SQA Higher Business Management Management of Marketing: a complete overview of customers, market research, the extended marketing mix and technology

What Management of Marketing actually demands

Management of Marketing is the first functional area of Higher Business Management. It is about how a business identifies and satisfies its customers profitably. The SQA expects you to start from the customer (segmentation and research) and then build a marketing mix to reach them, and at Higher that mix has seven Ps, not four. Strong answers apply the models (the life cycle, the Boston Matrix, the pricing strategies) to a scenario rather than just defining them.

This guide walks through the whole area, then sets out how the SQA examines it. Each topic has a matching dot-point page with practice questions; this overview ties them together.

Customers, segmentation and research

Marketing begins with the customer. A market-led firm researches and responds to customer needs, rather than a product-led firm that makes first and sells later. Firms divide the market through segmentation (by age, gender, income, location and lifestyle) and pick a target market, then build customer loyalty for repeat sales and lower costs. To find out what customers want, they use market research: field (primary) research (surveys, interviews, focus groups, observation, test marketing) and desk (secondary) research (statistics, reports, internal records), choosing a representative sample.

The extended marketing mix

The marketing mix is the combination of elements a firm controls to satisfy customers. Higher uses the seven Ps:

• Product: the product portfolio, the life cycle and extension strategies, the Boston Matrix, branding and packaging.
• Price: pricing strategies (cost-plus, competitive, penetration, skimming, promotional, premium, destroyer, loss leader, psychological), matched to the situation.
• Place: channels of distribution (direct, retailer, wholesaler) and the growth of e-commerce.
• Promotion: advertising, into-the-pipeline and out-of-the-pipeline sales promotions, public relations and personal selling.
• People, Process, Physical evidence: the three extra Ps that matter most for services.

Technology in marketing

Technology has reshaped every element: e-commerce and websites widen the market, social media and e-marketing promote cheaply and directly, and customer databases allow personalised, targeted marketing. The benefits are reach, low cost and data; the drawbacks are cost, competition, fast-spreading bad publicity and data-protection duties.

How Management of Marketing is examined

A typical SQA profile for this area:

• Apply the models. Use the product life cycle, Boston Matrix and pricing strategies on a given product, not in the abstract.
• Remember seven Ps. Higher expects people, process and physical evidence, especially for services.
• Match strategy to situation. Penetration versus skimming, loss leader versus destroyer, mass versus niche, depending on the scenario.
• Discuss both sides. Weigh advantages and disadvantages of a channel, a promotion or a technology.

Check your knowledge

A mix of recall and explanation questions covering Management of Marketing. Attempt them, then check against the solutions.

1. Name three bases a firm could use to segment a market. (3 marks)
2. Distinguish between field and desk research. (2 marks)
3. Name the five stages of the product life cycle in order. (2 marks)
4. Distinguish between penetration pricing and price skimming. (2 marks)
5. Name the three extra Ps of the extended marketing mix. (3 marks)
6. Give two benefits of using technology in marketing. (2 marks)