Task 1: LO1 - Compile marketing audits

Review changing perspectives in marketing planning

Referring from Winchester et al (1997), marketing plan is an all-purpose tool that enables the
management to know everything related the company. It is an indication that shows management
what is the flaws of their plan, how to succeed in their goals and redefine the direction in a new
market or new product against the competitors. Nonetheless, it shall be responsive that a good
marketing plan must contain with the consideration of changing perspectives.

Prada was first introduced by Mario Prada in 1913. It mainly emphasize with high quality leather
production on handbags, suitcases, shoes and trunks. However, in 1978, when Miuccia Prada
took over the company, they had been struggling against competition of Gucci. From it, Miuccia
Prada notices they need to change their perspectives in their marketing plan; they need a new
appearance product to beat down Gucci. Therefore, she decided to redesign some of Prada's old
favourites with the purpose of remains customer and attract new customer. The Black classic bag
sales were successful and help Prada recognised as a symbol of upper class elegance.

By 1990, Prada management noticed that their product range is only suitable for upper class
consumer and not middle class customers. From it, they launch a new line product which named
"Miu Miu" with the affordable prices to attract middle class customers. They also introduced the
Prada Sport line along with men's line and lingerie. Until today, Prada has many different
product line with different appearance design while maintaining their high quality standard.

Evaluate an organisation's capability for planning its future marketing activity

Organisational capability defined in terms of its core competence, synergistic effects, strengths,
weaknesses and resources and behaviour. It represents a capacity of an organisation to use its
strengths to overcome it weaknesses and create an opportunities and face in its external
environment.

In this case study, Prada's organisational capabilities are stated below:

Core competence

Uniqueness and creative under leading of Miuccia Prada

Synergistic effects

Brand effect

Resources and behaviour

Global network

Weaknesses
High prices

Availability of product

Lack information in its website

Difficulty in acquiring funding as it is a private company

Strengths

Good quality

Loyal audience

Multi brands stores in worldwide

Recognisable and bright well-known company

Miuccia Prada's uniqueness

Prada has founded in 1913, but yet it still has great potential to go further by increasing and
developing its functional areas - in terms of finance, marketing operations, personnel,
information and general management.

In the view of finance's prospect, Prada should control usage of funds with a budget and
limitation. In marketing's prospect, Prada should increase their brand awareness and understand
with the factors would affect marketing capability in price, promotion, place and product which
would enhance their sales turnover and maintain the brand loyalty. Besides, Prada should be alert
with product waste and loss control and limitations, and ensure there is nothing wrong with the
productive system to produce a good quality product.

They also need to update website information to enhance their information management
capability. Lastly but not least, Prada have consider the factors which influence their personnel
and general management capability.

Examine technique for organisational auditing and for analysing external factors that affect
marketing planning

It is essential to understanding customers as it is a keystone of a marketing planning; it comprises

with auditing and analysing the internal (organisational) and external (market) environments of
the organisation. This involves accumulating appropriate factor at first and then analysing it. The
types of relevant factors divided as internal and external which has shown as below.

Internal

Company mission and objectives

Existing customers - which includes the customer's satisfactions, dissatisfactions, expectations
and relationships.

Company resources - management structure, finance and information technology.

The relationships between staff, partner and capital funders.

External

PEST which is a short for of Political, Economic, Social and Technological considerations.
These factors may impact on organisation's activities.

SWOT which is a short for Strengths, Weaknesses, Opportunities and Threats. It helps to assess
company culture and future situation and as well as assess external environment.

Prospective customers, it requires to understand what are their needs, motivations, behaviour,
purchasing power and locations.

Market, which includes the awareness of market size, growth, price, distributions, promotion,
and product development.

Carry out organisational auditing and analysis of external factors that affect marketing planning
in a given situation

Generally, SWOT analysis is common use to carry out an organisational auditing and analysis of
external factors. SWOT represents Strengths, Weaknesses, Opportunities and Threats; The aims
of SWOT analysis is mainly take advantage of strengths and opportunities the market meanwhile
minimise the weaknesses and eliminate the threats.

