FUNDAMENTALS OF MARKETING ASSIGNMENT

SUBMITTED TO, Ms. Shobha Menon Dept. of Management Studies ASIET, KALADY.

SUBMITTED BY, Rejitha C R S2 MBA Roll no: 36 ASIET, KALADY.

SNOWBALL SAMPLING

Snowball sampling is a non- probability sampling technique. Non- probability sampling focuses on sampling techniques that are based on the judgement of the researcher. Some populations that we are interested in studying can be hard -to-reach and/or hidden. These include populations such as drug addicts, homeless people, and individuals with AIDS/HIV, prostitutes, and so forth. Such populations can be hard-to-reach and/or hidden because they exhibit some kind of social stigma, illicit or illegal behaviours, or other traits that makes them atypical and/or socially marginalised. Snowball sampling is a non -probability based sampling technique that can be used to gain access to such populations.
Advantages of snowball sampling

Snowball sampling is a useful choice of sampling strategy when the population you are interested in studying is hidden or hard -to-reach. This includes populations that are subject to social stigma and marginalisation, such as suffers of AIDS/HIV, as well as individuals engaged in illicit or i llegal activities, including prostitution and drug use. Snowball sampling is useful in such scenarios because:
y It can be difficult to identifying units to include in your sample, perhaps because there is no obvious list of the population you are interested in. For example, there are no lists of drug users or prostitutes that a researcher could get access to, especially lists that could be considered representative of the population of drug users or prostitutes. y The sensitivity of coming forward to take par t in research is more acute in such research contexts. Individuals that are drug users or prostitutes, for example, are likely to be less willing to identify themselves and take part in a piece of research than many other social groups. However, since snowball sampling involves individuals recruiting other individuals to take part in a piece of research, there may be common characteristics, traits and other social factors between those individuals that help to break down some of the natural barriers that pr event them from taking part.

y The unknown and/or secretive nature of some social groups may also make it difficult to identify strata that warrant investigation. Strata are simply sub-groups within a population. In the case of drug users, it may be obvious to identify strata such as gender (i.e. male or female), types of drug user (e.g. causal, addict), and so forth, but other strata may be unknown to the researcher. Whilst is it typical to define the characteristics of the sample you want to examine at the start of the research process, the snowball sample may also be helpful in exploring potentially unknown characteristics that are of interest before settling on your sampling criteria. y There may be no other way of accessing your sample, making snowball sampling the only viable choice of sampling strategy.

Disadvantages of snowball sampling

Since snowball sampling does not select units for inclusion in the sample based on random selection, unlike probability sampling techniques, it is impossible to determine the possible sampling error and make generalisations (i.e. statistical inferences) from the sample to the population. As such, snowball samples should not be considered to be representative of the population being studied.

MARKETING MYOPIA

A short-sighted and inward looking approach to marketing that focuses on the needs of the company instead of defining the company and its products in terms of the customers' needs and wants. It results in the failure to see and adjust to the rapid changes in their ma rkets. Marketing myopia is an advertising strategy that does not focus on the needs and wants of consumers, but the desires of a company to sell specific goods or services in the economic market. Classic economic theory attempts to explain that consumers will tell companies the type of goods and services desired through the economic behavior demonstrated by individual consumers. Companies can benefit from this behavior by actively researching how

consumers are spending their money and what goods are service s are currently popular in the economic market. Marketing myopia can distort the companys view when managers focus more on what the company can produce rather then what consumers are willing to buy. A classic example of marketing myopia is seen by Ford Mo tor Companys development of the Edsel. The Ford Edsel was a late 1950s model passenger car built under the marketing strategy that it was going to revolutionize the automotive industry. The car was designed with the intent of being a large, stylish vehicle that would meet the driving needs for thousands of U.S. consumers and families. Although the Edsel was released with much fanfare and publicity from marketing agencies and media outlets, it was an almost immediate failure in the consumer market. While re views at the time cited the vehicles poor workmanship and styling, business experts have attributed the failure to marketing myopia and a failure to understand consumer desires. The name Edsel is now a business term synonymous with business or marketing failure. Marketing myopia may also occur when a business focuses on developing advertising strategies for wrong target markets or demographic groups. Individuals in the economic market usually view advertising strategies or techniques in different ways; their perceptions are built upon culture, race, age or other personal opinions. Companies that fail to understand the perceptions of consumers when advertising goods or services usually wind up with marke ting myopia. Companies in todays business environment often spend copious amounts of money conducting marketing research before releasing new products or services. This research or focus group activity may be related to the utter failure of the Ford Edsel marketing campaign. Rather than spending huge sums of money on national advertising or marketing campaigns, companies will use test markets to determine the strength of consumer demand for goods or services prior to a national rollout of new products. These test markets may also help companies build specific marketing strategies based on the feedback they receive from individual consumers. Any information gleaned can help companies avoid the terrible results of marketing myopia.

