Marketing Principles Report

This report is a comprehensive analysis of marketing principles using H&M as a case study. It covers various aspects of the marketing process, including elements of the marketing process, marketing orientation, environmental factors (PEST analysis), segmentation criteria, target strategy, buyer behavior, and positioning strategy. The report further delves into product development for competitive advantage, distribution methods, pricing strategies (recommending a competitive pricing strategy for H&M's patchwork denim bags), integrated marketing communication, and the elements of the promotional mix. Finally, it examines the marketing mix variables for two consumer market segments, differences in marketing for consumer and business markets, and differences between domestic and international marketing, concluding with a summary of effective marketing practices for H&M's new product launch.

Marketing Principles

Table of Contents
Marketing Principles........................................................................................................................1
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Elements of Marketing Process.............................................................................................1
1.2 Marketing Orientation...........................................................................................................2
TASK 2............................................................................................................................................2
2.1 Environmental factors...........................................................................................................2
2.2 Segmentation criteria............................................................................................................3
2.3 Target strategy.......................................................................................................................3
2.4 Buyer Behavior.....................................................................................................................4
2.5 Positioning Strategy..............................................................................................................4
TASK 3............................................................................................................................................5
3.1 Product development to sustain competitive advantage ......................................................5
3.2 Distribution methods.............................................................................................................5
3.3 Pricing methods used by businesses and recommend pricing strategy that H&M can use
for patch work denim bags..........................................................................................................6
3.4 Integrated marketing communication ..................................................................................6
3.5 Elements of promotional mix................................................................................................6
TASK 4............................................................................................................................................7
4.1 Marketing mix variables for two segments of the consumer market....................................7
4.2 Difference in marketing for consumer and business markets...............................................8
4.3 Differences between domestic marketing and international marketing................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Marketing is a way of communication between company and consumers with a goal of
selling the products and services to the maximum users. This involves various activities and
processes which are concerned to find out the demand and requirements of the customers and
then also fulfilling it for them (French, Dip and Blair-Stevens, 2006). Marketing principle is a
method to optimize the performance of existing & new products of company in market. To
understand the marketing principles, Hennes and Mauritz is considered which is Swedish retailer
and sells fashionable clothes in affordable prices.
This report describes concepts and process of marketing and includes concepts of
segmentation, targeting and positioning. Further it involves tools to evaluate the micro and
macro environment of H&M (Armstrong, 2008).
TASK 1
1.1 Elements of Marketing Process
Marketing-
'Marketing is set of activities and actions of promoting and selling the products and services in
market'.
'Marketing process is based on thinking about the business in relation to customers needs and
requirements'.
Marketing process is a set of activities which includes situation analysis, strategies formulation
and marketing mix elements of company (Wang and Pizam, 2011). The elements of marketing
process of H&M are described below:
 Environment analysis- With the help of strategic tools the analysis of market and
company's environment are evaluated. To understand the market and customer's demand
H&M can implement few tools.
 Target identification- H&M identifies its target market and also targets specific segment
of consumers (Kotler, Bowen and Makens, 2006). To identify the target, customers
buying behavior and their needs differences are considered.
 Objective- The marketing objectives of H&M are considered which includes short &
long term objectives to maximize profits and brand image.
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 Marketing Mix- To evaluate the characteristics of target customers, elements of
marketing mix are considered (Tharakan, 2015).
1.2 Marketing Orientation
Marketing orientation mainly based on four concepts:
 Production- This concept assumed that company should do mass production of product
because product should be available for all customers (Adeleye, 2005).
 Product- This concept focus on the quality of the products and it assumes that quali8kty
of product will increase the sales.
 Sales- The product is not considered in this concept but selling of product to customers is
considered.
 Market- This concept evaluate the target market and identifies their needs.
The market orientation suits the H&M because they are mainly customer centric. This concept
helps cited company to identify the target market and undiscovered needs of customers. Cited
firm always put customers o the their first priority because they are the end user of their product
(Dibb, 2012).
TASK 2
2.1 Environmental factors
To develop and expand the business, both micro and macro environment are evaluated from
PEST and SWOT analysis which are discussed below:
To analyze the macro environment, PEST analysis is implemented:
 Political- In this, inflation is a main factor which leads to decrease the level of company's
sales revenue.
 Economic- Government policies like fiscal and monetary puts major impact on rates of
tax, inflation and interest which increases and decreases the company's cost (Brassington
and Pettitt, 2006).
 Social- The lifestyle, class, religion and income of customers are major factors which
influence company to provide better service and product.
 Technological- Adoption of new updated technology gives impact on profitability and
revenue of company.
To analyze the micro environment few factors are involved:
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 Suppliers- H&M has approximately 800 suppliers which supplies raw materials to
company (Nagasawa, 2009).
 Buyers- H&M targets huge number of target group because they provide quality products
in low prices.
 Employees- Cited company have 95 strong group of designers who takes design
inspiration from real life.