Strengths

Market share

Skilled and expertise

Business location

Quality processes and procedures

Innovative and new product or service.

Brand loyalty

Strong financial background

Weaknesses
Business location

Lack of skilled and expertise

Low market share

Poor quality products or services

Poor financial background

Bad reputation

Low brand loyalty

Poor distribution network

Opportunities

Competitor weakness

Market growth

Innovation and creative idea

Strong alliances

International market

Ineffective competitors

Threats

New competitor

Taxation

Legal limitations

A competitor has a new, innovative product or service.

Prada's SWOT analysis has shown as below:

Strengths

Good quality
Loyal audience

Multi brands stores in worldwide

Miuccia Prada's uniqueness

Weaknesses

High prices

Availability of product

Lack information in its website

Difficulty in acquiring funding as it is a private company

Opportunities

Global markets growth - China

Outsourcing production

Digital market - Internet

Capture the younger generation consumers - Miu Miu

Franchises opportunity

Threats

European crisis

Strong competitors around worldwide

Fashionable catwalk copycats with lower price - Zara and H &M

Falsification

Task 2: LO2 - The main barriers to marketing planning

2.1 Assess the main barriers to marketing planning

A strong marketing strategy and planning is essential and vital component for any organisation.
However, sometimes, there are certain barriers of marketing planning. For example,
Lack of motivation of change: If stakeholders are demotivated and do not feel the need to
overcome the threats or grab the emerging opportunities, it would be a main barriers to a good
marketing plan.

Overconfident with problems solution: Overconfident would cause a flawed or inappropriate

solution for the problems.

Failure of co-operation between management: Human resources and financial department are not
willing to share resources and goals, manifestly the marketing effort will be impaired.

Lack of knowledge and skills: Without proper knowledge and skills may lead to unrealistic plan
and ideas.

2.2 Examine how organisations may overcome barriers to marketing planning

Professor McDonald has suggested ten rules to overcome the barriers of the marketing planning,
which contains:

Strategy before tactics

Situate marketing within operations

Shared values about marketing

Structure around marketing

Scan the environment thoroughly

Summarize information on SWOT analysis

Skills and knowledge

Systematize the process

Sequence objectives

Style and culture

Task 3: LO3 - Formulate a marketing plan for a product or service

Marketing plan is an essential document as it includes a company market evaluation, goals,

direction and marketing result. Macdonald (1995) introduces a four steps approach for the
marketing plan which includes:

Goal Setting: Organisation Mission defined by Mintzberg as "a mission describes the
organisation's basic function in society, in terms of the products and services for its customers."
Prada's goal is to be leading high end fashion label in worldwide. It comes with a mission that to
make Prada products as a piece of art rather than just a brand.

Situational Review - Marketing Audit: PEST or SWOT analysis.

The marketing audit is a process to identify those existing external and internal factor which will
influences on marketing planning of the company. The process can be conduct with the SWOT
analysis for the internal and external environment or PEST analysis which focuses solely on
external environment. In fact, marketing audit helps to clarifies opportunities and threats and
allows the stakeholders to make alternations to the marketing plan if needed. I have chosen
SWOT as a marketing audit tools for Prada, please refer to 1.4.

Strategy Formulation - Marketing Objectives and Strategies.

Marketing objectives is stated what the company intends to be or to be achieve in the future.
Marketing strategy is a process that allows company to concentrate its limited resources to
increase sales and achieve and build up sustainable competitive advantage. There are several
strategies can be use, for example "ansoff matrix", "bcg matrix", "plc matrix" and "4ps". In this
case, I have chosen 4ps for Prada, please refer to 3.4 in details.

Monitoring and Control - Budget and implementation.

