Q3: What is BCG Matrix and its implication to formulating companys Marketing

Strategy.
Boston Consulting Group (BCG) Matrix is a four celled matrix (a 2 * 2 matrix) developed
by BCG, USA. It is the most renowned corporate portfolio analysis tool. It provides a graphic
representation for an organization to examine different businesses in its portfolio on the basis
of their related market share and industry growth rates. It is a two dimensional analysis on
management of SBUs (Strategic Business Units). In other words, it is a comparative analysis
of business potential and the evaluation of environment.
According to this matrix, business could be classified as high or low according to their
industry growth rate and relative market share.
I. Relative Market Share = SBU Sales this year leading competitors sales this year.
II. Market Growth Rate = Industry sales this year - Industry Sales last year.
The analysis requires that both measures be calculated for each SBU. The dimension of
business strength, relative market share, will measure comparative advantage indicated by
market dominance. The key theory underlying this is existence of an experience curve and
that market share is achieved due to overall cost leadership.BCG matrix has four cells, with
the horizontal axis representing relative market share and the vertical axis denoting market
growth rate. The mid-point of relative market share is set at 1.0. if all the SBUs are in same
industry, the average growth rate of the industry is used. While, if all the SBUs are located in
different industries, then the mid-point is set at the growth rate for the economy.Resources are
allocated to the business units according to their situation on the grid. The four cells of this
matrix have been called as stars, cash cows, question marks and dogs. Each of these cells
represents a particular type of business.

10 x 1x 0.1 x
Figure: BCG Matrix
1. Stars- Stars represent business units having large market share in a fast growing
industry. They may generate cash but because of fast growing market, stars require
huge investments to maintain their lead. Net cash flow is usually modest. SBUs
located in this cell are attractive as they are located in a robust industry and these
business units are highly competitive in the industry. If successful, a star will become
a cash cow when the industry matures.
 2. Cash Cows- Cash Cows represents business units having a large market share in a
mature, slow growing industry. Cash cows require little investment and generate cash
that can be utilized for investment in other business units. These SBUs are the
corporations key source of cash, and are specifically the core business. They are the
base of an organization. These businesses usually follow stability strategies. When
cash cows loose their appeal and move towards deterioration, then a retrenchment
policy may be pursued.
3. Question Marks- Question marks represent business units having low relative market
share and located in a high growth industry. They require huge amount of cash to
maintain or gain market share. They require attention to determine if the venture can
be viable. Question marks are generally new goods and services which have a good
commercial prospective. There is no specific strategy which can be adopted. If the
firm thinks it has dominant market share, then it can adopt expansion strategy, else
retrenchment strategy can be adopted. Most businesses start as question marks as the
company tries to enter a high growth market in which there is already a market-share.
If ignored, then question marks may become dogs, while if huge investment is made,
then they have potential of becoming stars.
4. Dogs- Dogs represent businesses having weak market shares in low-growth markets.
They neither generate cash nor require huge amount of cash. Due to low market share,
these business units face cost disadvantages. Generally retrenchment strategies are
adopted because these firms can gain market share only at the expense of
competitors/rival firms. These business firms have weak market share because of
high costs, poor quality, ineffective marketing, etc. Unless a dog has some other
strategic aim, it should be liquidated if there is fewer prospects for it to gain market
share. Number of dogs should be avoided and minimized in an organization
The BCG Matrix made a significant contribution to strategic management and continues to
be an important strategic tool used by companies today. The matrix provides a composite
picture of the strategic position of each separate business within a company so that the
management can determine the strengths and the needs of all sectors of the firm. There are
numerous benefits or better worded as positive implications provided by this matrix. Benefits
of the BCG matrix are such as:

It is very simple to use and explain, as there are only two dimensions and four
quadrants

It is a reputable and long-standing strategic model that has proved to be robust over
time and significant changes in the competitive environment

Usually the measurements required market growth and relative market share are
available to the company, along with competitive measures, making it relatively easy
to execute and prepare

Clear guidance is provided for each quadrant in terms of the approach to investment
and support of business units (or brands or products) perhaps with the exception of
the question mark quadrant (please see discussion of the question mark quadrant)

It is an important model for allocating resources for firms pursuing market share goals
and seeking experience curve benefits
 The firm has a basis for allocating resources across its business units, based upon
competitive position and market opportunity making for a more strategic based
decision

