Marketing Environment Analysis for Otago Polytechnic
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This paper analyzes the marketing environment for Otago Polytechnic, including micro-environmental and macro-environmental factors. It also includes a SWOT analysis and recommendations for the organization.
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1.0Part One: Marketing Environment 1.1 Introduction Analysis of the marketing environment for a business is one of the most success- critical tasks for the managers as the process of such analysis takes into consideration a number of factors that are both internal and external to the business (Johnstone & Tan, 2015). The instant paper deals with such analysis in the context of an academic institution, Otago Polytechnic (hereinafter may be referred to as the business or the organisation or the institution, as the case may be) based in New Zealand. 1.2 Analysis of Micro-Environmental Factors The organisation’s two internal factors that may affect the operational performance of the institutions are as mentioned herein: Management:The organisation’s management and its efficiency may affect the operations of the business through optimising the operations including the cost structure and implementing long-term sustainable strategy for operational excellence. It is identified that the institution is a public entity governed by the Council comprising of eight members spread among four committees ("Governance and management - Otago Polytechnic", 2019). Infrastructure:The high-end infrastructure equipped with modern technologies and facilities may help the management to build a strong brand image in the market("Physical Activity & Wellbeing - Otago Polytechnic", 2019). On the other hand, two micro-environmental factors may involve the determinants that are related to the operations but from outside from the organisation. Students:The primary customer of the business is students from whom the
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revenue gets generated. Therefore, the courses and amenity provisions have been accordingly made to suit the needs of the student. Such initiatives may include devising different courses for the students on hotel management, operation and production management and even applied management etc. Government : Externally, Government may influence the operation through tax legislation, rules and regulatory measures. 1.3 Analysis of Macro-Environmental Factors The external environment o the business may best be assessed with the help of PESTLE framework, as discussed below: Political:The present political condition is stable and the government is changed at election basis occurring in every 3 years. Therefore, it is construed to be sustainable. In other words, the business will not be negatively affected by the political elements. Economical:The country has an advanced market economy and most of the schools are Government funded. However, private schools rely mostly on the tuition fees received from students or parents (Bernini & Cracolici, 2015). Social:The country is considered to be one of the most progressive countries in terms of human development and education across the world, as per the UN’s report of Human Development Index (HDI) in the year 2008("HDI by UN", 2019). As a result, the education business may have ample scope for flourishing. Technological:Since the economy is strong, the education system is strongly equipped and supported by advanced and modern-day technology. In addition, the access to the latest technology through IT has been made possible within the campus and course programs as well.
Legal:Opening an educational institute is very easy in the country as there is a three-tier education system post which the students may pursue higher studies based on their individual carer decisions and choice. Moreover, the legal binding is lenient("How to Start a Business | Invest in New Zealand | NZ Now", 2019). Therefore, the educational set-up does not need stringent regulatory stipulations to abide by. Environmental:Polytechnic college may not be subjected to stricter environmental law; however, the management may need to control the facility to ensure that the same will not cause any harm to the society in terms of wastes disposal and air and water pollution. If the environmental aspect has not been looked into with the importance, the same may cause environmental pollution which, in turn, may adversity affect the surrounding and thereby the brand name of the institute in the long-run. 1.4 SWOT Analysis of the Organisation Strength Strong brand name Well educated country and therefore the scope for further expansion of the institute by opening branch etc. Strong employee and staff satisfaction index Weakness Considerable carbon emission The decreasing surplus for the institution and risky financial position("2017 Annual Report", 2019) Opportunity Scope for diversification in other unexplored educational sectors like technical education, adult education, crèche facility and child education etc. Threat Financial pressure on the capital structure("2017 Annual Report", 2019) High dependence on the debt burden as reflected in the annual
Growth in cash flow from operations report of the organisation ("2017 Annual Report", 2019) 1.5 Ethical and Social Responsibility of the Organisation The educational set up must abide by its ethical framework in terms of fee-charging, transparency in the operation and training and shareholder communication through corporate reporting on a timely manner (Pudaruth & Nursing, 2017). Besides, the environmental responsibility will include the consideration for GHG emission, carbon usage, air and water pollution control measures etc. It is needless to mention that these initiatives will considerably add value to the brand image of the organisation, which in turn will help the institute to create a market of loyal and long-lasting customers. OPIAC executes such responsibility by preparation of annual report on a timely manner and ensuring the corporate reporting with detailed information in order to manage the stakeholders’ expectation. Also, the sustainability reporting framework of the organisation helps the stakeholders and society at large to assess the environmental policies of the institution in countering the GHG emission and carbon usage. The sustainability reporting framework has been well-explained within the annual report of the organisation which clearly shows not only the ethical but also the social responsibility of the business towards the community at large. 1.6 Recommendation The management may need to consider opening a few technical courses not included in the current curriculum in order to promote entrepreneurship. Sustainability may be achieved if an educational house can create entrepreneurs. Besides, the debt should be paid off gradually in order to nullify the negative impact of interest cost on the bottom line. Moreover, the cash flow should be retained and used in future for the purpose of expansion and marketing budget (Ganiyu, 2017). 1.7 Conclusion Based on the discussion performed herein, it may be concluded that the well-designed marketing strategy may significantly help an organisation to attain its pre-determined
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corporate objectives of sustainability in the long-run in most time and cost-efficient manner.
