Marketing is a management process which involved identifying, anticipating and satisfying the needs of consumers. It also set out to achieve the objectives of an organisation.

Market research is where data is gathered and analysed from the marketplace so that the goods or services of a company can meet the needs of the consumers.

Marketing budget

A marketing budget is a plan made for the marketing department for the forthcoming year. It’s an outline of what the business wants to achieve in terms of sales revenue, sales volume, profit and expenditure. Usually targets are set out month by month and the objective for that year are specified.

The budget set by the marketing department must be one that fits into the business’ overall objectives. It must also take into account any possible changes that occur externally, for example an economic downturn.

A marketing budget can be set in a number of ways:

– Based on the finance available: the amount of money that a business has will have a large say in what the marketing budget can be.

– Based on budget from previous years: some businesses decide to base their marketing budget on what was spent in previous years.

– Based on competitors’ budgets: in industries that are very competitive the marketing budget might be based on that spent by rival companies.

– Based on sales levels from previous years: a business could use the sales revenue from last year on which to base the expenditure for the forthcoming year.

– Based on the expected product portfolio size for the year: if a company plans to extend their product portfolio then they’ll probably have to increase their marketing budget for the advertising and promotion of these new products.

Business to business (B2B) marketing

Also known as industrial marketing, business to business (B2B) marketing is the practice through which an organisation facilitates the sales of their product or service to other organisation which then resell, use the components or services offered, or use them as support to their own activities. B2B marketing is relationship driven and sets out to:

– Maximise the value of the relationship between businesses

– involves a small target market

– involves a multi-step buying process and a long sales cycle

– creates brand identity on a personal level

– involves educational activities

– involves rational buying decisions which are based on business value

Business to consumer (B2C) marketing

Business to consumer (B2C) is where a business markets its product or service to individuals for their personal use. B2C marketing is product driven and sets out to:

• – Maximise the value of transactions
• – Involves a large target audience
• – Involves a single-step buying process and a short sales cycle
• – Creates brand identity through repetition and images
• – Involves merchandising and point of purchase activities
• – Involves emotional buying decisions which are based on status, price or desire

Niche versus mass marketing

A business can choose from two main types of marketing:

– Niche marketing: a business sells to a small market in which they specialise. These business tend to be small in size.

– Mass marketing: a business tries to sell to as much of the market as possible. It usually involves marketing different products to different demographics or promoting the same product differently. These businesses are much larger in size.

There are advantages and disadvantages to both types of marketing as outlined in the table below: