MKX9550 past exam paper (1)

now, labor vs. liberal 73:73, well, let's see

here is the 2009 MKX9550 exam paper, totally 8 questions, but you can choose to answer 5 questions in the exam

1. When companies decide to go global, it often makes sense to enter in a few countries, than all. Identify the three criteria that companies prefer countries meet to be viable alternatives for entry. (5 marks) Then discuss the five possible modes of entry into foreign markets, describe and contrast them. (15 marks)


1. Rank high on market attractiveness brand awareness, market size

2. Rank low in market risk

3. Possess a competitive advantage

Indirect exporting: companies typically start with indirect exporting- that is, they work through independent intermediaries. Domestic-based export merchants buy the manufacturer’s products and then sell them abroad. Domestic-based export agents seek and negotiate foreign purchases for a commission. Two advantages: 1. there is less investment. 2. There is less risk.

Directing exporting: companies may eventually decide to handle their own exports. The investment and risk are somewhat greater, but so is the potential return. A company can carry on direct exporting in several ways: 1. Domestic-based export department or division. 2. Overseas sales branch or subsidiary. 3. Travelling export sales representatives. 4. Foreign-based distributors or agents.

Licensing: licensing is simple way to engage in international marketing. The licensor issues a licence to a foreign company to use a manufacturing process, trademark, patent, trade secret or other item of value of for a fee or royalty. The licensor gains entry at little risk; the licensee gains a production expertise or a well-known product or brand name. potential disadvantages. The licensor has less control over the licensee that it does over its own production and sales facilities.

Joint ventures: foreign investors join with local investors to create a joint venture company in which they share ownership and control. A joint venture may be necessary or desirable for economic or political reasons. The foreign company might lack the financial, physical or managerial resources to undertake the venture alone, or the foreign government might require joint ownership as a condition for entry.

Direct investment: the ultimate form of foreign involvement is direct ownership of foreign-based assembly or manufacturing facilities. The foreign company can buy part of full interest in a local company or build its own facilities. If the market appears large enough, foreign production facilities offer distinct advantages. First, the company secures cost economies in the form of cheaper labour or raw materials, foreign-government investment incentives and freight savings. Second, the company strengthens its image in the host country because it creates jobs. Third, the company develops a deeper relationship with government, customer, local suppliers and distributors, enabling it to adapt its products better to the local environment. Fourth, the company retains full control over its investment and therefore can develop manufacturing and marketing policies that serve its long-term international objectives. Fifth, the company assures itself access to the market in case the host country insists locally purchased goods have domestic content.

2. Kotler, Keller and Burton (2009) discuss eight Core Marketing Concepts. List and describe five of these, using examples to illustrate your answer. (10 marks) Further, during this semester, you had to write a marketing plan for a company of your choice. Describe what each of the terms “Internal Capabilities” and “Critical Success Factors” meant in your assignment. Using an example explain the difference between the two terms and the significance of it. (10 marks)

1. Needs, wants, and demands: Needs are basic human requirements. Needs become wants when they are directed to specific objects that might satisfy the need. Demands are wants for specific products backed by an ability to pay.

2. Target markets, positioning, and segmentation: marketers identify and profile distinct groups of buyers who might prefer or require varying product and service mixes by examining demographic, psychographic and behavioural differences among buyers.

3. Offerings and brands: Companies address needs by putting forth a value proposition, a set of benefits that they offer to customers to satisfy their needs. The intangible value proposition is made physical by an offering, which can be a combination of products, services, information and experiences. A brand is an offering from a known source. A brand name such carries many associations in people’s minds that make up the brand image.

4. Value and satisfaction: combination of quality, service and prise. Satisfaction is a person’s subjective judgement. The offer delivers value and satisfaction to target buyers.

5. Marketing channels: Communication Channels, Distribution channels and service channels.

6. Supply chain: Raw material to components to final products. Services delivered to final buyer and companies may expand upstream and downstream.

