UGB161 Introduction to Marketing Assessment Sample
Introduction
Marketing is referred to as the set of activities that are being undertaken by the business organisation to communicate, deliver and exchanging offerings that intend to offer values for the customers.
Marketing helps the business entity in promoting their products and services among the customers that help them in growing their reputation among them and make them loyal towards the firm.
The report in the initial section will discuss the current business performance of M&S along with determining their current marketing strategies. Two sets of segmentation in regards to M&S will be examined including demographics and psychographics that will benefit the firm in identifying their target customers. The report will also examine the buyer decision-making process followed by laying down concurrent recommendations that will help the firm in grow their business in the competitive business environment.
Overview of Marks and Spencer
Marks and Spencer is a UK based British multinational retailer with its headquarter situated in London. The retail organisation specialises in selling clothes, home products and food products, most of their brand label. M&S was founded the year 1184 by Micheal Marks and Thomas Spencer, currently, the firm operates in all the over the UK through their 959 stores (Marksandspencer, 2021).http://UGB161 Introduction to Marketing Assessment Sample The organisation also offers online food delivery service through Ocado retail.
During the year 2020, the company earned revenue of £ 10,181.9 million and operating income of £ 254.8 million in the same year. The total number of employees that are currently working in the business enterprise is 80,000. The company also enjoys a market share of 3.1% in the United Kingdom’s grocery market, that is a decrease of 0.2% from the previous year 2019 (Statista, 2020). http://UGB161 Introduction to Marketing Assessment Sample
The company is also heavily involved in CSR activities that include Look Behind the Label marketing campaign. The campaign aimed to highlight the customers about the various ethical and environmentally friendly aspects of the production and sourcing methods of M&S. Beside, the firm has also launched the Forever Fish campaign that campaign is focused towards promoting the protection of marine wildlife in the UK.
Figure 1: Top 10 clothing market shares in the UK
Source: (Statista, 2020)
Current business performance of M&S
Based on the evidence of Bbc, (2020), it has been identified that Marks & Spencer suffered their first loss in its 94 years of business establishment as the global pandemic of COVID-19 hit the company.
The company recorded a loss of £ 87.6 million, compared with profits of £ 158.8 million in the same period last year. The significant loss that the company suffered made the organisation to undertake the decision of cutting down 7,000 jobs over three months (Theguardian, 2020). http://UGB161 Introduction to Marketing Assessment SampleThe overall sales for the six months across the group slid by 15.8% to £ 4.09 billion, the factors contributing to downgrade sales of the organisation is impacted due to their lower clothing and home sales.
The firm also had to shut down 600 stores all across the UK due to the amount of loss the firm suffered due to poor sales of the organisation over the period (Bbc, 2020). M&S tie-up with Ocado retail helped the organisation in starting delivering M&S food at the start of September 2020. The partnership with Ocado has turned fortune for the organisation as the sales in clothing and general merchandising of M&S has increased by 4%.
Figure 2: M&S store closures
Source: (Bbc, 2020)
Current Marketing strategy
The current marketing strategy of M&S includes product marketing, during the year 2019, Marks and Spencer overhauled its marketing strategy last year to focus more on product and investment into digital and social channels.
The marketing strategy of product marketing is also appropriate for M&S considering the situation that food sales declined by 2.1% and clothing and home sales fell by 2.4%, that has led to drop-in group revenue of 3.9% to £ 3 billion (Thedrum, 2019).http://UGB161 Introduction to Marketing Assessment Sample
Earlier the organisation used to focus on a TV advertisement, lack of connection with their target customers made it difficult for M&S to market their products as a result of which the firm had to suffer huge losses. The current marketing strategy of M&S product marketing benefits the firm in ensuring that the products that are being offered to the customers are of the highest quality, it also ensures that hero-products that are being shown in the ads are available in the stores.
