Professional Certificate in Marketing (New Syllabus)
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1 Professional Certificate in Marketing (New Syllabus) 521 Assessing the Marketing Environment Academic Session December 2008 Exam This marking scheme has been prepared by the Senior Examiner for the purpose of giving guidance to the CIM marking teams. It should be noted, however, that the marking scheme is just one element of guidance that is given to markers and therefore must not be treated as the definitive guide to how marks are allocated. This marking scheme is issued to TUTORS ONLY as additional support to assist with the delivery of CIM programmes and to enable tutors to enhance feedback and guidance they give to students. THIS MARKING SCHEME MUST NOT BE DISTRIBUTED, NOR THE CONTENTS DISCLOSED, TO ANY PERSON OTHER THAN TUTORS FROM CIM ACCREDITED CENTRES. Please also note that the marking schemes for individual modules will differ in style and format because as stated, these are guidance documents used by the module examination team. The Chartered Institute of Marketing 2008
2 Generic It is likely that candidates will refer to their prepared and appended PEST and SWOT analyses. Examiners should read the PEST and SWOT to enable them to evaluate how the candidates are using this information to develop their answers. Marks are NOT awarded for the PEST and SWOT and, in each task, the simple extraction of prepared information will not demonstrate sufficient evaluation and application to achieve a pass. Guidance is given on the requirements for grades but examiners have discretion to consider the balance of evidence of understanding, evaluation and application and award an overall mark for each task as appropriate. Part A Each of the short answer questions in Part A should have a time allocation of approximately 14 minutes. There is, therefore, no requirement for in-depth analysis. Each question demands that the student demonstrates both knowledge of theory and understanding within the context of the case. Part B Each question in this section is worth 20 marks and as such represents notional exam time of approximately 35 minutes. There is a greater emphasis in Part B on the candidate s ability to evaluate the case information and consider the application of marketing environment issues for Ocean Spray. The format of the answer also becomes more relevant; candidates can be rewarded 3-4 marks per task for good format and presentation of the task. Page 2 of 11
3 PART A ALL TASKS ARE COMPULSORY (40% weighting) Task One Define the following terms and briefly explain their significance to Ocean Spray: monopoly licensing agreement niche market brand loyalty. (Syllabus reference , 3.3) (8 marks) Each term has a maximum award of 2 marks. One mark for the correct definition and one mark for explaining the significance to Ocean Spray. Monopoly: definition: where a single buyer or seller has 25% of the market; this also applies to mergers, acquisitions and market agreements. Ocean Spray needs to monitor levels of market share be aware of monopoly regulations and regulators in market countries manage expansion plans and connected stakeholder relations accordingly Licensing Agreement definition: non-equity agreement granting rights to use intellectual property in return for eg royalties enables Ocean Spray to expand without equity and take advantage of specific restricted trading opportunities issues - management of agreements and protecting the brand Niche Market definition: identifiable sub-segment of a market, a narrowly defined group of potential customers niche markets for health drinks and energy drinks nature of those markets and trends within them Brand loyalty definition: distinctive identity and customers propensity to remain loyal/repeat purchase understanding and measuring brand awareness and loyalty of Ocean Spray impact on customer lifetime value, repeat buying levels, perceptions of quality competitive brands and related loyalty A grade candidates will give clear and accurate definitions, explaining each term s significance clearly and appropriately within the context of the case. B grade candidates will successfully define at least three of the terms and provide satisfactory contextualisation of at least three of the terms. C grade candidates will successfully define at least two terms and provide satisfactory contextualisation of at least two of the terms. D/E grade candidates will have defined and explained less than two of the terms. Page 3 of 11
4 Task Two Explain how the organisational objectives of a co-operative such as Ocean Spray may differ from those of a public limited company such as PepsiCo. (Syllabus reference1.3) (8 marks) 3 marks for demonstrating an appropriate understanding of the two types of organisation, 3 marks for evaluating impact on organisational objectives and 2 marks for appropriate references to organisational objectives. Producer Cooperative has its own legal personality and the producers/members own shares, control strategy and participate in the operations as suppliers and beneficiaries of shared resources and marketing need for shared sense of vision between members objectives led by producers/members focus more on long term sustainability of markets and sustainable income for current and future generations of producers Public Limited Company owned and controlled by shareholders transferability of shares, therefore subject to whims of stock markets objectives led by measures such as return on investment, dividends, market value and usually market share and growth short to medium term objectives Key differences: nature of ownership and owners key drivers long term vs. short term A grade candidates will have demonstrated good understanding of the two types of organisations, highlighting more than two differences and relating to a range of appropriate and justified examples of possible objectives within the two types of organisations. B grade candidates will have demonstrated good understanding of the two types of organisations, highlighting two differences and relating to appropriate and justified examples of objectives within the two types of organisations. C grade candidates will give a simple explanation of the two types of organisations, highlighting two differences and relating to at least one appropriate example of objectives within each type of organisations. D/E grade candidates will have either an inadequate or no explanation of the two types of organisation and will have limited or no illustrative examples of objectives for each type. Page 4 of 11