Although the matrix is developed based upon historical/current position, the four
quadrants of the BCG matrix provide some strategic guidance for the future

The matrix is more beneficial for large-scale manufacturing operations where

experience curve benefits can be realized that is, where they is a strong correlation
between market share profitability. Besides ,it provides a good understanding of the
concept of aligning competitive strengths with market opportunities in the
development of a suitable strategy for the organization.
Q5: Micro & Macro marketing environmental factors that influence a business
operation.
The Impact of Micro and Macro Environment Factors on Marketing
There are two kinds of external marketing environments; micro and macro. These
environments factors are beyond the control of marketers but they still influence the
decisions made when creating a strategic marketing strategy.

Micro Environment Factors

The suppliers: Suppliers can control the success of the business when they hold the
power. The supplier holds the power when they are the only or the largest supplier of
their goods; the buyer is not vital to the suppliers business; the suppliers product is a
core part of the buyers finished product and/or business.

The resellers: If the product the organisation produces is taken to market by 3 rd party
resellers or market intermediaries such as retailers, wholesalers, etc. then the
marketing success is impacted by those 3rd party resellers. For example, if a retail
seller is a reputable name then this reputation can be leveraged in the marketing of the
product.

The customers: Who the customers are (B2B or B2C, local or international, etc.) and
their reasons for buying the product will play a large role in how you approach the
marketing of your products and services to them.

The competition: Those who sell same or similar products and services as your
organisation are your market competition, and they way they sell needs to be taken
into account. How does their price and product differentiation impact you? How can
you leverage this to reap better results and get ahead of them?
 The general public: Your organisation has a duty to satisfy the public. Any actions of
your company must be considered from the angle of the general public and how they
are affected. The public have the power to help you reach your goals; just as they can
also prevent you from achieving them.
Macro Environment Factors

Demographic forces: Different market segments are typically impacted by common

demographic forces, including country/region; age; ethnicity; education level;
household lifestyle; cultural characteristics and movements.

Economic factors: The economic environment can impact both the organisations
production and the consumers decision making process.

Natural/physical forces: The Earths renewal of its natural resources such as forests,
agricultural products, marine products, etc must be taken into account. There are also
the natural non-renewable resources such as oil, coal, minerals, etc that may also
impact the organisations production.

Technological factors: The skills and knowledge applied to the production, and the
technology and materials needed for production of products and services can also
impact the smooth running of the business and must be considered.

Political and legal forces: Sound marketing decisions should always take into account
political and/or legal developments relating to the organisation and its markets.

Social and cultural forces: The impact the products and services your organisations
brings to market have on society must be considered. Any elements of the production
process or any products/services that are harmful to society should be eliminated to
show your organisation is taking social responsibility. A recent example of this is the
environment and how many sectors are being forced to review their products and
services in order to become more environmentally friendly.
Micro and macro environments have a significant impact on the success of marketing
campaigns, and therefore the factors of these environments should be considered in-depth
during the decision making process of a strategic marketer. Considering these factors will
improve the success of your organisations marketing campaign and the reputation of the
brand in the long term.
Q7: Market segmentation
SOFT DRINK COMPANY SEGMENTATION
A. Coca cola has been taken as an exemplary analysis here.
Coca Cola Company is the world's driving maker, advertiser, and wholesaler of delicate
drinks. Coca Cola utilizes "Multisegment" focusing on method which implies that the
organization has more than single, very much characterized, business sector fragment. It adds
to an advertising blend for each of the fragments. Coca Cola has more than 400 distinct items
line, aggregate of 3,500 item blend.
Geographic segment -Coca Cola has drinks that objectives distinctive age bunches, ethnic
gatherings, genders, ways of life, and so on. Samples: - Oasis-Juice made for the more
youthful working grown-ups, between the ages of 20-30. The item is accessible in distinctive
flavours (berry, lemon, and orange tangerine). It's for the most part prevalent in Britain and
Ireland. - Coca Cola-the most well known soda pop so far that being sold in many nations on
the planet. The vast interest for its taste and the pattern toward healthier way of life affected
Coca Cola to deliver healthier items, for example, Coca Cola Zero, Diet Coca Cola, and so
forth. Coca Cola Zero-targets youngsters that don't need calories yet need the taste. Diet
Coca Cola-targets grown-ups, between 30-50 who are wellbeing cognizant yet need the taste.
Powerade-game beverage, targets competitors between 13-27 ages. Minute Maide-targets
children and grown-ups from 1 year to 10 and 40 or more. It's accommodation to convey. It
targets folks that need their youngsters to drink healthier beverages. Atmosphere Coca Cola's
utilization in the mid year is 60% than 40% in the winter; in this way, the organization's deals
are higher in the late spring. It likewise centers in hot range on the planet.
Demographic segment - Age-15-25 years of age and 40 or more. Gender-targets both sexual
orientations with wide assortment drink. Income-portions distinctive wage level. for
instance, by bundling: for low level pay the organization is offering returnable glass bottle;
for abnormal state salary, the organization is offering coke in tins.
Psychographics segment -Individuals who are brand cognizant won't drink refreshments of
less known brands. They will attempt to demonstrate their status by drinking Coca-Cola. The
level of instruction is another component that the organization is paying consideration on. In
a high rate instruction, the organization can utilize promotions to pass on the organization
rub. Since Coca Cola is a perceived world brand, individuals will drink it without waver.

