Question 1. The Influence of advertising on the buying decisions
The influence of advertising on consumer perception is critical for marketers (Kotler & Keller, 2006). In fact, the objective of any marketing specialist is pushing the existing customers to buy more, and attracting new customers (Joshi, 2005). Advertising is the main major solution in this regard. There are various approaches to advertising, but the most effective two are ‘brining an emotional idea’ and ‘highlighting the flaws’ (Armstrong & Greene, 2007).
Several recent studies have revealed that emotions and psychological appeals are more effective than focus on functionality of a product (Hochbaum, 2011). For instance, the sales of I-Phones are mostly driven by the popularity of this gadget and it ‘elitist’ characteristic. In reality, a customer may never explore its full functionality, but possessing a one shows that a person that a person stays mainstream (Laermer & Simmons, 2007).
The second effective use of advertising to affect buying psychology is highlighting the flaws (Ampuero & Villa, 2006). A dogmatic is a “Lemon” example used by Volkswagen. The main goal of the advertiser in this strategy is to demonstrate that a user has some flaws, and his product (or service) is the only remedy to redress this flaw.
Question 2. Reaching global perspectives with a regional product
Trident Seafoods is a widely recognized seafood producers located in the state of Alaska. It operates several plants and facilities in the state, but the products (mostly salmon) are mostly resold to wholesalers.
The best way to start selling the products internationally is to employ the combination of wave and price dumping strategies. In other words, if the firm has enough resources it may significantly reduce prices and organize deliveries into a specific region. The local suppliers, and the international competitors have are unlikely to resist competition, and will leave the market. This strategy may not be employed in the countries, where the competitors have been long present, and the customers have developed loyalty to them (Lenskold, 2003). Vodacom (Tanzanian branch of the international mobile telecommunication company Vodafone) has used this strategy in East African countries, where the firm managed to exclude all local and international competitors.
Secondly, resorting to performance competition is effective, especially in the developed markets, where the clients are fastidious about their buying choices (Kotler & Keller, 2006). General Mills has employed this strategy to become dominant on the UK market (Joshi, 2005).
Question 1. Using social market segmentation as a marketing tool
The USA population can be classified into the five basic groups (Besanko, 2013):
Part-time and unemployed population (<USD$ 7000 annual income)
Clerical Service and Blue-collar workers (<US$ 25,000 in annual income)
Professional Support & Sales Employees (< US$ 50,000 in annual income)
Professional ($US 50,000 - $US 200,000 in annual income)
CEOs and top-professional (> $US 200,000 in annual income)
Analyzing annual disposable income, the marketers can employ several strategies. Firstly, they may advice the management to start producing luxury or simple products. In other words a product with extra comfort or design features will appeal to the higher classes, while more primitive version will target the lower classes. Secondly, they marketers should adapt their advertising strategies to each group.
Question 2. The Greatest Impact on Social Class
Today’s research shows that the financial income inflicts the greatest impact on the USA social classes (Besanko, 2013). In fact, it is its main determinant. Yet, it will have two different ramifications in the following ten years. Firstly, the buying power will increase in specific markets (e.g. technology), where the competition is becoming tougher, and the supply increases. Secondly, it will remain stable or even decrease in the markets, where supply is not likely to increase (e.g. food, jewelry and other luxury items).
References
Ampuero, O. & Vila, N. (2006) "Consumer perceptions of product packaging", Journal of Consumer Marketing, Vol. 23, 2, pp.100 – 112
Armstrong, S. & Greenem, K.C. (2007). "Competitor-oriented Objectives: The Myth of Market Share" . International Journal of Business 12 (1): 116–134.
Besanko, D. (2013). Economics of strategy. Hoboken, NJ: John Wiley & Sons.
Hochbaum, Dorit S. (2011). "Rating Customers According to Their Promptness to Adopt New Products". Operations Research 59 (5): 1171–1183.
Joshi, R. (2005). International marketing. New Delhi New York: Oxford University Press
Kotler, P. & Keller, K. (2006). Marketing management. Upper Saddle River, NJ: Pearson Prentice Hall.
Laermer, R. & Simmons, M. (2007). Punk marketing : get off your ass and join the revolution. New York, N.Y: Collins.
Lenskold, J. (2003). Marketing ROI: the path to campaign, customer, and corporate profitability. New York: McGraw-Hill.
