Comparative Study of the Marketing Mix

ABSTRACT

The research proposal that is going to be addressed is a “Comparative study of the marketing mix elements of price, place, promotion and product on the mid-range supermarkets SPAR and THE CO-OPERATIVE”. The research is also going to look at the consumer buying behaviour and consumer decision making process. The customer perspective of the marketing mix of these mid-range supermarkets and the issues that these organisations face will also be researched.

The literature review and the research methodology that are being described in the proposal will help us to understand their approach towards marketing mix. The research that is going to undertaken will address the issues that the organizations face in making a well blended marketing mix. Overall the research aims to find the solutions to the issues that are being faced by these mid-range supermarkets and try to give some recommendations.

A COMPARATIVE STUDY OF THE MARKETING MIX IN MID-RANGE SUPERMARKETS SPAR AND THE CO-OPERATIVE.

1.0 Introduction:

The research is going to look at the price, place, promotion and product of the marketing mix which is being used by the Spar and The co-operative convenience stores in Aberdeen, Scotland. From the research, the main issues are being identified with regards to, how these mid-range supermarkets are still able to survive in relation to the giant super markets. The research is also going to look at the consumer buying behaviour and decision making process in buying the products from these convenience stores. The product quantity and the range of products will also be identified.

The literature review will give a brief idea of the research which is already done in this particular field and any pitfalls which are to be addressed.

2.0 Aim:

A comparative study of the marketing mix elements of price, place, promotion and product on the mid-range supermarkets SPAR and THE CO- OPERATIVE.

3.0 Objectives:

• Identify the marketing mix that is being followed by Spar and The co-operative by reviewing the literature. The work that is already done in this field will give an idea of Place, price, promotion and product of the marketing mix.
• Qualitative research of the customers of Spar and The co-operative, by inviting them for focus group interviews and collection of the data.
• Quantitative research of the customers who are shopping at the Spar and The co-operative regularly by distributing questionnaires. From this we have to get the information required for consumer buying behaviour and decision making process.
• To analyze the data obtained from the questionnaires and focus groups interviews and compare the statistics to come to a conclusion. This will underpin the critical and success factors in which the mid-range supermarkets Spar and The co-operative are able to make profits.

4.0 Literature Review:

“A literature review can be defined as the selection of available documents (both published and unpublished) on the topic, which contain

information, ideas, data, and evidence written from a particular standpoint to fulfil certain aims or express certain views on the nature of the topic and how it is to be investigated, and the effective evaluation of these documents in relation to the research being proposed” (Hart, 1998).

The literature review is mainly going to concentrate on the marketing mix elements of the price, place, promotion and product of the Spar and the Co-operative. It will also look at different perspectives of consumer

Buying behaviour and consumer decision making process.

“Literature reviews should be succinct and give picture of the state Of knowledge and of major questions in your topic area” (Bell, 2005).

The marketing mix mainly consists of four elements:

• Price
• Place
• Promotion
• Product (Jobber, 2007)

For mid-range supermarkets, a better management of all the four elements of the marketing mix will give them a competitive advantage over the others. The main aim of maintaining a proper marketing mix is to “satisfy or exceed customer needs better than the competitor” (Jobber, 2007).

4.1 Price:

Price is without any doubt the most important part of the marketing mix which plays a crucial role in the success of the organisation. The reason being, the price of the product will give the profit that the organisation will be having from the unit sale of the product (Jobber, 2007). Price of the product does also play an important role in the organisational buying behaviour, as depending on the price of the product; the selling price is set accordingly.

Due to the changes in the demographics and the lifestyle of the people, the elderly and the young people are concentrating more on the location (the nearest the better) rather than the price of the products (Business Source Premier, 2004).

4.2 Place:

“Place involves decisions concerning the distribution channels to be used and their management, the location of the outlets, methods of transportation and inventory levels to be held” (Jobber, 2007). The hectic lifestyle, and the work under time-pressured are the main key drivers of the convenience stores (Business Source Premier, 2004).

4.3 Promotion:

Promotion is another key player in the marketing mix as “advertising, personal selling, sales promotions, public relations, direct marketing,

Internet and online promotions” (Jobber, 2007) all such activities which are undertaken by the organisation to improve the sales. For any kind of organisation it is got to know what kind of promotional mix it is using for the products, as the wrong promotions could change the consumer perception to a negative way.

4.4 Product:

In relation to the size of the store, the variety of the product varies.

In convenience stores the range of the product suits the location (Business Source Premier, 2003). If the products does not suit the location, for example: a lot of frozen food in a place where the people prefer fresh food, there won’t be much sales there by driving the product into losses. Consumers expect the convenience stores to be open when they need them and have the right kind of mix of products and services at all times (BusinessSource Premier, 2004).

