.1b.2 Internal environment

Understanding of the organization’s internal environment and its strengths andweaknesses will help PepsiCo recognize strong points to continue exploring, andweak points to overcome those shortcomings

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1.1b.3 External environment

Analyzing the opportunities and threats help PepsiCo take advantage ofopportunities to create more profits and recognize threats to minimize effects

1.1c Marketing strategy

1.1c.1 Porter’s five forces

Porter’s five forces include:

 Bargaining power of suppliers

 Bargaining power of buyers

 Threat of new entrants

 Threat of substitute products

 Rivalry among existing competitors

It is a yardstick for assessing industry profitability Five forces analysis helpsPepsiCo understand the competitive forces in beverage industry; and assess theattractiveness, growth opportunities within a new industry Base on these,PepsiCo can give effective strategies to raise the profitability, power andcompetitive position

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1.1c.3 Ansoff’s Product/Market Matrix

Ansoff’s Product

Ansoff’s four strategies are tools used within marketing were developed by Igor Ansoff

in 1957 It enables business to decide growth strategy depends on whether to sell new

or existing products in new or existing markets

1.1d Marketing mix decision

According to Stanton, marketing mix is a combination of four elements (4Ps): product,place, price, and promotion Marketing mix play an important role in the firm’senterprise The purpose of marketing mix is to satisfy customer’s needs and wants bycreating products with innovative features in right place, with reasonable price andflexible promotion

1.1e Implementation & control

Implementation and control is last step in the marketing process which is considered asthe result of process of building marketing strategy After implementing plan, the firmcan evaluate whether the marketing strategy meet customer’s demand or not Base onthis, the company will adjust it become more suitable to reach objectives

In conclusion, defining elements of marketing process will help company know ways to analyze,evaluate and form marketing strategies effectively Therefore, understanding the marketingprocess is essential to organization success

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1.2 Evaluate the benefits and costs of a marketing orientation for a selected organization

1.2a Basic concepts of marketing orientation

There are 5 alternative concepts

 Production concept: “The philosophy that customers will favor products that are

available and highly affordable and that the organization should therefore focus onimproving production and distribution.” (Kotler & Armstrong, 2010)

 Product concept: “The idea that consumers will favor products that offer the most

quality, performance and features and that the organization should therefore devoteits energy to making continuous product improvements.” (Kotler & Armstrong,2010)

 Selling concept: “The idea that consumers will not buy enough of the firm’s

products unless it undertakes a large-scale selling and promotion effort.” (Kotler &Armstrong, 2010)

 Marketing concept: “The marketing management philosophy which holds that

achieving organizational goals depends on determining the needs and wants of targetmarkets and delivering the desired satisfactions more effectively and efficiently thancompetitors do.” (Kotler & Armstrong, 2010)

 Societal marketing concept: “The idea that the organization should determine the

needs, wants, and interests of target markets and deliver the desired satisfactionsmore effectively and efficiently than competitors in a way that maintains orimproves the consumer’s and society’s well being.” (Kotler & Armstrong, 2010)

1.2b Marketing orientation for PepsiCo in Vietnam

Marketing concept is the most suitable marketing orientation for PepsiCo’s Gatorade

in Vietnam The reason is that applying marketing concept will help PepsiCo defineways to approach Vietnam’s market and then understand customers’ needs and wants

to satisfy them as efficiently as possible To analyze exactly the costs and benefits ofmarketing strategy, the researcher has based on some factors in the following table:

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electrolytes,carbohydrates andgreat tastingflavors (According

researching,and using morematerials

Multi-choicesfor customer,satisfies

individual

people Shouldinvest

youth, especiallyhigh-performanceathletes

- Psychographicsegmentation:

suitable for peoplewho like toexperiment withnew flavors, likesports

- Help firms seeopportunities in themarket through theanalysis needs ofeach customergroup