2.0 Part Two: Buyer Behaviour 2.1 Impact of Reference Group on Buying Decisions Reference groups generally impact buyer’s decision and hence may be considered by the businesses houses with utmost priority. In the case of the education system, parents may act as a reference group who may influence the buying sections; of the ultimate consumers that are the students. It is needless to mention that in this example, the product/service is education. Such a group is callednormativereference group. On the other hand, celebrities or heroes may endorse a brand, for example, consumer goods like soap, where they influence the end user’s choices and preferences which is termed asa comparativereference group (Pudaruth & Nursing, 2017). 2.2 Family Life Cycle and Marketing Strategy Marketers adopt various marketing strategy to reach out to customers. One such approach is family life cycle marketing whereby the corporate houses design their offering based on the different age groups with different stages in the (Miller & Prentice, 2016). For example, a young person may want primary education whereas an adult may need a different kind of technical education or certification courses to enhance own skills. In addition, it may also be noted that a person in full time service may opt for part-time crash courses on a professional program when a graduate student may invest own time fully to undergo the given professional course program. 2.3 Impact of Social Class on Buying Decisions One of the most profound impacts of social class on the market is disposable income. People from different social class may have a different level of disposable income. Based on the level of disposable income, the offering may be devised in order to provide the premium service or value for money service. As far as educational organisation is concerned, the course structure should be devised in such a manner that the course is affordable by the people from different income group (Pudaruth & Nursing, 2017). For example, the part-time certification course may be offered at a
higher price as the target customers are earning. On the other hand, the undergraduate courses may be priced moderately as the students may not have sufficient disposable income in their hands. 2.4 Impact of Self-Concept on Fashionwear Buying Decisions Fashion wear is a luxury product where the law of demand does not apply strictly and hence even if the price of the products goes up, the demand may not go down. In brief, the demand function for these products is primarily psychological and hence, the self-concept plays an important role in buying behaviour towards these products (Johnstone & Tan, 2015). A person with the inclination towards the fashionable jewellery, for example, will not bother to spend extra amount to get premium products along with premium services. This is because the person has the pre-decided notion that the given fashion product will have certain amount of luxury value embedded within it. However, the business should consider the same while framing its marketing strategy so that the offering and target group may sync with each other. 2.5 Buyers' Decision-Making Process The decision-making process is one of the most critical aspects of the study of consumer behaviour. The process may be viewed from various dimensions such as sociology, economics and marketing discipline as well. The section below briefly enumerates the different steps involved in the buyer’s decision-making process. StagesActivities Need recognition In the first instance, the buyer generates a need to buy something for own self (Carter & Yeo, 2016). The need may be created either internally (for example hunger), or externally (for example, word of mouth, in case of cinema, or a mobile phone etc.). Personal Example:Personally, I have heard about OPAIC from my friend and also from reference groups for pursuing higher education. InformationOnce the need is generated, the buyer may want to establish the need
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searchby way of evaluating the same by way of corroborating the need alongwith the relevant information on the product or services. Personal Example:I conducted study on the OPAIC from their website and also from my friends and ex-students from my locality. Evaluation of alternatives The third stage is of comparison and resultant revaluation of different alternative bung options. In this stage, the brand value, customer satisfaction record, past samples and advertisement matter to influence the buyer’s decision to finalise the alternatives. Personal Example:I had other alternative institutes which I researched about also. However, I felt that OPAIC would be best option among these two. Purchase decision In this stage, the buyer actually buys the products or services. However, it is to be noted that there is a risk factor in this state if there is a sudden occurrence of externalities like job loss, recession, ill- health etc (Johnstone & Tan, 2015). Personal Example:I enrolled myself in the chosen course under OPAIC and that might be construed to be the actual buying decision in the given case. Post-purchase behaviour In this stage, the customer will either be satisfied or dissatisfied and the post-purchase behaviour will depend on the fact accordingly (Miller & Prentice, 2016). Personal Example:I have personally been very satisfied with the course programs and overall environment of the institute after getting enrolled therein.