5.0 Characteristics of marketing mix:

A successful marketing mix for any kind of organisation should meet Three important criteria:

• It should be able to meet the customer needs
• It should be able to create an competitive advantage
• It should be well managed. (Jobber, 2007)

5.1 Marketing mix meeting the customer needs:

When the organisations try to meet their customer needs, they need to know who are their target customers in order for the core products to be sold. In addition to this, the organisations should also make up if the location of the store is suitable enough for the products to be sold successfully. It should be able to attract the customers and their promotional strategy should be clearly targeted towards their targeted consumers.

5.2 Marketing mix able to create a competitive advantage:

An effective marketing mix which is being used by the organisation is said to be successful only when this organisation achieves the competitive advantage in the market. The attention of the consumers is still being drawn towards the convenience stores because; they are very near in the sense of location. Even though the supermarkets are cheaper in the price, as the consumers want to get a very few items just for immediate usage they do not want to travel long distances so that they can save few pennies.

5.3 A well managed marketing mix:

The marketing mix which an organisation is using should be a dynamic mix of price, place, promotion and product. When all these e four elements are managed in a correct manner, the marketing mix of the organisation will be a successful one. “The retailers can create new value for their customers by expanding their brands well beyond traditional competitive boundaries to generate new revenue streams” (Business source premier, 2004). Marketing mix which the organisation wants to proceed on should be in conjunction with the resources available for the organisation so that it can achieve the targets set.

6.0 Consumer buying behaviour:

“Buyer behavior is based on a complex process by which consumers choose, acquire, use, and dispose of goods and services in order to fulfil their needs and desires” (Business source premier, 2008). the organization need to know how to reach the consumers and convince them to buy their product(s).

For any kind of organisation it is always important to know the buying behaviour of its existing and potential customers (Lancaster and Massingham, 1997). It is really a very important step for the organisations to know the consumer buying behaviour is because of various reasons:

They will be able to make the decision of their marketing mix based on this. And it will answer a few important questions which the organisations

Need to know like:

• Who constitutes the market?
• What does the market buy?
• When does the market buy?
• Why does the market buy?
• How does the market buy?
• Where does the market buy?

(Lancaster and Massingham, 1999).

The predictions about the buying behaviour might change accordingly with the situation. The organisations often work in close relation with the frequent buyer from their stores as they make some consistent decisions on what kind of products they buy. Based on this the organisations vary the number and type of products – for example a fewer varieties of the same product or a smaller packet size (Business source premier, 2004).

7.0 Consumer decision making process:

“Some models of buyer behavior theorize that consumers may change their decision depending on the reason for the purchase” (Business source premier, 2008). Knowing about the consumer decision making process is also a crucial part for the organisations. According to Marlow, there are five hierarchical stages in the decision making process of the consumers. From bottom to top they are: Psychological needs, Safety needs, Social needs, Esteem needs and Self- actualization needs. (Lancaster and Massingham, 1997)

Based on the hierarchy the organisations need to know the different ways to approach the consumer with the same product to make the sale. The psychological needs are the most important and basic of the consumer

needs. When the individuals are satisfied with this they move up along the hierarchy to satisfy the other needs and this is motivated by the Marketing of the organisation. The organisation should know how a product should be marketed in the market to create that need, and to stimulate the motivation of the consumers.

8.0 Research Methodology:

In this research I am trying to use both the qualitative and quantitative research.

8.1 Qualitative approach:

Qualitative research will be done using two batches of customers from

The co-operative and Spar in Aberdeen, Scotland for conducting focus group interviews. “one of the chief reasons for conducting a qualitative

study is that the study is exploratory; not much has been written about the topic or population being studied, and the researcher seeks to listen to informants and to build a picture based on their ideas” (Creswell, 1994).

There is not much research done regarding the marketing mix of Spar and

The co-operative. The qualitative research gives the current perceptions

And ideas of the customers. Qualitative research involves and engages two groups of customers from Spar and The co-operative in Aberdeen, by conducting focus group interviews. The information is collected by recording the interviews with groups. Qualitative research can be effective

only when the researcher listens to the informants and extracts the useful

information.

Focus groups will work much better when a better environment is provided, and the researcher can get the genuine information from the participants when they are calm and relaxed. So it’s better to provide the participants with some refreshments and reassure them to give the genuine information.

In approach to the qualitative research it is better to do a pilot questionnaire which are going to be asked in the focus croup interviews before hand, as it might help the researcher if the questions needs improvement there by providing better understanding. In this present research, the customers of Spar and The co-operative are divided into two mixed groups to take part in the focus group interview as the researcher has a better scope to get richer data.