B. MARKET SEGMENTATION FOR AUTOMOBILES

Geographic segment-Topographical division is a standout amongst the most vital premise
of division of the car part, particularly in expansive measured nations like India, where the
conditions in diverse areas. Taking the division in India itself, we find that fabricates of
tractors would concentrate just on those ranges where agribusiness is of prime significance
and would focus on those agriculturists who have sizeable area property and have the assets
to purchase a tractor. Then again, business vehicle organizations would section the business
sector on the premise of centralization of commercial ventures in distinctive locales.
Extravagance two-wheeter creators would certainly focus on the metropolitan locales for the
offer of their two-wheeter , though little two-wheeter producers would likewise consider
forming urban communities and townships into record amid the procedure of division of their
items.
Demographic segment-Another critical premise for division of the vehicles area is
demographic division. Demographic division gives a base promoting of items as indicated by
the pay, status, age, and so on. Makes of little two wheeler like bajaj bike would essentially
concentrate on the general population's fragment having a place with the white collar class
and here comes lies the demographic division. Then again, extravagance auto producers
would concentrate more on the high wage section. Likewise, demographic division assumes a
critical part in the bike market. Bicycle producers for the most part target youthful to
moderately aged individuals. More produces are accompanying vehicles for ladies, which
have uncommon components and are anything but difficult to utilize. As indicated by the
objective's age business sector gathering, vehicles makers would think of diverse shading
variations, for occurrence splendid and gaudy hues for the youthful and the other way around.
Psychological segment-Taking into account mental division, vehicles makers think of
diverse variation of the models of their items. This has been to a great extent found on
account of autos, where organizations for the most part think of a few variations of the same
model, and it has been seen by industry investigators that the medium's variation of the model
offers the most. Label lines, for example, "Men are Back" (utilized by Maruti Suzuki for the
dispatch of another auto) and "Most likely Male" (utilized by Bajaj for a well known bicycle)
focus on a specific classification of people and help to expand deals and ubiquity in that
portion. Makers of extravagance autos like Ferrari, Porsche, and so forth focus on the general
public's segment with an expansive discretionary cash flow and high status, and this can be
accomplished by mental division.
Behavioral segment-As specified prior, behavioral division is done on the advantages'
premise looked for, steadfastness status, and so forth. This is another essential means for
division in the car segment, and taking once more the case of an auto, Daimler, the producer
of extravagance auto Maybach, alters the autos as indicated by the needs and prerequisites of
the items. In this manner, through a few illustrations, we have perceived how the business
sector for autos is.