- Create productsbetter than its rivals

segmentation

Definingexactlylocation, targetcustomers isvery important

- Costs forcustomerservices

Indentify whatcustomer need

is a good invest

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- Customer loyalty - Build customer’s

trust

- Customers willbuy more andintroduce to theirfriends

- Spend moneyand time foradvertising,agents,commission,and initialdiscount

Branding

Gatorade: Buildfamous brand(According to thecase study - Thethirst quencher)

- Attract customers

- Build reputation,and loyalty

advertising,designing

Need investbecause thevalue of thebrand is long-term

From above analysis, it is not difficult to recognize that the costs for applying marketing conceptare not small but the benefits that it brings are very big and long-term Therefore, there is nodoubt that when marketing concept is applied, PepsiCo will become the market leader and makeits competitors relegate not only Vietnam but also many countries in over the world

II Be able to use the concepts of segmentation, targeting and positioning

2.1 Show macro and micro environmental factors which influence marketing decisions

2.1a Environmental factors

Marketing activities of any businesses is affected by many factors, that factors form afirm’s business environment Marketing environment includes macro and microenvironmental factors

 The micro environment consists of factors that are closely related to business Itincluded internal environment (stakeholders, 7S) and external environment(Competitors) These factors directly impacts on the operation of the business andfirm also has a certain influence on these factors

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 PepsiCo need train and promote so that staff hasthe opportunity to express their maximum ability ingiving marketing strategies.

 To be continued investing by shareholder,PepsiCo committed to build shareholder value bymaking PepsiCo a truly sustainable company(According to Scenario)

 To attract customer, PepsiCo must base on eachperson’s hobby, financial situation, and their habits

to produce diversified products with reasonableprices

$250million in Vietnam over next three years(PepsiCo, n.d.)

PepsiCo’s current structure:

- “Decentralized organizational structure”

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7s

Structure

- “Empowerment to its employees”

Due to the expansion and growth of PepsiCo, theymust add new senior-level workforce to takeadvantage of opportunities (Christopher, n.d.)

Competitors

Threat of substituteproducts

There are many kinds of sport drinks in the market.Threat of substitute products is high Therefore, toattract customers besides improving the quality ofproducts, PepsiCo also has to apply right strategies

in prices

The rivalry amongstcurrent competitors inthe industry

There is a lot of beverage companies with big andsmall sized such as Coca Cola, Red Bull, Samurai,ect Therefore, the competitive rivalry is high

 PepsiCo want to exist in this environment, theymust have competitive action such as: advertisingbattles, introducing new products for the market,providing guarantees or warranties

SWOT ANALYSIS

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 Branding: famous, loyalty (according to

Inter brand, it ranked 26th amongst top

All company operate in Vietnam must comply with government obligations such

as tax policy, political stability (John, n.d.)

 Accordingly, PepsiCo must pay 25% for income tax Besides, they have toobey regulations about environmental protection, and employment laws

Nguyễn Thị Kiều Anh - Snow - F05014

 Increase population

 Changing social trend

 New market when Vietnam joins WTO

 Intense competition: PowerAde of Coca Cola company

 Imitators

 Government regulations

In short, that is effects of marketing environment on PepsiCo in Vietnam These effects createboth opportunities and threats for PepsiCo Therefore, the task of marketer is to carefully analyzethe changes of the environment to know strengths to explore, and weaknesses to overcome thenmake accurately marketing decisions to bring revenue for the company

2.2 Propose segmentation criteria to be used for products in different markets

2.2a Segmentation

 Definition of segmentation

Market segmentation is “the subdividing of a market into distinct and increasinglyhomogenous subgroups of customer, where any subgroup can conceivably beselected as a target market to be met with a distinct marketing mix” (Kotler, 1994)

 Types of market segmentation

There are 2 type of segment market:

- Consumer market segmentation

- Industrial market segmentation

2.2b Base for segmentation

 Consumer market

There are many ways which consumer market can be segmented; these are Geographicvariables, demographic variable, psychographic variable, and behavioral variable To

suitable with given strategy, marketer chooses demographic variable to become main

way to segment the Vietnam market

 Industrial market

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