2.2 Segmentation criteria
Segmentation is a procedure to target the consumers with specific characteristics in a
small group or segment and once the segments are identified then H&M develops the products
according to their demands and needs.
H&M is mainly specialized in clothing for both men and women and for these they have
many loyal customers. Now company can launch trendy bags like according to the customer's
requirements to boost the sales of company (Tapp, 2008). For this purpose company can consider
females, age of 15-45 years. To gain the attention of female customers company can launch
patch work style denim bags. The patch work designs will be taken from cultures of various
nations because designers like to travel at different places to take the design inspiration. It will
further make use of flamboyant colors and are meant for females. These bags would be available
in a variety of shape and sizes. With the help of this segmentation criteria, H&M can be able to
attract more customers towards them (Donovan and Henley, 2010).
2.3 Target strategy
The target strategies involves customer segmentation to whom H&M will wishes to sell
the product and services and also to select consumer segment which are appropriate for
company's product (Gilbert, 2008). To increase the sales of product it is important to target the
customers. For this company is focused on the females whose age lies in between the age of 15-
45 years and in bags company will focus on bag size and color because girls who are in age of
15-24, they mostly like the more fashionable and trendy bags of different colors with different
sizes. Further, females who are age of 26-45, they prefer stylish, elegant and designers bags.
With this targeting strategies, company can gain more awareness of customers and also able to
attract more customers (Ferrell and Gonzalez, 2004).
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2.4 Buyer Behavior
Buying behavior defines that why consumers are buying and for what purpose they are
using the products. The market strategies directly affects by the behavior of buyers and it also
gives impact on the consumers buying situation (Armstrong, 2008).
H&M have to consider the demand ans support of their targeted customers. In above
context, the patch work denim bags will attract and influence more female customers towards it.
For the convenience of customers, company provides its products on their both physical and
online outlets. The four types of factors influence the buyer's behavior which are discussed
below:
 Cultural- This factor includes culture, sub-culture, religion, nationality and class of
customers.
 Social- It includes family, roles and status of the customer. This factor describes that the
outsiders influence the customers to purchase the product.
 Personal- This contains lifestyles, age, occupation and personality factors of customers
which gives impact on the buying decision of buyer (Baron, Harris and Hilton, 2009).
 Psychological- The motivation, attitudes and beliefs are included in buying decisions of
customers.
2.5 Positioning Strategy
The main objective of positioning process is to occupy the unique, advantageous and
clear position in consumer's mind by using the factors like product, price, place and promotion.
It is highly required to position the bags in effective manner to gain and attract more customers.
In this context, the bags for females with the different sizes and flamboyant colors are positioned
as a new fashion trends in market (Kottler and Keller, 2006). In advertisement of this product,
the mediums can be used like TV, fashion magazines and social websites. In further the brand
endorsement can be done by signing Angelina Jolie as a brand ambassador because she is
famous celebrity and her fashion styles influence more females. For marketing posters and
banners can be used in fashion events. Company can also focus on the infrastructure and staff of
the stores because it will give positive impact on the females perception (Lefebvre., 2004).
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TASK 3
3.1 Product development to sustain competitive advantage
In retail industry, H&M face huge competitors like Benetton, Gap, Zara and Uniqlo
fashion market, so, it is essential to develop a new product with good quality to sustain the
competitive advantage and also lead the market place. For this purpose, it is essential for the
H&M to produce fashionable and trendy bags for females (Klink and Athaide, 2004). For youth
the denim bags will be designed in different sizes and vibrant colors and for females who are in
age of 26-45 years, the designer looking bags will be designed by keeping simplicity and elegant
look in mind (Wright, 2014). The patch work design will be made on the denim bags which will
be taken from different cultures of various nations by the designers of company. The team
includes designer from Sweden, Netherlands, Britain, South Africa and USA. Company can
charge competitive prices for patch work denim bags. With the help of competitive prices more
customers will attract and purchase the product of cited firm because customers will assume that
they are getting quality product in their affordable prices (Pillay and Kutty, 2005). If company
charges high prices than customers may be switch to other brands. Hence, the above mentioned
techniques gives the competitive advantages and all this features of denim bags will also makes
the cited firm different from others in market.
3.2 Distribution methods
It is essential for H&M to make the product available to all customers because the
customers are end or last users of products and services of company. The distribution strategy is
a procedure which describes that how the company will transfer its products to retailer and
customers (Donovan and Henley, 2010). The distribution of products can be done by using three
strategies like intensive, selective and exclusive.
With the help of intensive distribution strategy, H&M can provide its new product which
is patch work denim bags for all females customers from its both physical stores and online
outlets. For the customer's convenience the physical stores are located throughout the US and
cited firm can also distributes its product on the retail showrooms, this will also boost the sales of
company (Blythe, 2006). Cited company can also provide the products on their websites. This
intensive distribution strategy will surely helps H&M to provide its products to all customers. In
case of online selling, the delivery will be made within two days when the order has been placed.