5 Task Three Define the term strategic alliance and identify TWO potential marketing advantages for Ocean Spray from its strategic alliance with PepsiCo. (8 marks) Award up to 2 marks for clear definition. Award up to 3 marks for each potential marketing advantage for Ocean Spray. definition: agreements between two or more organisations where each partner seeks to add to its competencies by combining resources Advantages could include: enhancing distribution networks production technologies/efficiencies access to new markets enable Ocean Spray to retain independence A grade candidates will have given a clear definition and chosen two appropriate advantages based on the case with relevant and justified explanations. B grade candidates will have given a clear definition and have identified two appropriate potential marketing advantages with a satisfactory explanation. C grade will have given a clear definition and have identified two appropriate potential marketing advantages. D/E grade candidates will have given either no definition or one that suggests a poor understanding. Potential advantages may be absent, inappropriately or poorly explained/justified. Page 5 of 11
6 Task Four Describe TWO research methods that Ocean Spray can use to monitor economic trends as reflected in the business cycle, and explain why it would be useful to monitor them. (Syllabus reference 3.2) (8 marks) 3 marks for each method described for monitoring economic trends and 2 marks for explaining the need to monitor. Methods described must refer to relevant economic data in terms of the business cycle: employment levels and gross domestic product (GDP). Relevant economic data: monitor macro environment, GDP, government borrowing, disposable income, consumer spending, employment levels measure confidence levels and spending patterns within micro environment monitoring above in all relevant national markets Methods: secondary research - Sources of information: ONS, Bank of England quarterly review, financial press, world bank, trade publications primary research - customer attitudes and confidence, spending patterns and forecasts Need to monitor: impact on demand levels within various markets and segments nature of product portfolio and relative vulnerability to economic trends need to align forecast demand with managed supply A grade candidates will have clearly defined economic issues in terms of the business cycle and described in detail two relevant methods for monitoring economic measures that influence the business cycle. Descriptions will have been relevant to the Ocean Spray case and methodology will have been appropriate and justified. Justification of the need to monitor will have been clear and relevant. B grade candidates will have given defined issues and relevant descriptions of research with some reference to the case. Justification will be clear. C grade candidates will have given defined issues and adequate descriptions of methods with little reference to the case. Some justification will have been given. D/E candidates will lack identification of relevant issues and will have inadequate descriptions and/or inappropriate methodology. There will be limited or poor justification. Page 6 of 11
7 Task Five Assess the comparative strengths and weaknesses of niche versus mass marketing, using examples from Ocean Spray to illustrate your points. (Syllabus reference 1.4) (8 marks) 6 marks for a good evaluation of strengths and weaknesses. 2 marks for relating to case. Niche strengths: less competition, enhanced loyalty, premium prices Niche weaknesses: production more costly, customer segments small and dispersed Mass strengths: economies of scale, distribution efficiencies, brand awareness Mass weaknesses: competition, price sensitivity, brand switching Ocean Spray examples could include: niche opportunities relating to social/health trends, link with growing markets, benefits of strategic alliance and competitive strength behind brand and co-operative. A grade candidates will demonstrate a thorough understanding of niche versus mass marketing and will have given clear and relevant descriptions and assessment of a number of comparative strengths and weaknesses. They will have used appropriate examples from the case linked clearly with their assessment. B grade candidates will have demonstrated good understanding of niche versus mass marketing with appropriate strengths and weaknesses and relevant examples. C grade candidates will have demonstrated an adequate understanding, with at least one good strength and weakness for each. D/E grade candidates will not have demonstrated adequate understanding of niche versus mass marketing and will not have assessed relevant strengths and weaknesses. Examples from the case may be poorly linked to this issue. (Total 40 marks) Page 7 of 11