8.2 Quantitative approach:

Quantitative research will be done distributing the questionnaires to the customers of Spar and The co-operative. “A survey design provides a quantitative or numeric description of some fraction of the population- the sample- through the data collection process of asking questions of people (Flower, 1998). This data collection, in turn, enables a research to generalize the findings from a sample of responses to a population” (Creswell, 1994). When the quantitative research is being carried out, handing out the questionnaires is the best sought process. When conducting this kind of research there should be pilot questionnaire which will be made and tested for any changes to be made. Until and unless the questions are appropriate, the researcher will not be able to extract the right answers that are to be used.

9.0 How will be the research done?

• In the literature review the primary sources of data like academic journals, articles and textbooks are being used to get relevant information on the marketing mix of Spar and The co-operative to identify what kind of work or research which is already done on the subject.
• Questionnaires that are distributed to the customers of spar and The co-operative will be designed for ease of understanding and usage. When the results are received, the important problems or issues will be addressed. To get a very refined and rich data at the least a minimum of 80 replies are expected.
• When preparing the questionnaire, the questions are made in a manner that they are not either biased or leading, to make it easier for the participant to answer them more easily. Every necessary step will be taken to avoid any such kind of mistake. And moreover the more perfect the questions are in the questionnaires, the more effective is the information that is going to be gathered for the research.
• Focus group interviews are conducted in a relaxing environment and recorded, to get the best and high quality information which can be of use. The information that is received from the customers is very much useful to address the issues of the marketing mix which is being followed by Spar and The co-operative as they might bring up the difference they can see in relation with the bigger supermarkets.

The research will mainly look at the 4 P’s of the marketing mix (Price,

Place, Promotion and Product) each in its own perspective in relation to

what Spar and The co-operative follow.

10.0 How will the analysis be done?

All the questionnaire responses that are received will be collated and put through the statistical manipulation of the data from the responses which will give a brief knowledge on the important issues. The data which is received via the focus group interviews are also analysed and compared with the issues represented in the questionnaires for a comparative study. SPSS which is a predictive analytical tool (or) Excel will be used to collate and analyse the results.

11.0 Following ethics:

It is really a very important role of the researcher to follow the ethical rules while doing the research. Especially in a research involving the consumers of fast moving consumer goods (FMCG) as the information that is received should be as confidential as possible, ensuring the responses are anonymous.

12.0 Contribution of the Research:

In the outside world the Spar and The co-operative may seem like surviving the credit crunch, but this research is going to look at their marketing mix (Price, Place, Promotion and Product), and their survival even during these tough times. This research will be contributing to the understanding of the issues of this marketing mix and to address any issues raised.

13.0 Time scale and plan of work:

Week |1 |2 |3 |4 |5 |6 |7 |8 |9 |10 |11 |12 |13 |14 |15 |

LiteratureReview | | | | | | | | | | | | | | | | |

Complete Questionnaire for

Customers of Spar and The co-operative | | | | | | | | | | | | | | | |

Pilot customer Questionnaire | | | | | | | | | | | | | | | | |

Finalise and distribute the questionnaires to the customers of The co-operative and Spar| | | | | | | | | | | | | | | | |

Focus group interviews for first group| | | | | | | | | | | | | | | | |

Focus group interviews for second group | | | | | | | | | | | | | | | | |

Collate and analyse results | | | | | | | | | | | | | | | | |

Write up Dissertation | | | | | | | | | | | | | | | | |

References:

Creswell, W, J., 1994. Research Design: Qualitative and Quantitative approaches. United States of America: SAGE

Ridley, D.,2008. The Literature Review: A step- by- step Guide for Students. London: SAGE

Business Source Premier., 2004 [ONLINE], J Sainsbury: convenience

consolidation, MarketWatch: Food; October 2004, Vol. 3 Issue 10.

Available from:

http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=14684378&site=ehost-live (Accessed on 23rd April 2009).

Business Source Premier., 2004 [ONLINE], Big retailers think small. Country Monitor, Vol. 12 Issue 35. Available from:

http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=15074238&site=ehost-live (Accessed on 19th April 2009).

Business Source Premier., 2004 [ONLINE], Convenient enough?, Food Manufacture, Vol. 79 Issue 9. Available from:

http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=14413740&site=ehost-live (Accessed on 19th April 2009).

JOBBER, D., 2007. Principles and practice of marketing. Fifth edition.

London: McGraw-Hill.

LANCASTER, G and MASSINGHAM, L., 1997. Essentials of marketing. Second edition. London: McGraw-Hill.

LANCASTER, G and MASSINGHAM, L., 1999. Essentials of marketing. Third edition. London: McGraw-Hill.

Business Source Premier., 2008 [ONLINE], Buyer behaviour, Research

Starters Business. Available from:

http://search.ebscohost.com/login.aspx?direct=true&db=e6h&AN=27577660&site=ehost-live (Accessed on 24th April 2009).

Business Source Premier., 2004 [ONLINE], The price of convenience,

Available from:

http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=15065448&site=ehost-live (Accessed on 24th April 2009).