Contemporary Strategic Marketing

Second edition

by Ross Brennan, Paul Baines, Paul Garneau and Lynn Vos

Discussion questions

Chapter 1

  1. What distinguishes strategic business decisions from tactical business decisions?
  2. What is meant by competitive strategy, and how does it differ from corporate strategy?
  3. What are the key characteristics of strategic marketing?
  4. What is a ‘forecasting and budgeting’ approach to marketing planning, and how would you differentiate it from strategic marketing?

Chapter 2

  1. Distinguish between needs, wants and desires. Do marketers have the power to create any of these?
  2. Discuss the effects of globalisation on culture. Is this becoming a matter of concern for all marketers and all product categories?
  3. How can the models of consumer behaviour presented in this chapter be adapted to include the recent developments involving online shopping and consumption behaviours?
  4. Appropriate positioning has been presented as an essential strategy for organisations wishing to prosper in the marketplace. Discuss the future prospects of unbranded goods and services in this context.
  5. Discuss the ethical challenges faced by responsible marketers in terms of such deviant behaviours as compulsive buying, bingeing, addictive gambling and so forth.

Chapter 3

  1. How does an understanding of the organisational buying process assist in the formulation of marketing strategy?
  2. Organisational markets are very diverse. However, in many organisational markets demand is concentrated in the hands of comparatively few buyers. How does this affect marketing strategy?
  3. Changes in the marketing environment have persuaded some influential commentators that business-to-business marketing strategies have to become more relationship oriented. What environmental changes have brought this about, and what does it mean to be more relationship oriented?

Chapter 4

  1. Consider the consumer market for petrol (that is, sales of petrol to private motorists rather than companies). Explain the significance of each of the following aspects of the competitive environment for the petrol marketing strategies of the oil companies.
  2. World oil production is largely controlled by a small number of countries that are
    members of OPEC (the Organisation of Petroleum Exporting Countries), an organisation that aims to control world oil production and manage price fluctuations.
  3. Suppose that petrol costs US$2 per litre. The government imposes a tax increase of 10 cents per litre, and all the oil companies simultaneously raise the retail price of petrol to $2.20 per litre. They notice that there is a 1.5 per cent reduction in demand as a result of this price increase.
  4. Consumers regard petrol as close to a commodity product – competing products are regarded as good substitutes for each other.
  5. Governments frequently impose high levels of duty on petrol.

Chapter 5

  1. What is the likely impact of the ageing population on organisations operating in the health sector?
  2. The managing director of a medium-sized manufacturer of industrial lighting systems, based in Newbury (England), wants to know how her business would be affected if the UK adopted the euro. Her firm exports over 50 per cent of its output, mostly to European Union countries. Advise the managing director.
  3. The managing director is so impressed by your advice that she now wants you to help her to assess the importance of a number of environmental factors, as set out in Table 5.2. Prepare an environmental priorities matrix from this information and suggest what the firm should do next.

Chapter 6

  1. Companies that adopt a formal approach to marketing planning tend to perform better in terms of key marketing and financial indicators than companies that do not. Does this prove that the adoption of formal marketing planning causes improved financial performance?
  2. The marketing director of a local firm explains the following to you: ‘We have invested a lot of money in improved customer service. Over the past six months we have cut the average length of time customers have to wait on the phone to speak to a customer service representative in half, from two minutes to one minute. I would say that customer service was obviously a key strength of ours.’ What else would you need to find out to establish whether customer service is really a strength?
  3. The marketing director goes on to explain that sales revenue for the past six months was very close to target, even though the company has lost several market share points over the period. Explain how this could have happened, using the language of sales variance analysis.
  4. Our enthusiastic marketing director goes on to explain that he has recently invested in a customer database system which will allow him to track customer demand and improve his direct mailing effectiveness considerably. All the costs associated with the system were incurred last month, and amounted to £75,000. It is expected that additional business generating profits of £35,000 for each of the next three years will be created by using the system – which will then be obsolete and have no residual value. Does the system look like a good investment? (Use a 10 per cent discount rate.)