The product marketing strategy also aids M&S in strengthening its supply chain that effectively contributes to the growth of the organisation (Marksandspencer, 2020).http://UGB161 Introduction to Marketing Assessment Sample Focusing on product marketing helps the firm in offering discounts and offers to the customers that make it easier for the UK based retail firm to attract the customers towards the firm and make them loyal towards the organisation.
Segmentation
Demographic segmentation
Demographic segmentation is known as the process of dividing the market into segments based on their age, gender, income and religion. Demographic segmentation benefits the marketers in spending their advertising and marketing budget more efficiently (Gajanova, et al., 2019).http://UGB161 Introduction to Marketing Assessment Sample
M&S uses demographic segmentation to identify their target customers such as the grocery items and food items that are being offered by M&S has been categorised based on the specific age group and gender of the people. The target market in demographic segmentation for M&S falls in the age category of infant children to 65-year-old senior citizens.
The large product portfolio of M&S has been categorised based on the specific needs and demands of the customers that help the firm in improving their reputation among their target customers (Marksandspencer, 2021).http://UGB161 Introduction to Marketing Assessment Sample Product marketing for specific target groups is being designed accordingly by M&S based on the age group that influence them to visit the stores of M&S and make their purchase decisions. Demographic customers will be benefiting the organisation in improving their product line and the quality of their products.
In demographic segmentation specific products are being designed for individual target segments, therefore based on their personal experience of the products the customers will be giving feedbacks to M&S that will help them in improving the quality, size and taste of the products.
Customers will also offer their suggestions as to how the products can be designed that will meet their expectations. The target customers of demographic segmentation will also allow the UK based retail firm in optimising their marketing strategies that will contribute towards their growth and help the firm in achieving high growth and revenue (Camilleri, 2018).http://UGB161 Introduction to Marketing Assessment Sample
Besides, understanding the demographics of customers will also allow the organisation to develop customised products and services that will generate competitiveness for them in the UK business environment helping them in eliminating the threat of competitors and new entrants.
Psychographic segmentation
Psychographic segmentation is referred to as the process that helps the organisation in breaking their customer’s groups down into units based on their beliefs, values and reasons. The psychographic aspects that influence consumer purchase behaviour include of their lifestyle, social status and opinions (Gajanova, et al., 2019).http://UGB161 Introduction to Marketing Assessment Sample Marks and Spencer use psychographic segmentation based on the personality traits, values, interest and lifestyle of the people.
The product category of M&S is based on the personality and current trends in the fashion market. M&S design their clothing ranges based on the current lifestyle and trend that are being followed in all over the UK.
Besides, values are also been offered by M&S through their clothing such as physical comfort, aesthetic and body awareness. Keeping in mind the personality traits of different age groups of people, M&S has a different segment of clothing starting from young age children to working professionals (Marketingweek, 2020). http://UGB161 Introduction to Marketing Assessment SampleTherefore, psychographic segmentation benefits the organisation in determining their target customers and offer products that match to their experiences.
Psychographic customers help Marks & Spencer to unveil valuable insights into consumer motivations, it offers insights to the firm about the current needs and wants of the customers. Customers of psychographic segmentation help the organisation in determining about the understanding the beliefs and attitudes of the customers as a result of which it becomes easier for the firm to offer products and services that rightly matches to the needs of the customers.
It also helps the firm in increasing its product profile along with creating data-driven customer profiles. Customers of psychographic segmentation help the organisation in maintaining the purchase history and the product they search for that benefits the organisation in promoting the specific products among the customers that increase the chances of turning the customer into final buyer (Pitt, et al., 2020).http://UGB161 Introduction to Marketing Assessment Sample Therefore, psychographic segmentation plays a vital part in Marks and Spencer business operations.
Factors influencing customer buying behaviour
The factors that influence the customers buying behaviour includes discounts, offers and promotions that are being offered by Marks and Spencer to their customers. The different types of offers that Marks and Spencer to their customers help the help in attracting the customers towards the firm and influence their purchasing decisions.
