strategic marketing ebma 3715 unit 16 (chapter 16)

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Completion of UNIT 16 Handing out of Semester Test 2 Remarks and queries

NO CLASS NEXT WEEK ( 27 April-1 May) Work on your TATA Presentations

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International MarketingUNIT 16

GOING INTERNATIONAL

Domestic vs. International marketing

International marketing is marketing across national borders, to: evaluate the dynamic environment for opportunities and threats develop market offerings lead to the satisfaction of customers’

needs and wants achieve the objectives of the enterprise, the consumer and

society.

Challenges of International Marketing (pg. 592)

THE INTERNATIONAL ENVIRONMENT (pg. 594-606)

Complexity of International Markets

YOUR SCENARIO

Benefits of International Marketing (pg. 593)

Increase sales Increased profits Reduced risk Lower unit cost Economics of scale Reducing seasonal fluctuations Extending the product life cycle Improved efficiency and product quality Untapped markets Access to foreign finance Status as an international marketer

• To gather information about a market’s size, trends and general attractiveness as a possible target market.

• To evaluate the appropriateness or suitability of the marketing offering of the firm for the selected target market

Researching International Markets

Pages 618-640

The International Marketing Mix

Similarity or diversity of the markets, language barriers, cultural differences, local advertising agency standards, the media mix

•Competitor, cost or demand orientated?•Differential pricing strategy •Market orientated international pricing•Other pricing strategies

Sell the same product using the same promotional message worldwideModify product but retain uniform promotional messagesModify both product and promotional messageInvest in and develop a totally new product for the export market

Do you:•Sell and deliver directly to the end user; or•Sell through intermediaries

Factors Favouring PRODUCT

STANDARDISATION Production gives rise to economies of scale Standardised products permits amortisation of

development costs Requires additional records and stock audits Products are likely to be affected by cultural

and environmental differences Essential to consumer acceptance where

products are of relevance Must achieve uniformity with the standardised

product Homogeneous products don’t require

modifications

Factors Favouring PRODUCT

DIFFERENTIATION Maximising profits is the driver behind modification of products Differing consumer tastes influence design and manufacture of

products Inadequate consumer buying-power requires a low price and reduction

in quality Variations in national conditions Low technical ability- product simplified Tariff levels may dictate local manufacture or assembly Government taxation policies may necessitate change to product Varying road and traffic conditions Change in climate conditions If product is perceived as new– may have to be adapted to overcome

resistance Local labour costs may influence level of automation production process

Semester Test 2Football Factory and Cheeki Cherry

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SEMESTER TEST 2

MEMO: SEMESTER TEST

2REMARK QUERY:-Indicate the section and question number on the top of your answer sheetTEST TOTAL: 50

QUESTION 1 (9 MARKS)

Test 2 MEMOA product is more than what is seen by the eye, it includes everything the consumer receives in an exchange.

1.1. Using the classification of consumer products as a guideline, classify the type of

product that Kia offers the consumer market. Motivate your answer.

DURABLE PRODUCT ½ Consumers buy a car once/ lasts long (more than 3 years) () Duursame produk ½ Word gebruik vir langer as 3 jaar ()

OR SHOPPING PRODUCT () Inkopie produk As consumers will go to more effort to purchase and will compare prices and brands before making a final choice. ()

OR SPECIALTY / SPECIAL PRODUCT () Spesialiteitsproduk Products that the consumer wants for personal satisfaction and with unique characteristics (7 year warranty) ()

[1+1=2]

1.1. Indicate each layer of the product concept and explain how Kia has strategically addressed each layer, in order to create valuable offerings for the market.

Many examples have been indicated on this memorandum. A student only needs to provide ONE example PER PRODUCT LAYER.

CORE PRODUCT (½) KERN PRODUK Transportation / Reliable means of transportation / trust and security () TANGIBLE PRODUCT (½) TASBARE PRODUK Kia branding / the actual car / new car designs / great quality / affordable and quality cars / standard with electric windows, trip computer etc. () AUGMENTED PRODUCT (½) TOEGEVOEGDE PRODUK Seven year warranty / service plan / exceptional customer service / () POTENTIAL PRODUCT (½) POTENSIËLE PRODUK (students need to think out of the box) Solar powered cars range / scooters () PRODUCTION / PRODUCT IMAGE (½) PRODUKSIE BEELD Trusted and secure brand / affordable brand / an image of great quality and design

/ affordable yet stylish. (½) [(1 ½ x4) +1= 7]

1.2.