Chapter 7

  1. Market segmentation is often based on directly observable characteristics of customers and potential customers, such as the age and sex of consumers, or the turnover size andindustry sector of companies. What are the advantages and disadvantages of such segmentation methods when compared with segmentation based on buying behaviour characteristics?
  2. A friend of yours, who is a successful entrepreneur, says to you: ‘You’re wasting your time with all this strategic marketing theory. I don’t know a dog from a cash cow, and I wouldn’t know a differentiation focus strategy if I tripped over it in the street. But my business seems to be doing fine!’ What arguments would you use to persuade your friend that strategic marketing models can play a valuable role in business?
  3. Table 7.5 shows data relating to the product lines of an office equipment company. Draw up an accurate BCG growth/share matrix for this product portfolio. What observations do you have about the balance of this portfolio?
  1. Autobits Ltd manufactures speedometers and tachometers for use in motorcycles, selling these directly to Japanese bike makers Honda and Suzuki. The firm’s management has identified a number of alternative strategic options to develop the business. The sales director wants to generate more sales by investing greater efforts in developing the relationships with Honda and Suzuki. The marketing director advocates developing new relationships with Harley Davidson in the USA and the UK firm Triumph. The managing director joined the company from General Motors and is inclined to look for new business from automobile manufacturers. The production director believes that it would make sense to sell additional equipment, such as fuel gauges, to Honda and Suzuki. Explain all these options using the Ansoff growth vector matrix.

Chapter 8

  1. Would you say that relationship marketing was either a philosophy of marketing or a marketing strategy, or both these things, or neither?
  2. Suggest a number of examples of marketing exchanges, starting with a discrete transaction and moving progressively towards a relational exchange.
  3. What problems might you have to overcome, as a full-time professional marketer in a service organisation, in engaging the ‘part-time marketers’ fully in your marketing strategy?
  4. Taking the example of business-to-business marketing, explain how the decision whether or not to use a relationship marketing approach is based on an understanding of buying behaviour.

Chapter 9

  1. How is the ‘many-to-many’ environment described in this chapter so different from the more traditional ‘one-to-many’ approach?
  2. Why do you think the World Wide Web is currently more attractive to e-marketers than most other non-traditional tools?
  3. ‘ICTs have impacted B2B marketing mix strategies differently than B2C marketing mix strategies.’ Discuss this statement.
  4. When a researcher sets out to compare a number of similar websites using preselected criteria, is this considered primary or secondary data collection? Justify your answer.
  5. Can e-marketing be useful to any sort of business? Why or why not?

Chapter 10

  1. Using the concepts outlined in this chapter, describe the key characteristics of the service provided by a hairdressing chain.
  2. Outline the extended services marketing mix for:
    (a) A cancer charity
    (b) A no-frills airline service such as Ryanair or easyJet
    (c) A telecommunications company aimed principally at the business customer.
  3. Discuss which market segmentation bases might be applicable to:
    (a) A political party segmenting the electorate for voters
    (b) A car-hire company, specializing in company car leasing.
  4. Draw a relationship pyramid for a major international football club, such as Manchester United or Real Madrid. Explain the nature of the loyalty of the customers/consumers/ supporters.

Chapter 11

  1. The overall value of sales of UK textile and apparel manufacturers has been declining over the past ten years. Consider what conditions either at home or abroad might be responsible for this decline and suggest ways that sales may be increased.
  2. Outline a series of steps that a company that is planning to invest in foreign markets should follow. Discuss what factors should be considered at each stage.
  3. Explain what might be the problems associated with following a reactive approach to internationalisation.
  4. Assume that your company is planning to invest in a developing country known to have high levels of political, economic, commercial and demand-level risks. Consider ways to deal with or minimise these types of risk.