In the process of marketing planning, it shall be aware that marketing control is to monitoring the
whole process as they proceed with and make an alteration if necessary.

Control includes measurement, monitoring and evaluation. In fact, resources are costly and
limited therefore it is essential for a marketer to control a budget and always check with the
implementation. The marketer shall always check with the implication by comparing the actual
progress and the standard progress.

3.2 Explain why marketing planning is essential in the strategic planning process for an

Marketing plan provide information that enables stakeholders to measure the progress and
highlighted the most appropriate marketing strategies. An effective marketing plan helps to
increase product sales and enhance company profit margins. There are several advantages of
market plan, it contains:

Focus on your target market

Identifies consumers' needs and wants

Determines product demand

Identifies potential customers

Identifies competitor and analyse competitive advantage

A measurement for generating the daily cash operational activities and how to make profit.

Manifestly, a good marketing plan will also benefit an organisation with the analysis of how to
achieve the company objectives and capability to create a new opportunities for organisation.
Therefore, it is essential in the strategic planning process for an organisation.

3.3 Examine techniques for new product development

New product development (NPD) is a process which designed to develop, test and consider the
viability of the new product in the market. It helps to distinguish the growth or survival of the
organisation when a new product launch. There are several steps in the NDP process.

Idea generation

It can be obtained from market research by using SWOT analysis.

Idea screening

In this process, unsuitable or unattractive ideas would be abandoning.

Concept development and testing

After the early stage of concept development, it requires to launch a concept testing by asking
the prospective customers' feedback.

Market strategy development

It requires identifying which type of marketing strategy should be use.

Product development

Converts a product idea into a physical form.

Test marketing

Placing the product on sale and observing its actual performance.

Commercialization

Implementing a marketing plan and full production

In 2006, Prada entered into an agreement with LG Electronics to develop a new product in the
market - Luxury design mobile phone. Both companies leveraging their respective skills created
"Prada Phone" with a unique, sophisticated and elegant telephone and also the first touch screen
phone in the world. It achieved great sales: 1,000,000 as a result.
3.4 Justify recommendations for pricing policy, distribution and communication mix

Distribution mix (Place) represents the way of distribution, the methods of transportation, and
also the on-hand inventory level and lastly outlets selection. It is proposed to ensure the
customers will able to find the products when they need it and usually customer will be
expecting good services on the product sales or after the product sales.

Furthermore, it is importance to consider the following options of the product distribution:

Retailing

Internet sales - website

Mail order - throughout brochure

Wholesaler

Nevertheless, the marketer should still consider the product characteristics, company size,
competitors and nature of distributor before decide the final distribution way.

After selected a distribution way for the product, it should be concentrate with the product price.
Price policy would directly affects the product sales, how much profit or loss company gain, to
whom it is sold and what types of services should be attach. There are no fixed rules for setting
the right place for a new product however it should always take into account the product design
cost, the distribution, the promotional and the labour cost. The only recommendation in pricing
strategy is to be sensitive, sensitive with the production cost, marketing cost.

Once a product decided to launch in the market, it requires promotional activities to attract
buyers, to gain awareness and spreading out the product information. The communication mix
includes advertising, personal selling, public relations, online promotion, sales promotion and
also direct marketing. Nonetheless, for each type of promotional tool, it comes with own
strengths and weakness and bring different along different effect to the product. Therefore, it is
essential for the marketer to analyse which type of promotional tool would be most benefit to the
product.

PRADA's Marketing Mix

Product

PRADA line produces high end clothes and accessories for men and women, fragrances,
cosmetics and children's clothes.

PRADA - sub line - Miu Miu is the products with affordable price and targeted young
generation.

PRADA - sub line - Line Rossa is the PRADA's sport collection.

Place

250 PRADA stores in 65 countries

Headquarters located in Milan

Prada also sold their products in:

Online stores

Harrods

Selfridge

Price

PRADA has many product line with different price levels:

Purses & leather goods: 200 - 3000

Shoes: 100 - 500

Fragrance: 40 - 100

Promotion

Magazines Ads: Ads are featured in Elle and Vogue.