7. Competition: Actual and potential rival offering. Any substitute a buyer may consider.

8. Marketing environment: internal environment, micro environment, macro environment.

3. Describe the following terms, marketing plan, strategic marketing plan, and tactical marketing plan highlighting what each specifies. (10 marks). Further, in your assignment, you conducted a customer value analysis to reveal the company’s strengths and weaknesses relative to those of various competitors. Outline the steps in this analysis. (10 marks)

A marketing plan is a written document that summarises what the marketer has learned about the marketplace and indicates how the company plans to reach its marketing objectives. It operates at a strategic and tactical level.

Strategic plan: target marketing decisions, value proposition, analysis of marketing opportunities.

Tactical plan: product features, promotion, merchandising, pricing, sales channels and service.

The steps in customer value analysis are as follows:

1. identify the major attributes and benefits that customers value.

2. assess the quantitative importance of the different attributes and benefits.

3. assess the company’s and competitors’ performances on the different customer values against their rated importance.

4. examine how customers in a specific segment rate the company’s performance against a specific major competitor on an individual attribute or benefit basis.

5. monitor customer value over time.


4. Kotler, Keller and Burton(2009) describe the descriptive characteristics that allow marketers to define segments. Contrast the three descriptive approaches, using examples to illustrate how each might be used by a marketer. (10 marks). Further, in segmentation, if the market segments are to be useful, they must rate favorably on five key criteria. List and describe these criteria?

Geographic segmentation: geographic segmentation calls for dividing the market into different geographical nits such as countries, states, regions, cities or neighbourhoods. The company can operate in one or a few areas, or in all, but pay attention to local variations. For example, Hilton Hotels customises rooms and lobbies according to location. Hotels in major business centres, such as Sydney’s refurbished Hilton Hotel, are sleeker and more cosmopolitan, whereas Hilton’s resort hotels, such as those in Hawaii, are open, airy and relaxed.

Demographic. In demographic segmentation, we divide the market into groups on the basis of variables such as age, family size, family life cycle, gender, income, occupation, education, religion, race, generation, nationality and social class.

Psychographic. Psychographic is the science of using psychology and demographics to better understand consumers. In psychographic segmentation, buyers are divided into different groups on the basis of psychological/ personality traits, lifestyle or values.

Five key criteria

1. Measurable. The size, purchasing power and characteristics of the segments can be measured.

2. substantial. The segments are large and profitable enough to serve. A segment should be the largest possible homogeneous group worth going after with a tailored marketing program. It would not pay, for example, for a car manufacturer to develop cars for people who are less than four feet tall.

3. accessible. The sements can be effectively reached and served.

4. differentiable. The segments are conceptually distinguishable and respond differently to different marketing-mix elements and programs. If married and unmarried women respond similarly to a sale on perfume, they do not constitute separate segments.

5. actionable. Effective programs can be formulated for attracting and serving the segments.


5. Michael Porter has identified five forces that determine the intrinsic long‐run attractiveness of a market or market segment. Briefly list and characterise those forces. (10 marks) In addition Kotler, Keller and Burton(2009) suggest a company should monitor three variables when analysing competitors. List and briefly characterise those three variables? (10 marks)

1. threat of intense segment rivalry. A segment is unattractive if it already contains numerous, strong or aggressive competitors.

2. Threat of new entrants. The most attractive segment is one in which entry barriers are high and exit barriers are low. Few new companies can enter the industry and poorly performing companies can easily exit.

3. threat of substitute products. A segment is unattractive when there are actual or potential substitutes for the product. Substitutes place a limit on prices and on profits.

4. threat of buyers’ growing bargaining power. A segment is unattractive if buyers possess strong or growing bargaining power.

5. threat of suppliers’ growing bargaining power. A segment is unattractive if the company’s suppliers are able to raise prices or reduce the quantity supplied.

In general, a company should monitor three variables when analysing competitors:

1. share of market. The competitor’s share of the target market.

2. share of mind. The percentage of customers who named the competitor in responding to the statement, “name the first company that comes to mind in this industry”

3. share of heart. The percentage of customers who named the competitor in responding to the statement, “name he company from which you would prefer to buy the product”

6. Kotler, Keller and Burton 2009) state that physical products could be differentiated in nine ways. Using real examples, state five ways that physical products can be differentiated? (10 marks) Further, they describe a six (6) step process in setting product pricing. One of these steps is ‘Selecting a pricing Method’. State and describe the five price setting methods using real examples. (10 marks).