C. MOBILE PHONE COMPANY SEGMENTATION

Geographic segmenattion calls for driving the business sector into diverse geological units,
for example, countries, states, locales, provinces, urban areas, or neighborhoods. The
organization can work in one or a couple of geographic regions, or work in everything except
pay consideration on nearby varieties (Chandrasekar 2010). Markets can be considered by
nation or district, by size of city or town, postcode, or by populace thickness, for example,
urban, rural, or country. Geographic division is most regularly utilized by multi-national
mechanical and cutting edge organizations that modify their advertising blend in light of the
varying needs of customers in each of the geographic sections they wish to serve (Kotler,
Marketing Management 2003). This is the most essential sort of division for these
organizations as it is less demanding to vary they item taking into account not just the needs
of purchaser on that area additionally to meet the standard and regulation at that particular
area or religion. Notwithstanding item determination and utilization, geographic division is
vital as to retail store, publicizing with respect for media choice, and enlistment. Be that as it
may, this methodology is just helpful when there are clear locational contrasts in tastes,
utilization, and inclinations. Additionally, geographic division obliged that the client in one
locale or area ought to have homogenous inclination, such condition which in all actuality
can't be satisfied as we frequently found that individuals in one territory, area, region or road
may have distinctive state of mind or needs on particular item e.g. garments, drink, cell
telephone, and so forth. (Boone, et al. 2009)
Demographic Segmentation -In demographic division, the business sector is isolated into
gatherings on the premise of variables, for example, age, family estimate, family life cycle,
sexual orientation, salary, occupation, instruction, religion, race, era, nationality, and social
class (Kotler, Marketing Management 2003). Demographic variables are the most
mainstream measurements for recognizing client bunches. One reason is that shopper needs,
inclinations, and use rates are frequently connected with demographic variables. Another is
that they are effectively measured and regularly shift nearly with buyer needs and use rates
(Ferrell and Hartline 2008). The unpredictability and expenses of the plan additionally stay
moderately low. Despite the fact that the objective business sector is recognize utilizing non-
demographic terms, the connection back to demographic qualities is needed with a specific
end goal to have the capacity to profile the business sector fragment by measuring the
market's span and selecting the media that ought to be achieve the portion proficiently. At the
point when utilized legitimately, demographic variables can give a profitable measurement to
shopper driven business sector division. Age is a typical method for dividing markets and is
the first path in which a business sector is outlined. Kids are focused with ice cream parlor,
garments, music, toys, and sustenance essentially in light of the fact that their needs and
tastes are fundamentally not quite the same as more seasoned individuals. Sexual orientation
contrasts additionally basically utilized by advertisers as lady and man tend to have
distinctive attitudinal and behavioral introductions. Pay or financial status is another critical
demographic variable on the grounds that it figures out if a customer will have the capacity to
manage the cost of an item. Wage or financial trademark involves data about buyer individual
wage, family wage, job status, discretionary cashflow, and resource total assets. Persons in
the same piece of the life cycle may contrast in their life stage. Life stage characterizes a
man's significant concern, for example, experiencing a separation, going into second
marriage and some more (Kotler, Marketing Management 2003). Demographic variables are
not, generally valuable to fragment market. Cahill (2006) focuses out that in spite of the fact
that there for the most part are behavioral contrasts between individuals in term of sex or life
stage, they are, best case scenario showed by just a huge larger part of the gathering. Thusly,
the remaining subset whose conduct does not fit into the demographic's system bunch (e.g.
youths acting like senior citizens, or the other way around) power not appreciate being
reminded that they don't fit in with their associates. Coming to the fancied portion without
culpable anybody having a place or not-having a place with the objective gathering can in
this way turn out to be a testing errand. Truly, clients don't opening themselves into any
classes decided.
Psychographic Segmentation The primary reason for psychographics is to acquire a superior
comprehension of the customers as a man by measuring him/her on numerous mental
measurements and in addition in transit s/he lives, things in which s/he is intrigued, and
his/her supposition on a different scope of items and administrations. Advertisers have
comprehended that to draw in or propel a specific gathering of buyers, it is important to know
how they think and what their qualities and demeanors are, and also who they are regarding
the conventional demographic variables (Ziff 1971).Because the adjustments in individual,
family and occupation all through life influence purchasing conduct, psychographic and
demographic division bases are regularly utilized as a part of blend to better recognize
business sector portions. Behavioral variables, e.g. use rates, can likewise be utilized to
supplement a psychographic division plan. In psychographics division, purchasers are
separated into diverse gathering on the premise of way of life or identity or qualities.
Individuals vary in states of mind, hobbies, and exercises and these influence the items and
administrations they utilize.
D. HOTEL OPERATOR SEGMENTATION
Geographic Segmentation
Geographic division includes focusing on particular shopper gatherings as indicated by their
geographic areas in national and worldwide levels. Hilton's geographic division method
primarily concentrates on the neighborhood inclinations and the area. Case in point, Hilton
