MARK2010 Market Analysis

Study Period 2 & 3 Exams, 2014

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Marketing
EXAMINATION
MARK2010 Market Analysis
This paper is for City West, External Central Exam Venue (External) and External Exam Venue
(External) students.

Examination Duration:

150 minutes

Reading Time:

10 minutes

For Examiner Use Only

Question

Mark

Exam Conditions:
This exam does allow ENTEXT (extra time and bilingual dictionary)
This exam is Closed Book

Materials Permitted In The Exam Venue:

(No electronic aids are permitted e.g. laptops, phones)
Non Programmable Calculator is permitted
No notes are permitted

Materials To Be Supplied To Students:

1 x Number of 16pg answer booklets per student
Instructions To Students:
Use the answer booklet provided and attachment B.
Complete the list of attempted questions on the front of the answer booklet.
All written material must be handed up.
The necessary formulae are included in attachment A.
Write your details clearly on all written material used.
You are advised to show all of your workings.
There are 8 questions. Each question is worth a total of ten (10) marks.
The exam is out of 80.

Page 1 of 8

Total ________

MARK2010 Market Analysis

Question 1
a) List two key applications of Conditional Trend Analysis in market analysis.

[Marks 2]
b) What does it mean by the random nature in period by period purchasing?
[Marks 2]
c) The NBD model predicted number of shoppers and sales of a hair care brand in
period 1 are shown in Table 1. Calculate predicted period 2 sales of:
-non-buyers in period 1 (those who bought 0 unit in period 1)
-light buyers in period 1 (those who bought 1 unit in period 1)
-medium buyers in period 1 (those who bought 2-3 units in period 1)
-heavy buyers in period 1 (those who bought 4 or more units in period 1)
[Marks 3]
Table 1: NBD prediction of shoppers and sales in period 1
Number of Observed period Observed
Predicted period Predicted period
purchases x 1 shoppers
period 1 sales 1 shoppers B(x) 1 sales
0
15869
0
15935
0
1
853
853
730
730
2
176
352
206
412
3
49
147
74
222
4
23
92
30
120
5+
174
23
134
28
Total
16998
1618
16998
1618
d) The hair care brand manager has recently developed more distribution channels and
there is an increase in sales from 1618 in period 1 to 2826 units in period 2 as in table 2.
Calculate the deviations between Observed period 2 sales in Table 2 and Predicted
period 2 sales from your answer to question c. Which shopper class is affected most by
the development of distribution channels?
[Marks 3]
Table 2: Observed period 2 sales
Shopper class
Non buyers
Light buyers (bought 1 unit)
Medium buyers (bought 2-3 units)
Heavy buyers (bought 4+units)
Total

Page 2 of 8

Observed period
2 sales
1690
506
420
210
2826

MARK2010 Market Analysis

Question 2
a) List two limitations of the Linear Response Function.

[Marks 2]
b) Tables 3 and 4 show the current advertising and sales and parameters of the ADBUDG
function
Table 3: Current Advertising and Sales
Advertising ($)
50,000

Sales (Units)
136,876

Table 4: ADBUDG Parameter Estimates

a
b
c
d

200,000
47,000
1.3
902,000

- Discuss the interpretation of the parameters a, b and c.

[3 marks]

- Use the ADBUDG function to calculate the sales when advertising is increased by 40%.
[5 marks]
Question 3
a) For the data in Table 5 calculate the following brand performance metrics:
market share;
purchase rate;
penetration;
purchase frequency;
share of category requirements;
100% loyals.
Table 5 Shoppers Purchases - Raw Data
Shopper

Brand A

Brand B

Brand C

Brand D

01
02
03
04
05
06

7
2
0
1
2
0

0
3
0
0
4
1

0
1
2
0
2
0

0
4
3
3
4
5

Attachment B is provided for assistance for this question.

Page 3 of 8

[Marks 6]

MARK2010 Market Analysis

b) From the results in part (a),

- What patterns of buying behaviour can you see in this market?
[Marks 2]
- What are the managerial implications that can be drawn from these patterns?
[Marks 2]
Question 4
a) List two key applications of conjoint analysis in market analysis
b) Consider the following conjoint design for a wine.

