The conceptual difficulties experienced by students taking Marketing at A Level.
The essay will discuss: (1) the importance of integrated thinking and how marketing strategy is vital for the motivation of students; (2) how the subject can be made relevant with the use of case-study material. The use of study skills, in relation to marketing, will be considered; (3) the correct focus of answers; (4) an awareness of the correct marketing terms; (5) at higher levels, an offer of realistic and evaluative answers. Reference is made to various past exam questions.
Firstly, learners need to consider a strategic response (AQA June 2006 Report). Learners need to think about marketing in an integrated (strategic) manner. This is because there has been a tendency to simply describe marketing tactics in isolation (AQA 2004). The components of the marketing mix (price, promotion, place and product) should be considered together. Learners need to think about how each element of the mix impinges on other parts. For example, a premium product implies a premium price.
Another similar conceptual difficulty is that marketing has been understood in isolation, separate from the rest of the organisation. It should be acknowledged that the financial function might constrain the marketing function if there is insufficient money for investment in marketing activities. Piercey (1995) states that marketing budgeting is critical important; it is about ‘how we get the resources we need to get our marketing act together’.
To give purpose to the work and to motivate learners, it is necessary to explain to them that marketing can have a strategic function. According to Piercey (1995) marketing strategy is fundamental to the business because it addresses ‘the overall direction of a business in its various marketplaces’. Therefore, to help motivate learners, it could be useful to examine mission statements and how corporate and marketing strategies can be developed.
Secondly, the subject needs to be made relevant to learners. This is because marketing has been understood in a theoretical manner. Marketing concepts such as elasticity, SWOT and the Boston Matrix need to be understood as practically-relevant decision-making tools. The emphasis should be on implementation and how concepts can be applied to authentic business scenarios.
Budget airlines such as Easy Jet have used elasticity to calculate how far sales would rise if they reduced prices. This would be useful to Easy Jet as the airline would hope to predict how many sales it could capture from a more established airline such as British Airways.
In addition, a SWOT analysis should be used to make decisions. Learners should be encouraged to think about how weaknesses in an organisation could be turned into strengths and threats transformed into opportunities. A real-life example could be useful. Internally, a retailer may need to address a weakness such as its understanding of technology and the internet. Externally, a traditional shop may need to address the threat from online retailers who offer an alternative to customary stores. Indeed, some retailers have developed their own internet home-shopping operations in response to the availability of the technology and the potential threat from new online entrants into the market. It is these companies who are now the leading online retailers in the United Kingdom.
An exam question was asked about Product Portfolio Analysis, which could include the Boston Matrix. Insufficient detail was provided according to the report (AQA 2005). Therefore, specific examples using case studies would be useful. In terms of the Boston Matrix, money from the ‘cash cows’ (products with a high market share in a low growth market) could go into developing the ‘problem children’ (products with low market share in high growth markets) (Hall et al. 2006). A real-life example would be useful. A music retailer such as EMI will want to consider how it can re-invest its profits within the business; profits from its Beatles back catalogue could be re-invested in the promotion of new music artists.
Thirdly, there is the need ensure that the answer to a question is properly focussed. Answers to an exam question which asked about the product life cycle strayed into a discussion of product portfolio analysis (OCR 2006). Learners need to know the difference between the two concepts; they also need to address the question of exam technique and know that they are required give a focussed answer.
Fourthly, students confuse marketing terms. There was confusion between the terms ‘R&D’ – research and development – and ‘market research’. (AQA 2003). Confusion between the term ‘market share’ and ‘market growth’ is another example cited by the AQA exam board. To avoid confusion, learners could be given a glossary. A thorough understanding is needed to avoid problems over definitions. For example, it appears that qualitative research was defined as primary market research (AQA 2003).
Fifthly, another conceptual difficulty is that applications of marketing may not be realistic. A student could overestimate the ability of a small organisation to undertake marketing activities. The AQA exam board has suggested that marketing ideas should be realistic and justified in the context of the business. The marketing plans of a sole trader or partnership will be constrained by the size (the context) of the organisation. A marketing campaign, in the context of small organisations or businesses, is likely to be limited to providing information. In contrast, a private limited company will be more likely to invest in a sophisticated marketing campaign because it can afford to do so. The context needs to be considered. Completely justifiable would be the suggestion that sophisticated, non-price-based marketing, such as loyalty schemes, would be appropriate in an oligopolistic situation such as United Kingdom grocery retailing.
To deal with this problem, learners need real examples, or case studies, as outlined above. They also need a good basic knowledge of economics. Learners need to be aware that advertising, such as the loyalty schemes mentioned above, is likely to be more significant in some market structures (oligopoly and monopoly) than others (monopolistic and perfect competition). Oligopolistic companies have the revenue to afford the cost of advertising. They also have the motivation to protect their current market structure and so will want to use advertising to act as a ‘barrier to entry’.
Learners may over-estimate the potential of market research to solve marketing problems and should be aware that market research has limitations. They need to be able to show skills of evaluation; for example, they need to be able to evaluate market research, consider problems and reach conclusions from such research.
Coca Cola launched a new ‘coke’ onto the market, based on a new taste and formula. Market research suggested that this new formula would be successful. However, this type of survey of opinion was hypothetical as it did not explore the adverse consequences of trying to replace the original coke with the ‘new coke’ formula. Learners therefore need to question the value of data from such opinion polls. They should consider how more useful questions could be formulated. For example, a question could aim to elicit how the sales of the current coke could be affected by the introduction of a ‘new coke’.
Hall D, Jones R., Raffo C., 2006, Business Studies, Third Edition, Causeway Press
Piercey N., 1992, Market Led Strategic Change, Making marketing happen in your organisation, Butterworth-Heinemann