Customer buying behaviour also benefits the organisation in identifying the purchasing pattern of the customers which they use later use to promote similar products through personalised messages and emails (Bellini, et al., 2017). http://UGB161 Introduction to Marketing Assessment Sample
M&S offers different types of discounts and offers including of end of season sale, discounts on grocery items, falt sales and trade-offs that help the organisation in identifying the psychological factors that affect the buying behaviour of the employees.
Determining the psychological aspects of the consumers help Marks and Spencer in understanding their perception towards the particular product and services. It also benefits in knowing about the attitude and beliefs of the customers towards the product (Joshi & Rahman, 2019). http://UGB161 Introduction to Marketing Assessment SampleBased on the feedbacks of the customers the firm makes changes and altercations in the products and services that help the UK based retail firm in offering the best quality of products that influences the buying behaviour of the customers.
Attitudes and beliefs also play a vital part in developing the buying behaviour of the consumers as a certain attitude and beliefs influence the people to behave in a particular way towards a product.
The attitude that is being shown by the customers towards a particular product help in defining the brand image of the product (Ramanathan, et al., 2017).http://UGB161 Introduction to Marketing Assessment Sample Besides, while designing the products social factors such as age, gender and income are also been taken into consideration. The above all factors help Marks and Spencer in influencing the customer buying behaviour, that grows the chances for the firm in earning high growth and revenue.
Figure 3: Factors influencing consumer behaviour
Source: (Bellini, et al., 2017)
Buyer decision-making process
Need recognition- The first stage of buyer decision-making process includes determining the needs of the customers as what specific type of product and services they are looking for (Stankevich, 2017). http://UGB161 Introduction to Marketing Assessment Sample
Marks & Spencer need to understand the behaviour of customers and access continuous feedbacks from the customers so that they can identify the needs of customers and offer them similar products that grow customers trust towards the organisation.
Information search- Customers in this stage looks out for information from a different platform such as an online and offline platform. This is the buyer’s effort to search internal and external business environments to identify and evaluate information related to a cental buying decision (Panwar, et al., 2019). http://UGB161 Introduction to Marketing Assessment SampleM&S provides information through their websites, print media and ad campaigns to inform the customers about their product offerings.
Evaluation of alternatives- During this stage, the consumers compares two identical products based on their features, specification, quality and prices. Customers attitudes heavily play the role to make their mind for purchasing the product.
Marks and Spencer on their websites have a dedicated section where the consumers can compare the products. Evaluation of alternatives helps the consumers to select the best product that matches their needs.
Purchase decision- Purchasing decision of the customers are based upon the above all factors, as if all the factors match the expectations of the customers then they make up their mind to purchase the specific product and services.
Although, the purchase decision of a consumer is also based upon two factors such as negative and positive feedback from other customers.
Post-purchase behaviour- During the post-purchasing behaviour, the customers intend to compare the products with their previous expectations (Mittal, 2017).http://UGB161 Introduction to Marketing Assessment Sample Post-purchasing behaviour of customers plays a vital part as it helps in showing their future loyalty with the respective firm.
M&S develops its product based on standard measures that fulfil all the expectations of the customers and make them loyal towards the organisation.
The buyer decision making factor for Marks & Spencer is based on their values and their focus towards understanding the attitudes and beliefs of the customers. Marks & Spencer offer value-based products to their customers that are of high quality and matches the expectations of the customers.
Example- The grocery items that are being offered by Marks & Spencer are fresh and healthy without adding any preservatives. Similarly, based on the aesthetic values and physical comfort of the people the organisation also offers different types of clothes to the people.
Besides, all the products designed by Marks and Spencer are specifically designed while understanding the customers and gaining their feedback, therefore it helps in satisfying the needs of customers while growing the business opportunities that earn them higher revenue (Campaignlive, 2020).http://UGB161 Introduction to Marketing Assessment Sample
In compared to Marks & Spencer Tesco and ASDA beliefs on offering discounts to the customers which in some circumstances turns against them as the products are either of inferior quality or do not match to their personality traits. Therefore, understanding customer buying behaviour helps M&S to enjoy competitive advantages over its competitors.