GE MATRIX

The business portfolio is the collection of businesses and products that make up the company. The best business portfolio is one that fits the company's strengths and helps exploit the most attractive opportunities. The company must: (1) Analyse its current business portfolio and decide which businesses should receive more or less investment, and (2) Develop growth strategies for adding new products and businesses to the portfolio, whilst at the same time deciding when products and businesse s should no longer be retained. The two best-known portfolio planning methods are the Boston Consulting Group Portfolio Matrix and the McKinsey / General Electric Matrix (discussed in this revision note). In both methods, the first step is to identify the various Strategic Business Units ("SBU's") in a company portfolio. An SBU is a unit of the company that has a separate mission and objectives and that can be planned independently from the other businesses. An SBU can be a company division, a product line or even individual brands - it all depends on how the company is organised.
The McKinsey / General Electric Matrix

The McKinsey/GE Matrix overcomes a number of the disadvantages of the BCG Box. Firstly, market attractiveness replaces market growth as the dimension of industry attractiveness, and includes a broader range of factors other than just the market growth rate. Secondly, competitive strength replaces market share as the dimension by which the competitive position of each SBU is assessed. In consulting engagements with General Electric in the 1970s, McKinsey and Company developed a nine-cell portfolio matrix as a tool for screening GEs large portfolio of strategic business units(SBU). This business screen became known as the GE/McKinsey Matrix and is shown below:

The GE/ M i ey mat i i similar t the BCG growth share matri i that it maps strategi busi ess units on a gri of the industry and the SB s position in the industry. Factors that Affect Market Attracti eness Whilst any assessment of market attracti eness is necessarily subjecti e, there are several factors which can help determine attractiveness. These are listed below: - Market Si e - Market growth - Market profitability - Pricing trends - Competitive intensity / rivalry - Overall risk of returns in the industry - Opportunity to differentiate products and services - Segmentation

- Distribution structure (e.g. retail, direct, wholesale )

Factors that Affect Business Position Strength

The horizontal axis of the GE/ McKinsey matrix is the strength of the business unit. Some factors that can used to determine business unit strength include: Market share Growth in market share Brand equity Distribution channel access Production capacity Profit margins relative to competitors

Strategic Implications

Resource allocation recommendations can be made to grow, hold or harvest a strategic business unit based on its position on the matrix as follows: Grow strong business units in attractive industries, average business units in attractive industries, and strong business units in average industries. Hold average businesses in average industries, strong businesses in weak industries, and weak business in attractive industries. Harvest weak business units in unattractive industries, average business units in unattractive industries, and weak business units in average industries. There are strategy variations within these three groups. While the GE business screen represents an improvement over the more simple BCG growth share matrix, it still presents a somewhat limited view by not considering interactions among the business units and by neglecting to address the core competencies leading to value creation. Rather than serving as the primary tool for resource allocation, portfolio matrices are better suited to displaying a quick synopsis of the strategic business units.

CONCENTRIC DIVERSIFICATION

When an organization takes up an activity in such a manner that it is related to the existing business definition, either in terms of customer groups, functions or alternative technologies, it is called concentric diversificatio n. This strategy involves eitherIntroduction of new products or services to serve similar customers in similar markets. Introduction of new products or services using technologies similar to the present product or service line. Concentric diversification is one of several different diversification strategies used by companies to increase their appeal to consumers. With this particular approach, the business will attempt to increase market share by introducing a range of new products that are likely to not only attract the attention of existing clients but also draw in new customers. Sometimes referred to as convergent diversification, the goal is to motivate current customers to keep purchasing the companys older products while also choosing to purchase the newer products. At the same time, the effort also brings in new clients who have no relationship with the older products, based on the appeal of the recently launched product line. This diversification helps a firm or any business in various ways: 1. Helps in developing new products 2. Provide various advantages while re -engineering existing products 3. Helps in increasing the market share of any firm or business
Types of Concentric Diversification

1. Market related concentric diversification: - When a similar type of product is offered unrelated technology. For example: A Co. manufacturing white goods enters into the field of consumer goods. 2. Technology related Concentric diversification: - When a new type of product or service is offered with the simila r technology. For example: A

firm offering hire purchase to institutional customers enters into providing home loans. 3. Market and technology related concentric diversification: - When a similar type of product is provided with related technology. For exampl e: A raincoat manufacturer makes waterproof shoes and rubber gloves to sell through same retail outlets.
Reasons for concentric diversification l Realizing financial synergies in terms of transaction cost savings and tax savings. l Realizing informational synergies by using common sources of information, databases and information networks. l Realizing operational synergies through economies of scale. l Realizing personnel synergies through utilizing human resource with common skills and competencies for another business. Advantages of Concentric Diversification

 Enable a firm to attain synergy by exchange of resources and skills.  To avail economies of scale and tax benefits.

Disadvantages of Concentric Diversification

Increase in risk and commitment. Reduction in flexibility.

CONGLOMERATE DIVERSIFICATION

According to Business Dictionary Conglomerate Diversification is a type of diversification whereby a firm enters, through acquisition or merger, an entirely different market that has little or no synergy with its core business or technology. Conglomerate diversification helps in strengthening the internal structure of a company and it is an essential form of diversification.

Based on the financial position, conglomerate diversification helps in evaluating the company`s portfolio. Here, the newly developed products are not directly related with existing technologies, markets and the products. This is more related to the financial condition and stability of the company. When two or more than two corporations are involved in different set of business in a single corporation structure, it is termed as conglomerate. These are large and huge companies. As always there are advantages and disadvantages in conglomerate diversification.
Advantages:

 Growth and earnings improve substantially,  There is a creation of internal capital markets,  Investment risk is considerably reduced.
Disadvantages:

Excessive burden on management leads to extra costs, Differences due to demographic variations lead to increased risks. There is a misbalance in focus. The core area of conglomerate diversification is to analyze the present financial position, compare it with the past financial performance, and to generate effective future outcomes. If the financials are healthy, the outcomes will be potentially good. Therefore, it is imperative to create a healthy and positive financials in order to create a better outcome. So many firms or businesses follow different strategies or a set of diversifications to be stable and strong to cater t o consumer needs and demands. Conglomerate diversification is an opposite of concentric diversification, and its focus is on financials and keep them evaluating to improve the financial position of the company. Philip Morris is a Conglomerate. This is a well known company which is also known as the parent company of Altria group.