[Marks 2]

There are three attributes with two levels for each:

Attribute:
Attribute Levels:

Price
$10.99
$14.99

Attribute:
Attribute Levels:

Region of Origin
Adelaide Hills (AH)
Barossa Valley (BV)

Attribute:
Attribute Levels:

Grape Variety
Chardonnay (CH)
Sauvignon Blanc (SB)

When price changes from $10.99 to $14.99 utility decreases by 2.5

When region of origin changes from Adelaide Hills to Barossa Valley utility increases by
1.8
When grape variety changes from Chardonnay to Sauvignon Blanc utility increases by 1.2
- Calculate the dollar value of ensuring that the wine comes from Adelaide Hills

[Marks 2]

- Calculate the market shares if Sauvignon Blanc wines from Adelaide Hills were not
available on the market
[Marks 6]

Page 4 of 8

MARK2010 Market Analysis

Question 5
a) Table 6 contains the results of Best-Worst counts conducted on a sample of 100
respondents, about the attributes that drive the choice of consumers towards fruit drink.
The B-W experiment was designed according to a balanced incomplete block design (12,
3, 2). Calculate the Best-Worst score for these attributes. Present your results using the
principles of data reduction.
Table 6: Count Best and Count Worst

[Marks 6]
b) What are the four methods typically used for measuring consumer preferences other
than the Best-Worst method or Conjoint Analysis?
[Marks 2]
c) List four advantages of the Best-Worst method.
[Marks 2]
Question 6
a) List two key applications of the Dirichlet Model in market analysis.

[Marks 2]
b) How do you establish whether the Dirichlet Model fits some observed data?
[Marks 2]
c) Discuss the four aspects of consumer purchasing behavior that are captured by the
Dirichlet model.
[Marks 4]
d) If the Dirichlet model fits observed data, what does it tell you about market
segmentation for competing brands?
[Marks 2]

Page 5 of 8

MARK2010 Market Analysis

Question 7
a) List three of the assumptions of the Bass model

[Marks 3]
b) What are the two patterns of adoption of a new product? Explain the Bass model
parameters p and q.
[Marks 2]
c) The Bass Model was fitted to the year-by-year introduction of a technology in
Australia, commencing in 2010. Use the parameter values in Table 7 and the Bass
Equation to calculate the number of adoptions in 2010 and in 2011. Calculate also the
cumulative adoptions prior to 2012. Prior to 2010 there were 100 adopters.
Table 7: Parameters for the Bass Model
p
0.35
q
0.22
6,000
N
[Marks 5]
Question 8 7
a) What is the advantage of polarization compared to the other behavioural loyalty
metrics?
[Marks 2]
b) List three key applications of polarization in market analysis.
[Marks 3]
c) Calculate the market share, repeat rate and polarization for Coopers and Tsingtao for
the data set in Table 8. Does Coopers have the greater level of loyalty?
Table 8: Two purchases from the product category are recorded for each of twelve
shoppers.
Shopper
First Purchase
Second Purchase
1
Coopers
Tsingtao
2
Coopers
Coopers
3
Tsingtao
Tsingtao
4
Coopers
Coopers
5
Tsingtao
Tsingtao
6
Tsingtao
Tsingtao
7
Coopers
Coopers
8
Coopers
Coopers
9
Tsingtao
Coopers
10
Coopers
Coopers
11
Coopers
Coopers
12
Coopers
Coopers
[Marks 5]

Page 6 of 8

MARK2010 Market Analysis

END OF EXAMINATION
Attachment A: Formulae

Linear Response Function

Y = a + bX

ADBUDG Response Function

Xc
Y = b + (a b )
d + Xc

Bass Equation

Page 7 of 8

MARK2010 Market Analysis

Attachment B
Students may find this table useful in calculating the brand performance measures. You
may hand this table up with your exam paper.

Name:

Student ID:

Number of Shoppers
Aggregated Raw Data
Brand
A
Shopper 01
Shopper 02
Shopper 03
Shopper 04
Shopper 05
Shopper 06
Period Total
Average Purchase Rate
Market Share
Number of Buyers
Penetration
Purchases Frequency
Share of Category Requirements (SCR)
Category purchases by buyers of brand
Aggregate SCR
100% Loyals, also known as Sole Buyers
100% Loyals

Page 8 of 8

Brand
B

Brand
C

Brand
D

Category
Total