open lodgings in London for pulling in for the most part representatives and the
administrations for the most part concentrate on business explorers.
Demographic Segmentation
An arrangement of variables utilized as a part of demographic business sector division
incorporate sex, life-cycle stage, age, wage, social class, and way of life. From this point of
view, Hilton target client portion speak to center and senior matured experts with abnormal
state of pay fitting in with upper social class. Additionally, Hilton Hotels & Resorts primarily
target people that seek after extravagance way of life, and as needs be, the organization
charges premium costs for its items and administrations saw to be of a significant quality.
Psychographic Segmentation
Psychographic division "goes past demographics as it looks at how a man considers, feels and
carries on, utilizing identity, way of life and qualities as dividing variables" (Cant et al., 2009,
p.118). The way of psychographic division utilized by Hilton includes focusing on aggressive
people who might want to express their apparent high status and accomplishment by staying
in five star rooms offered by the lodging at premium costs.
Q10: Discuss the external factors that impact organizations marketing communication
function.
Type of product and type of purchase decision.
Different products also require different types of promotion. Very technical products and very
expensive products (high involvement) often need professional selling so the customer
understands how the product operates and its different features. By contrast, advertising is
often relied upon to sell convenience goods and products purchased routinely (low
involvement) since customers are familiar with the products and they spend relatively little
time making purchase decisions.
Target market characteristics and consumers readiness to purchase.
In order to select the best methods to reach different target markets, organizations need to
know what types of media different targets use, how often they make purchases, where they
make purchases, and what their readiness to purchase is as well as characteristics such as age,
gender, and lifestyle. Some people are early adopters and want to try new things as soon as
they are available, and other groups wait until products have been on the market for a while.
Some consumers might not have the money to purchase different products, although they will
need the product later. For example, are most college freshmen ready to purchase new cars?
Consumers preferences for various media.
Weve already explained that different types of consumers prefer different types of media. In
terms of target markets, college-aged students may prefer online, cell phone, mobile
marketing, and social media more than older consumers do. Media preferences have been
researched extensively by academics, marketing research companies, and companies to find
out how consumers want to be reached.
Regulations, competitors, and environmental factors.
Regulations can affect the type of promotion used. For example, laws in the United States
prohibit tobacco products from being advertised on television. In some Asian countries,
controversial products such as alcohol cannot be advertised during Golden (prime) time on
television. The hope is that by advertising late at night, young children do not see the
advertisements. The strength of the economy can have an impact as well. In a weak economy,
some organizations use more sales promotions such as coupons to get consumers into their
stores. The risk is that consumers may begin to expect coupons and not want to buy items
without a special promotion.
Availability of media.
Organizations must also plan their promotions based on availability of media. The top-rated
television shows and Super Bowl ad slots, for example, often sell out quickly. Magazines
tend to have a longer lead time, so companies must plan far in advance for some magazines.
By contrast, because of the number of radio stations and the nature of the medium,
organizations can often place radio commercials the same day they want them to be aired.
Social media and online media may be immediate, but users must be careful about what they
post and their privacy. Uncontrollable events can affect a companys promotions, too. For
example, when a disaster occurs, TV stations often cut advertisements to make way for
continuous news coverage. If there is a crisis or disaster and your company is in the middle of
a promotion being advertised on TV, you will likely have to scramble to reach consumers via
another medium.

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Q12: Discuss the two strategies available for products in the mature stage of the product
life cycle. For each strategy, describe an example.
There are various strategies that can be implemented to overcome the destructive implication
due the matured stage of a product life cycle. One of the efficient way would be through
revamping the marketing mix strategies over the product. They are such as:
Product strategy:
At maturity stage, companies add features and modify the product in order to compete in
market and differentiate the product from competition. At this stage, it is best way to get
dominance over competitors and increase market share. For instance a laptop which is at it
matured stage of product life cycle can be imposed with differentiation where it can be
transformed in terms of features and design probably into a notebook or tablet.
Pricing Strategy:
Because of intense competition, at maturity stage, price is reduced in order to compete. It
attracts the price conscious segment and retains the customers. For instance a consumer good
such a toothpaste which is at its matured stage may be re-priced or offered at a discounted
price, as the value creation process will attract more sales.
Distribution
New channels are added to face intense competition and incentives are offered to retailers to
get shelf preference over competitors. For instance produces tend to variate their distribution
channels from the existing into more aggressive mode.
Promotion
Promotion is done in order to create product differentiation and loyalty. Incentives are also
offered to attract more customers. For instance offering a matured product with added value
like coupon or vouchers.