QUESTION 2 (7 MARKS)

2.1. Explain any three (3) benefits that Kia may experience, due to their brand.

2.2. Different brands project different values to consumers. Identify the brand value that Kia has emphasized in its new branding strategy. Motivate your answer by referring to the case study.

Any ONE of the following:

DIFFERENTIATION VALUE () Differensiasie waarde - as they strive to be the first to offer quality, great design / stylish, additional features, and a brilliant service plan / 7-year warranty at a better price / competitive prices than any competitor. ()

OR

FUNCTIONALITY VALUE () Funksionaliteitswaarde - Kia has emphasised its 7-year warranty, which is their unique selling point. ()

OR

RISK REDUCTION VALUE () Risko verlaging/afname waarde - Kia has emphasised its 7-year warranty, which is their unique selling point. ()

[1+1=2]

2.3. Identify two (2) brand elements that Kia has used to help the company distinguish its offerings in the market place.

Any TWO of the following:

Brand name: Kia () / Logo () / Slogan: The Power to Surprise ()

[1+1=2]

QUESTION 3: (6 MARKS)

3.1. Identify one (1) internal factor that has impacted Kia’s pricing strategy. Justify your answer.

Marketing / Organizational/ Brand Goals or Objectives () Bemarkingsdoelwitte

o Kia’s new growth plan has several marketing objectives in mind / to increase demand – thereby helping to meet the objective of growth / Kia had to revise their entire marketing mix / repositioning of Kia / striving to be the first… ()

OR

Organisational Costs / Organisasie koste

[1+1=2]

3.2. Identify one (1) external factor that has impacted Kia’s pricing

strategy. Motivate your answer. Any ONE of the following combinations:

COMPETITION () Mededingende nabootsing - Kia is aiming to set the standard for

competitors, as they strive to be the first to offer quality, great design, additional

features, and a brilliant service plan at a better price than any competitor / evident in

mature markets such as the car market. The car market, in particular, has a large

number of long established brands- barrier of entry/ competing mainly on price ()

OR

CONSUMER BEHAVIOR () Verbruikergedrag - Since consumers purchasing cars are often

comparing prices, this serves as a competitive advantage for Kia ()

[1+1=2]

3.3. Specify the pricing strategy implemented by Kia. Motivate your answer.

COMPETITIVE PRICING OR LEADERSHIP PRICING () Kompeterende pryse

Kia is aiming to set the standard for competitors, as they strive to be the first to offer quality, great design, additional features, and a brilliant service plan at a better price than any competitor /initially the Kia Company entered the market as an affordable car brand, competing mainly on price, by using a competitive pricing strategy. ()

[1+1=2]

QUESTION 4: (10 MARKS)

4.1. Identify all the participants/members in Kia’s distribution channel. Refer to the case study to motivate your answer.

MANUFACTURER / PRODUCER (½) - Kia Motors / 12 manufacturing and assembly plants and subsidiaries in 165 countries around the world (½)

RETAILER (½) - Kia Dealerships / 755 dealerships (½)

CONSUMER (½) - Individuals who has purchased a Kia vehicle (½)

[½ x 6= 3]

4.2. Identify three (3) activities or functions that the channel members (identified in question 4.1.) have performed, on behalf of Kia Motors.

ANY 3 OF THE FOLLOWING: [3 x 1 = 3]

- Intermediaries close gaps and provide utility

- Intermediaries resolve discrepancies

- Intermediaries reduce transactions - Intermediaries synchronise needs, do bulk breaking and re-assort product

offerings - Gather information about potential and current customers, competitors etc. - Develop persuasive communication to stimulate purchasing - Reach agreement on price and facilitator transfer of ownership - Place orders - Assume risk - Provide storage and movement of physical goods - Provide for buyer’s payments through banks - Oversee transfer of ownership