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3.3 Pricing methods used by businesses and recommend pricing strategy that H&M can use for
patch work denim bags
There is a presence of many pricing methods that are available to any business. These include
fair, competitive, premium and penetration pricing. In this regard, the cited company can make
use of competitive pricing where H&M team can give consideration to the prices as set by
competitors (Klink and Athaide, 2004). Here, the company will have a chance to set high, low or
even equal prices to that of competitors. The recommended technique can be justified as H&M is
likely to face a lot of competitors in this bag segment. These pricing strategy will help the cited
firm to increase the customers and sales (Kotler, Bowen and Makens, 2006).
3.4 Integrated marketing communication
Integrated Marketing Communication (IMC) can be defined as applying the consistent brand
messaging in traditional as well as non-traditional channel of marketing. It further makes use of
varied kind of promotional methods.
The promotion of product is a important process to introduce the brand name in front of
public and this process also attracts the new customers towards the company's product (Kotler
and Armstrong, 2007). With the successful and attractive advertisement, customers knows the
product in positive way. The promotion of new products as a denim bag can be done by fliers
and leaflets. The advertisement of denim bags can be displayed by using hoardings and banners
at various fashion events.
3.5 Elements of promotional mix
In this regard, the elements of promotional mix as well as extended mix for patch work denim
bags in H&M are discussed as follows;
Product The product offered is patch work denim bags. They will make use of best
quality denims. The patch work designs will be taken from cultures of
various nations (Ferrell and Gonzalez, 2004). It will further make use of
flamboyant colors and are meant for females and would be available in a
variety of shape and sizes.
Price Penetration pricing will be followed at first so as to attract the females
towards the bags. Then the prices will be made competitive so as to garner
the profit.
Place The distribution channels will include intensive distribution strategy
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(Sethughes, 2013).
Promotion Promotion of the bags will be done by fliers and leaflets. The advertisement
of bags will be displayed on hoardings, banners and also in newspaper and
magazines.
People The employees will include marketers and sales person so as to promote and
sell the product. M&S can hire well groomed, developed and trained staff
people (Charlie, 2015).
Physical
evidence
There will be a presence of both online and off line sites. Hence, off lines
sites will include proper display of bags, seating arrangement for shoppers as
well as good lightening. Good sales person will be appointed so as to
convince the females for buying the bags (Priluck, 2004).
Processes This will include making the billing processes faster and reducing the
waiting time of females. In case of online selling, the delivery will be made
within two days when the order has been placed.
TASK 4
4.1 Marketing mix variables for two segments of the consumer market
Marketing mix
variables
Geographic Psychographic
Product Product features to be offered
by H&M will depend on
weather conditions,
Product to be offered will
be as per taste and
preferences of consumers.
Price Fixed pricing will be used
(Priluck, 2004)
Competitive pricing will be
used so as to attract
consumers from
competitors
Place Distribution channel will
depend on geographical
Distribution channel will be
to favor consumer needs.
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landscape Hence shops of H&M will
be located as per ease of
consumers
Promotion Promotion will be done by
electronic and mass media.
(Wright, 2014)
Promotion will make use of
traditional and modern
means.
4.2 Difference in marketing for consumer and business markets
There will be a huge difference when H&M will carry out marketing activities for consumer and
business markets which is described below:
Marketing activities for consumer
markets.
Marketing activities for business markets.
Marketer require using simple language Marketer require use of technical jargons.
Marketers here need to focus on emotions. B2B Marketer need to be rationally and
logically driven.
B2C clients just need there requirement to
get fulfilled.(Sethughes, 2013)
B2B clientele wants expertise information
from marketers.
4.3 Differences between domestic marketing and international marketing
H&M has a plan to introduce patch work denim bags in India as well as UK. In this regard, the
marketers are required to be thorough about the differences that exist between domestic and
international marketing. These are as follows;
Domestic marketing International marketing
Marketers face less issue in terms of cultural
understanding as they are already aware of the
same (Charlie, 2015).
India is a land of diverse culture. Hence
H&M can face issues in marketing.
There will be low level of marketing expertise
in UK due to market know how (Baron, Harris
and Hilton, 2009)
Marketers of H&M will have to face
dynamic and complex competition in India;
hence they will have to plan their strategies
accordingly.
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Marketers of H&M can make use of existing
media forms so as to target consumers of UK
for patch work denim bags.
Marketers of H&M would be required to
gain awareness about kind of media
available in India so as to target consumers.
important to be aware of the types of media
available and the kind of media your target.
(Tharakan, 2015) market.
CONCLUSION
With the help of this report, it can be concluded that marketing principle plays a
important role in business. Company have to entail the different strategies for marketing process
to gain the best response from the target market and customers. H&M being a very new in the
denim bags with the patch work on them, can attain high amount of customers attention and also
increase the sales base by implementing the effective and efficient marketing practices.
Company can also follow suggested strategies for their market segmentation, targeting and
positioning of their new product so that they can generate high response from the market and
customers. With the help of marketing mix elements cited company can attract more customers
towards the new product of company.
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