1. Form. Many products can be differentiated in form- the size, shape or physical structure of a product.

2. features. Most products can be offered with varying features that supplement their basic function. A company can identify and select appropriate new features by surveying recent buyers and then calculating customer value versus company cost for each potential feature.

3. customisation. Marketers can differentiate products by making them customised to an individual.

4. performance quality. Most products are established at one of four performance levels: low, average, high or superior. Performance quality is the level at which the product’s primary characteristics operate.

5. conformance quality. Buyers expect products to have a high conformance quality, which is the degree to which all the produced units are identical and meet the promised specifications.

6. durability. Durability, a measure of the product’s expected operating life under natural or stressful conditions, is a valued attribute for certain products.

7. reliability. Buyers will normally pay a premium for more reliable products. Reliability is a measure of the probability that a product will not malfunction or fail within a specified time period.

8. Repairability. Repairablity is a measure of the ease of fixing a product when it malfunctions or fails. Ideal repairability would exist if users could fix the product themselves with little cost in money or time.

9. Style. Style describes the product’s look and feel to the buyer.


1. make-up pricing. The most elementary pricing method is to add a standard mark-up o the product’s cost. Construction companies submit job bids by estimating the total project cost and adding a standard mark-up for profit. Lawyers and accountants typically price by adding a standard mark-up on their time and costs.

2. target-return pricing. In target-return pricing, the company determines the price that would yield its target rate of return on investment. General Motors has priced its cars to achieve a 15%-20% ROI.

3. Perceived-value pricing. An increasing number of companies now base their price on the customer’s perceived value. Perceived value is made up of several elements, such as the buyer’s image of the product performance, the channel deliverables, the warranty quality, customer support, and softer attributes such as the supplier’s reputation.

4. value pricing. In recent years, several companies have adopted value pricing: they win loyal customers by charging a fairly low price for a high-quality offering. Value pricing is thus not a matter of simply setting lower price; it is a matter of re-engineering the company’s operations to become a low-cost producer without sacrificing quality, to attract a large number of value- conscious customers.

5. going-rate pricing. In going-rate pricing, the company bases its price largely on competitors’ prices, charging the same, more or less than major competitors.

6. auction-type pricing. Auction-type pricing is becoming more popular, especially with the growth f the internet.


7. Think of yourself as the Marketing Manager for the McDonalds Fast Food chain. Explain the five (5) channel management decisions that you have to consider. (20 marks)

1. selecting channel members. To customers, the channels are the company. To facilitate channel member selection, producers should determine what characteristics distinguish the better intermediaries. They should evaluate the number of yearsin business, other lines carried, growth and profit record, financial strength, cooperativeness and service reputation.

2. & 3. training and motivating channel members. A company needs to view its intermediaries in the same way it views its end users. It needs to determine intermediaries’ needs and construct a channel positioning such that its channel offering is tailored to provide superior value to these intermediaries.

4. evaluating channel members. producers must periodically evaluate intermediaries’ performance against such standards as sales-quota attainment, average inventory levels, customer delivery time, treatment of damaged and lost goods, and cooperation in promotional and training programs.

5. modifying channel design and arrangements. A producer must periodically review and modify its channel design and arrangements. It will want to modify them when the distribution channel is not working as planned, consumer buying patterns change, the market expands, new competition arises, innovative distribution channels emerge and the product moves into later stages in the product life cycle.

8. Kotler, Keller and Buron (2009) describe the elements of a macromodel of the communication process. List and describe the nine elements contained. (10 marks) When deciding a marketing program, a company can run the same marketing communications program it uses in the home market or change them for each market. What is this process called? What are the other product and communication strategies that the company can adopt? (10 marks)

Nine elements in the communications process: sender, receiver, message, media, encoding, decoding, response, feedback and noise.

The model emphasises the key factors in effective communication. Senders must know what audiences they want to reach and what responses they want to get. They must encode their messages so the target audience can decode them. they must transmit the message through media that reach the target audience, and develop feedback channels to monitor the response.