Tussengangers sluit gapings en verskaf nut Tussengangers los teenstrydighede op Tussengangers verminder transaksies Tussengangers sinkroniseer behoeftes, doen grootmaat breking en hersorteer

produkaanbiedings

4.3. Classify the distribution structure decision made by Kia. Motivate your answer.

SELECTIVE DISTRIBUTION () Selektiewe distribusie

Appropriate when the objective is DIFFERENTIATION, since Kia aims to differentiate themselves from competitors / Kia has more than 755 dealerships. Since its 1994 introduction, Kia has conducted a methodical market-by-market rollout of dealerships who provide exceptional customer service. ()

[1+1=2]

4.4. Indicate whether Kia uses a push or pull strategy to stimulate demand. Motivate your answer.

PULL STRATEGY () Trek strategie

All promotional initiatives are directed to the consumer /

Kia uses conventional techniques such as television, print, digital and social media advertising campaigns alongside extensive use of sports marketing such as sponsorship. They also produce online banner advertisements, place advertisements on billboards and use their website to meet the needs of their consumers. ALL BENEFITS ARE FOR THE CONSUMER- warranty, design etc. ()

[1+1=2]

QUESTION 5: (20 MARKS)

5.1. Identify the objective of Kia’s latest television advertisement. Motivate your answer by referring to the case study.

INFORM / PERSUADE / CREATE AWARENESS / ESTABLISH AN IMAGE ()

Inlig/Oorreed

television campaign which is focusing on building emotional connections with consumers with a goal to show consumers “how it feels” to drive a Kia. It depicts ‘real drivers’ describing what they want from their car, emphasising the 7 year warranty which can be found with no other company but Kia. ()

[1 x 2 = 2]

5.2.1. There are various levels/types of sponsorship. Indicate the level/type of sponsorship that Kia has used. Motivate your answer.

MULTI-SPONSORSHIP () Multi-borgskap (Only option- no marks for international/ team/ cultural- as it shows the student could identify the “bigger picture) Kia does not only sponsor an event, but causes, national teams, places, cultural events etc. ()

If the student only mentions ONE particular sponsorship – E.g“FIFA World Cup and UEFA Championships” / “South African Music Awards”- then only (½)

[1+1=2]

5.2.2. Identify three (3) sponsorship objectives that Kia has pursued with their various sponsorship initiatives. Motivate your answer by referring to the case study.

One mark for identifying the sponsorship objective and one mark for the case

reference. Any THREE of the following combinations: SPONSORSHIP OBJECTIVE CASE REFERENCE

Reinforce, enhance or alter brand image / Strengthen a corporate image / Positive Associations () Versterk, verbeter of te verander handelsmerkbeeld

By associating with exciting and interesting causes, events, teams and individuals; Kia shows that it is also exciting and interesting. ()

Create an opportunity for product sampling and trial()Geleentheid vir die produk beproewing

By being the official vehicle partner of the SA music awards. ()

Forge new links with opinion leaders / Create Positive Associations ()Smee bande met opinie leiers

Rafael Nadal is Kia's global ambassador. ()

Reach Larger Audience / Create Awareness / Gain competitive advantage

By sponsoring the events, teams etc. Kia is “out there” and is exposed to more people, hence creating awareness.

[3 x 2=6]

1. Content () Kia has provided online users with exclusive and up-to-date content. Take a look at the Kia Facebook page, for example, which keeps followers informed about the latest car debuts, such as the new-generation Kia Optima. ()2. Community () Kia actively uses it’s blog to interact with their loyal community of blog followers, who use the blog as a forum for car lovers to share their opinions. Kia is dedicated to responding to and sharing users’ comments on the blog’s homepage. ()3. Communication () contact dealerships / Kia is dedicated to responding to and sharing users’ comments on the blog’s homepage. ()

4. Commerce () A recent addition to Kia’s digital marketing initiatives is their QR code campaign. Users who scan the Kia QR code are transferred to a mobile friendly version of their website, where users can customise the colour of their ordered vehicle, contact dealerships and even register for a test drive. ()

CHEEKICHERRI and Football Factory

Feedback

WELL DONE: In-depth analysis on the

content, structure and appearance.

Brilliant, practical and feasible recommendations for improvement and stickiness. Detailed and specific!

Clear “How-To” guidelines for additional social media campaigns

MARKS LOST:Poor analysis of the website. Too vague.Recommendations were not practical and not linked to the core business.Social media campaigns- Too vague. Must specify how, what will it contain, who will it target etc.