2.6 Determinants of Consumer Behaviours Many factors affect the buying decision of a consumer. These determinants may be categorised in three segments namely a) economical, b) psychological and c) sociological. The section below shows the determinants in these three segments separately. Economic Determinants Personal income:if the disposable income is high, the person will be more proactive and ready to buy instantly. Income expectation:if there is a chance that in future the personal income level of the individual will go up (either by way of promotion, or increment or good growth in personal business), the buyer will be more prone to expand now, instead of in future. Liquid asset position:if the liquidity position of the buyer stands strong, the person will not bother much about the current spending by way of purchasing goods and services (Hayakawa &Venieris, 2016). Personal Example:Though my personal income was not sufficient to enter into the course, I thought of taking loan from my parents and friends. Also, there were fair amount of probability that after successful completion of the course, I will be able to get a decent job. Hence, I took the decision of joining the institute. Psychological Determinates Motivation:the moral and motive towards a good or services may be conscious, subconscious, rational or emotional. But such impetus may dictate consumer behaviour to a great extent. Perception:The same way a peso gets motivated towards buying a product or services, perception may also take its own shape either through rationality or through emotional activities. However, it is to be noted that the colour, size,
brand image, product positioning and targeting may be significant influencers in creating customer’s perception towards the same. Attitude and personality:often male customers buy German car as it seems to be masculine. The personification of the product is a part of typical consumer behaviour which may be leveraged by the corporate brands accordingly (Ganiyu, 2017). Personal Example:Since I was always interested in studying in OPAIC, being one of the most prominent educational institutes in the region and therefore, the scope of joining the premium institute aggravated my motivation level to a certain extent. Sociological Determinates As stated previously, the sociological determinants are reference groupslike families, social class, culture, opinion leaders etc. They exert significant influence on the individual’s buying habit and therefore convert the person from prospective buyer to regular buyer. Personal Example:There was peer pressure, consistent motivation and morale support by my parents and support groups (friends, family members etc.) to join OPAIC. All these factors aggravated my demand of higher study in OPAIC.
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References 2017 Annual Report. (2019). Retrieved from https://www.op.ac.nz/assets/marketing/PDF-books/2343fb42f6/J03179-OP- Annual-Report-2017-FA2-WEB.pdf Bernini, C., &Cracolici, M. F. (2015). Demographic change, tourism expenditure and life cycle behaviour.Tourism Management,47, 191-205. Carter, S., & Yeo, A. C. M. (2016). Mobile apps usage by Malaysian business undergraduates and postgraduates: implications for consumer behaviour theory and marketing practice.Internet Research,26(3), 733-757. Ganiyu, R. A. (2017). Customer satisfaction and loyalty: A study of interrelationships and effects in Nigerian domestic airline industry.Oradea journal of business and economics,2(1), 7-20. Governance and management - Otago Polytechnic. (2019). Retrieved from https://www.op.ac.nz/about-us/governance-and-management/ Hayakawa, H., &Venieris, Y. (2016). Consumer interdependence via reference groups. InBehavioral Interactions, Markets, and Economic Dynamics(pp. 81- 99). Springer, Tokyo. HDI by UN. (2019). Retrieved from https://web.archive.org/web/20081219191319/http://hdr.undp.org/en/media/ HDI_2008_EN_Tables.pdf How to Start a Business | Invest in New Zealand | NZ Now. (2019). Retrieved from https://www.newzealandnow.govt.nz/investing-in-nz/investment-options/ starting-a-business
Johnstone, M. L., & Tan, L. P. (2015). Exploring the gap between consumers’ green rhetoric and purchasing behaviour.Journal of Business Ethics,132(2), 311- 328. Miller, D. T., & Prentice, D. A. (2016). Changing norms to change behaviour.Annual review of psychology,67, 339-361. Physical Activity & Wellbeing - Otago Polytechnic. (2019). Retrieved from https://www.op.ac.nz/study/physical-activity-and-wellbeing Pudaruth, S., & Nursing, R. K. (2017). EXPLORING THE DETERMINING FACTORS INFLUENCING ONLINE PURCHASE BEHAVIOUR AMONG CONSUMERS IN EMERGING ECONOMIES: A CASE OF MAURITIUS.International Journal of Arts & Sciences,10(1), 1-22.