Fashion shows: held around the world and it has become the most persuasive marketing tools in
fashion industry.

3.5 Explain how factors affecting the effective implementation of the marketing plan have been
taken into account

In order to maximize profits and minimize risks in a

business, the only reliable way is to tailor a suitable
marketing plan with the particular needs meanwhile using
available marketing tools and information to enhance the
flexibility. However, it is remarkable that there are few
factors should be concern with as there would affect the
effective implementation of the marketing plan or even
impair the whole picture. The factors would affect the
progress have listed down below:
Management not supportive: With the assumption of the director of the company do not agree
with the element of the marketing plan and decided not to support it, manifestly, the marketing
plan would not be suffice as a pathway to the success.

Budget limitation (Financially) - Without sufficient financial support, the marketing team might
not able to complete an appropriate market research.

Illegality: If a marketing plan is against with the law or regulation, it might lead a legal action to
the organisation.

As the factors mentioned above will affect the effective implementation of the marketing plan, it
may concluded as it is essential to taken factors would impair the marketing plan into account in
order to draft out a good marketing plan.

Task 4: LO4 - Ethical issues in marketing

4.1 Explain how ethical issues influence marketing planning

Ethics carrying principles of right conduct that shape the decisions people or organisations make.
Practicing ethics in marketing has deliberately addresses the standards of fairness, moral
principles and wrongs in the organisation. The main purpose of marketing ethics is to stop
anyone to do any deceive or take advantage from unethical activities.

Once our economic system has successfully fulfilled consumer's wants and needs, there would
be a concern on organisations adhering to ethical values rather than simply providing products or
services. The reason of being so, that is due to firstly, when an organisation has behaves
ethically, manifestly its customers would develop positive attitudes about its products, services
and the company itself. With unethical issues in a business, it may lead to bad publicity and
reputation, customers' dissatisfaction, lost the business opportunity and consumers' trust and also
a legal action between consumer and organisation.

In short, unethical marketing practices would directly influence a good marketing process and
affect marketing plan. Hence, most of organisation has trained to be sensitive with customer's
needs and opinions in order to maintain this long-term interest in their business. Moreover, social
responsibilities are subjected to marketing practices to protect consumer rights, avoid unfair
trading and stimulate trade in a wide range.

4.2 Analyse examples of how organisations respond to ethical issues

Adler and Bird (1987) and Stead (1990) suggested few strategies to enhance ethical behaviour
and avoid unethical behaviour in organisations. They suggested that, firstly, top managerial
should encourage ethical consciousness to their subordinates by providing support and care upon
ethical practices. Secondly, it is recommended that top managerial level should focus on the
institutionalization of ethical norms and practices that are incorporated into all organizational
levels.

Besides, organisations should provide an ethical training to strengthen and gain their employees'
personal ethical framework to ensure that it practice employees' self-discipline and capable to
make an ethical decisions in a difficult circumstances. Meanwhile, organisations should be
avoiding these unethical issues happen in their institution:

Product: Misleading product information, lack quality control and deliberately produce poor
quality product, unfit product description.

Price: Expensive price with a poor quality product

Place: Different product price in different location

Distribution: Control the product supply and increase the product selling price when out of stock.

4.3 Analyse examples of consumer ethics and the effect it has on marketing planning

Mintel (1994) explain "ethical consumer" as a consumers who considered environmental issues,
animal issues and ethical issues, including oppressive regimes and armament when shopping. In
order to proceed with a good marketing plan, the organisation shall take consumer's right into
account. As being immoral in product sales and product purchase, it may cause bad attitude or
situation. For example, if customer purchasing product which is illegal or against the law,
obviously the organisation would not consider about customer's right for the sales. It would
directly affect to the market itself and unethical behaviour will be spreading around.

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