Figure 4: The consumer buying process
Source: (Stankevich, 2017)
Justification of selected marketing strategy
The chosen marketing strategy that has been undertaken by the M&S includes product marketing. The two segmentation that the firm intends to target is demographic and psychographic segment of customers. The marketing strategy of product marketing has been undertaken by the UK based retail firm as it helps in marketing the products among their customers and grow their awareness among the intended target customers (Cheng & Liu, 2017). http://UGB161 Introduction to Marketing Assessment Sample
Both the demographic and psychographic target segment for Marks and Spencer purchase the products due to their large product variety, availability, standard quality and values. The target segment for Marks & Spencer starts from young children to old people.
The company has a specific type of products for each of the target segment such as the current line of fashion wear for the young generation, cotton clothing of ranges for old people (Thedrum, 2020). http://UGB161 Introduction to Marketing Assessment SampleBesides, in their grocery segment Marks and Spencer also offers food items based on the specific age group of people.
Product marketing strategy helps M&S to promote the products among the customers through different social media platform and traditional media platform that help the organisation in sufficing all the requirements of all segments that contribute towards the growth of the business.
Product marketing in demographic segmentation benefits in understanding the age group of people that the ads are being created for, such as if the ads are being designed for young people then most of the ads are being showcased in sports channel and fashion channels. Whereas, if the ads are being designed for children then those are being shown in cartoon channels and for people over the age group of 35 years and above the ads are being promoted through news channels.
Product marketing in demographic segmentation help in determining the needs of each specific segment based on their purchase history and experiences. All the data of the customers are being stored within the database of the organisation that is being used to know about the likeness of people and offer them similar products that they can not refuse.
Understanding the needs of demographic target people also assist M&S in optimising their marketing planning and strategies accordingly that contribute towards the growth of the organisation. On the other hand product marketing also benefits M&S in fulfiling the needs of the psychographic segment as well such as it focuses towards understanding the attitudes and beliefs of customers, values they seek and understanding their personality aspect (Prentice, et al., 2019).http://UGB161 Introduction to Marketing Assessment Sample
Determining the psychographic aspect of the customers benefits the retail business in offering products based on their likeliness. Such as developing the quality of foods and clothes, offering the psychographic segment customers with better standard quality of products that matches their personality. Comprising of all these factors it can be stated that product marketing will help the organisation in fulfilling the requirements of both demographics and psychographics segments.
Product marketing strategy for Marks & Spencer also helps them in growing product demand. Because the retail firm develops the product that matches the needs and desire of the customers therefore it demands increases.
Growing product demand motivates the organisation in producing more of this product that helps the organisation in moving their business forward. Product marketing also helps the UK based retail firm Marks & Spencer in increasing product knowledge among the customers (Marksandspencer, 2020).http://UGB161 Introduction to Marketing Assessment Sample
Product knowledge for the customers helps them in understanding the particular product traits and benefits that the customer desire for. Product marketing allows for focused product development and developing more promotional messages. Furthermore, product marketing also helps the business venture in developing public relations and offer value to the targeted customers. Comprising of all the above factors it is justified that product marketing strategy helps M&S to grow and move their business forward.
Conclusion
The overall report explains the marketing audit and current business performance of Marks and Spencer. The UK based retail firm has undertaken a product marketing strategy that helps the organisation in improving product knowledge among the customers through different media platforms.
Besides, factors such as attitudes and beliefs, values, discounts and offers influences the purchasing decision among the customers. Appropriateness of product marketing upon two segments such as demographics and psychographic has been discussed that help the organisation in understanding needs and demands of the customers and offer them a similar product that contributes towards moving the business forward for M&S.
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