BUSN 101 - CH 11 Mini Sims- Marketing Processes and Consumer Behavior
Now that you've conducted marketing research, you want to determine the target market for the new service. How would you best describe the demographic variables for this target market?
AGE: Age over 60 Age between 46 to 60 Age between 30 to 45 Age under 30 INCOME: Income Above $75,000 Income between $50,001 to $75,000 Income between $25,000 to $50,000 Income less than $25,000 GENDER: Gender Female Gender Male 5 out of 5 points earned: When asked to rank the variables from best to worst, you correctly identified all the items. Great job!
You're scanning the morning news and realize that several factors in the external environment could positively impact the potential growth of the medical spa. Which of these news stories has the potential to have the greatest positive impact on the success of the medical spa?
Anti-Aging Industry Booms for Baby Boomers 5 out of 5 points earned: You chose "Anti-Aging Industry Booms for Baby Boomers." That was the best choice. This would have the greatest positive impact for your medical spa if the medical spa can offer more anti-aging treatments for baby boomers (those born between 1946 and 1964) and if the area has a significant population of baby boomers.
You've decided to move forward with more market research on offering facial resurfacing treatments designed to reduce wrinkles and age spots. Which research method is best suited to identify if this is a service that customers would want?
Focus Group 5 out of 5 points earned: You chose focus group. This was the best choice. By talking directly with potential clients in focus groups, you can learn firsthand what they would want and expect from this type of cosmetic procedure.
The third potential growth opportunity is to add treatments designed to enhance the volume, length, or thickness of eyelashes and eyebrows. Once again, in purchasing marketing data from the marketing research company, you want to make wise purchasing choices. Of the choices shown, which would you consider to be the most important in evaluating the potential of this growth opportunity?
Percentage of area households with an income of more than $50,000 5 out of 5 points earned: You chose income over $50,000. This was one of the best choices. Statistics have shown that the vast majority of patients who have nonessential cosmetic procedures have household incomes in excess of $50,000.
Your first step in pursuing expansion is to do some marketing research. After some initial consideration and research into what services are currently available in the area, you identify three potential growth opportunities for the medical spa. The first potential growth opportunity is to add nonsurgical procedures for removing fat and cellulite -- also known as noninvasive body contouring. You plan to purchase some marketing data from a marketing research company, but you have a limited budget, so you want to make wise choices in purchasing the data. Of the choices shown, which would you consider to be the most important in evaluating the potential of this growth opportunity?
Percentage of area population that is overweight and/or obese (body mass if 30 or more). 5 out of 5 points earned: You chose overweight and/or obese. This was the best choice, because people who are overweight or obese would be the most likely group for a cosmetic procedure to reduce fat and cellulite.
The second potential growth opportunity is to add facial resurfacing treatments designed to remove age spots and wrinkles. Once again, in purchasing marketing data from the marketing research company, you want to make wise purchasing choices. Of the choices shown, which would you consider to be the most important in evaluating the potential of this growth opportunity?
Percentage of the area population age 40 and older 5 out of 5 points earned: You chose 40 and older. This was the best choice, because people under the age of 40 will not be the most likely candidates for treatments designed to remove age spots and wrinkles. It would also be important to know how much of the population is male vs. female, because women typically have more nonsurgical cosmetic procedures than men.
There are two main types of data collected through marketing research: Secondary data is already available from research studies previously performed by government agencies, chambers of commerce, trade associations, and other organizations. For example, a researcher can get a vast array of demographic, housing, social, and economic data from the U.S. Census Bureau. Secondary data is often easy to find, and much of it is free or low cost, so it can save time, effort, and money. The downside is that it isn't customized to a marketer's needs. Primary data is collected from newly performed research that is tailored to a company's needs and is conducted either by you (the marketer) or by a marketing research company that you pay to conduct the research for you.
Primary Data: Focus group interviews Mail survey Face-to-face interviews Electronic questionnaires Secondary Date: Survey conducted by the American Academy of Cosmetic Surgery Real median household income data published by the Federal Reserve Bank
From: Dennis Cummings, Marketing Research Pros Subject: Research Data Here is the marketing research data that you requested. Please give me a call if you have any questions or if you'd like to discuss the data further.
Skin resurfacing treatments to remove age spots and wrinkles 5 out of 5 points earned: You chose skin resurfacing. This was the best choice, for several reasons. First, the percentage of population age 40 and older is higher than the state average, and that points to an aging population that may be interested in reducing wrinkles and age spots. Second, there is a higher percentage of women than the state average. Finally, the median household income in the area is significantly higher than throughout the state.
You've selected the headline "Anti-Aging Industry Booms for Baby Boomers" as the factor having the greatest positive impact for the medical spa. Which of the forces in the marketing environment does this most strongly reflect?
Sociocultural environment 5 out of 5 points earned: You chose sociocultural environment. That was the best choice. The sociocultural environment reflects the customs, mores, values, and demographic characteristics of the society in which an organization functions. The aging of the baby boomers is a demographic characteristic, and the desire to continue to look young by using anti-aging products and procedures reflects their values.
Marketing plans and strategies aren't determined unilaterally by any business. Rather, they are strongly influenced by powerful outside forces that are beyond the business's control. These forces can work in favor of your business and enhance its ability to meet customers' wants and needs (not to mention its ability to make a profit), or they can severely limit your company's offerings. These external forces in the marketing environment include the political-legal environment, the sociocultural environment, the technological environment, the competitive environment, and the economic environment. Let's take a quick look The political-legal environment consists of government laws and regulations that have an impact on businesses. Consider the "alphabet soup" of regulatory agencies here in the United States that enforce laws and regulations and impact marketing efforts: the EPA, the FCC, the CPSC, the FDA, and the FTC, to name just a few. The sociocultural environment also impacts marketing. Changing social trends, consumer preferences, demographic shifts, and values force companies to develop and promote new products. For example, the increase in the number of two-working-parent and single-parent households has resulted in daycare businesses becoming one of the fastest growing industries in the United States. The technological environment creates new goods and services and enables firms to produce products more efficiently and less expensively. Other technologies, like the Internet and social media, have significantly changed the way companies communicate with existing and prospective customers. In a competitive environment, marketers must convince buyers that they should buy one company's products rather than another's. The more sellers of a similar product or service, the more competitive the environment in which the firm operates. Finally, the economic environment influences businesses because factors like inflation, interest rates, unemployment, and economic growth rates impact the willingness and ability of consumers to buy goods and services.
competitive environment: A Competitor introduced a new product at a trade show political-legal environment: The Securities and Exchange Commission is ramping up cybersecurity requirements on financial services firms. sociocultural environment: Racial and ethnic diversity are increasing. technological environment: A manufacturing innovation has made it possible for your company to customize its products at a very little additional cost. Great job! You categorized all the items correctly. You have a good grasp of the external environment and the corresponding forces to which marketers must adapt.
