The Value of Setting Marketing Objectives
Marketing management: decision-makers in a business who identify, anticipate, target and satisfy customer needs profitably.
- Identify: by using marketing research, plus their experience.
- Anticipate: by understanding data and current trends, and then predicting future trends.
- Target: by planning marketing campaigns.
- Satisfy: by implementing the plans successfully to sell products.
- Profitably: by generating revenue greater than the costs involved.
The value of marketing objectives
Objectives are long-term targets for a business.
Targets allow a business to plan their resources, provide a checkpoint for progress and a focus for on-going decisions.
Marketing objectives feed into the business’s corporate objectives. For example, most businesses will want to grow and remain profitable. Therefore, the marketing objectives are likely to be about growing profitable sales.
The most likely marketing objectives are:
- Sales volume: the number of units sold. This could be for a specific product, or a range of products.
- Sales value: the revenue generated from products.
- Market size and sales growth: an increase in the size of the whole market in volume or value of sales
- Market share: the percentage of the total market. Of course, this does depend on what’s defined as the total market for a particular business. For example, it might mean for sales of a sports car a percentage of sports car market for the world, or the UK or the area or for just the two-seater?
- Brand loyalty: measured by repeat sales. Not appropriate for more one-off purchases, like bespoke machinery for large manufacturing companies.
To make calculations a business might need to estimate:
- Market size: the potential number of customers in the market.
- Competition sales: who are the closest rivals.
AQA calculations for this section
- Market size volume is the quantity of goods and services produced in a particular market over a period of time, usually one year.
- Market size value is the total sales revenue generated from selling all of the goods and services produced in a particular market over a period of time, usually one year.
- Sales volume is the quantity of goods and services produced by a particular business over a period of time, usually one year.
- Sales value is the total sales revenue of a particular business over a period of time, usually one year.
These are the calculations to be made:
- Market growth % in year ‘X’
- Sales growth % in year ‘X’
- Market share %
Bear in mind that the difference between years X-1 and X could be negative (e.g. between 2016 and 2017), thus showing a decrease.
External and Internal Influences on Marketing Objectives and Decisions
Internal influences on marketing objectives
- Budget – does the business have enough cash to invest in achieving the objective?
- Current product portfolio – does the business have a strong range of products?
- Skills/expertise – does the business have the right people? For example, skills in social media or understanding the market place in different countries.
- The brand and brand loyalty.
- All objectives must tie into the other functional objectives – that is operations management, finance and human resource management,
Brand and brand loyalty is a key factor for the success of a business.
A brand is something that a customer immediately identifies with and trusts. That means they are more inclined to buy, and not buy from another brand.
Good branding enables a business to sell more and/or charge more than their rivals.
|Marketing management||decision makers in a business who identify, anticipate and satisfy customer needs profitably|
|Marketing objectives||Long-term targets for business|
|Market size volume||Quantity of goods and services produced in a particular market over a period of time usually one year|
|Market size value||The total sales revenue generated from selling all of the goods and services produced in a particular market over a period of time usually one year|
|Sales volume||Quantity of goods and services produced by a particular business over a period of time usually one year|
|Sales value||Total sales revenue of a particular business over a period of time usually one year.|
|Brand||A product that is publically distinguishable from other products.|