8 PART B ALL TASKS ARE COMPULSORY (60% weighting) Role You are a Marketing Assistant for Ocean Spray and have been asked by the Marketing Manager to prepare a short report for circulation to the Marketing Team. Based on your knowledge of this Unit and your analysis of the Ocean Spray case study material previously provided, address the following tasks. Your previously prepared PESTEL and SWOT analyses must be included as appendices to your report. Task Six Analyse the comparative strengths and weaknesses for Ocean Spray of operating as an agricultural co-operative in the context of the marketing environment. (20 marks) Up to 12 marks for each strength or weakness analysed, with appropriate explanation/justification. 5 marks for appropriate reference to factors in the micro and macro environment. Up to 3 marks can be awarded for format and presentation for clear layout and structure, good use of headings and appropriate summarisation. Key elements of this question are: Agricultural Co-operative This task enables candidates to refer to their PEST and SWOT, drawing out issues that relate specifically to the agriculture sector. Agricultural Co-operative The task also asks candidates to consider the strengths and weaknesses that relate to the organisation s co-operative nature. Comparative strengths and weaknesses Candidates are being asked to refer to these issues related within the microenvironment. Key answer points include: vision, heritage, ownership, brand supply management, ability to adapt to PEST factors decision making processes, stakeholders and accountability nature of agriculture sector market structure, fragmentation, global forces structure of drinks market competitor analysis A grade candidates will have described and analysed at least 8 strengths or weaknesses and will have demonstrated a thorough understanding of market issues specific to the agricultural sector, organisational issues related to co-operative status and competitive issues within the market including competing in markets influenced by multi-nationals. B grade candidates will have described and analysed at least 7 strengths or weaknesses and will have demonstrated a good understanding of market issues specific to the agricultural sector, co-operative status and competitive issues. Page 8 of 11
9 C grade candidates will have described and analysed at least 6 strengths or weaknesses and will have demonstrated a satisfactory understanding of market issues within the agricultural sector and the nature of co-operative status. D/E grade candidates will have insufficient or poorly analysed strengths and weaknesses and will not have demonstrated adequate knowledge of the macro or micro environment. Page 9 of 11
10 Task Seven Identify Ocean Spray s FIVE key stakeholders and evaluate their importance in achieving business growth. (20 marks) 4 marks per stakeholder identified and importance evaluated up to maximum of 18 marks (2 marks for format and presentation). Key answer points could include: co-op members/producers meeting demand, reaching appropriate quality standards, vision and direction PepsiCo enabling distribution staff innovation, NPD, drive, vision customers loyalty, health trends, social trends competitors Tropicana, Copella, Del Monte etc institutional buyers/channels schools, healthy eating media & influencers healthy professionals and media driving demand All pass mark candidates are expected to include both the producer farmers and PepsiCo as critical stakeholders. A grade candidates will have identified 5 key stakeholders and evaluated their ability to influence business growth clearly and appropriately. The answer will be well presented and the significance of members and PepsiCo highlighted. B grade candidates will have identified at least 5 stakeholders and evaluated their ability to influence business growth, clearly and appropriately. C grade candidates will have identified at least 4 stakeholders and evaluated their ability to influence business growth. D/E grade candidates will have identified fewer than 4 stakeholders and will not have adequately evaluated their ability to influence business growth. Page 10 of 11
11 Task Eight Identify FOUR key changes in the MACRO environment outlined within the Ocean Spray case study, and for each one explain its potential impact on Ocean Spray s marketing activities. (20 marks) 4 marks for each key change, made up of 1 mark for appropriate identification and 3 marks for explaining its impact on Ocean Spray. 4 marks for format and presentation. This question requires candidates to focus on changes within the macro environment. No marks can be awarded for simply describing PEST factors. The challenge for students is to consider how the macro environment is changing and relating this clearly to impacts on the organisation. Key question points could include: economic conditions related to food supply alternative land use, market pressure to grow bio-fuels, stakeholder management and pricing issues technology advances in production and distribution significant investment, need for alliances, facilitating NPD rise in obesity in society driving demand for low-cal ranges political pressure on schools to enable and inspire healthy eating increasing demand for lunch box and vending products rise in on-the-go snackers appropriate products, packaging and campaigns healthy eating trends leading to rising demands for super-foods impact on NPD, product labelling and campaigns A grade candidates will have correctly identified 4 macro environmental factors, clearly explaining the changing nature of that factor, referring to evidence. Their explanation of its impact will be well explained, relevant and linked to marketing activities. B grade candidates will have correctly identified 4 macro environmental factors, clearly explaining the changing nature of that factor. Their explanation of its impact will be relevant and linked to marketing activities. C grade candidates will have correctly identified at least 3 macro environmental factors, clearly explaining the changing nature of that factor. Their explanation of its impact will be relevant. D/E grade candidates will have identified 2 or less macro environmental factors and their explanations of impact will be weak or absent. (Total 60 marks) Page 11 of 11
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