The following recommendation was made by the Marketing manager to the Marketing Advisory Committee of Shell Adhesives.
"Because of declining profits, we must revert back to net marketing instead of marketing our products through the Sell-Well distributors. Net marketing has proven effective in case of Stick Fast adhesives, which is a serious market leader in the field. They have hired the services of 'Web Sell', which has been net marketing for Flora Garments for the past five years. Stick Fast's sales have increased by almost 40% in the last financial year. It also has won the Best Company award at the recently concluded industries meet Generation Next."
Discuss how well-reasoned you find this argument. (Time limit: 30 mins)
Net marketing is possibly one of the best marketing techniques used in the present world. As it can reach the furthest and remotest corners of the earth, its lure is obvious. But the recommendation made by the Marketing Manager of Shell Adhesives to revert back to net marketing is preposterous, and does not take into account all the variables involved.
For instance, the assumption that profits are affected only by the type of marketing used is flawed. Profits are governed by lots of factors, such as, demand, working capital, volume of production, etc. Therefore, change in the type of marketing may not yield the desired results if the other factors are not considered.
Moreover, following the lead of Stick Fast adhesives may not be a good idea considering the fact that they are the market leaders. This means that they already have a large customer base, which in turn creates the awareness for a new product. Also, Stick Fast may be producing adhesives which are different in nature to ones produced by Shell Adhesives, which create a different sort of demand. For example, household adhesives and industrial adhesives have different types of customers.
Finally, the 40% increase in the sales of Stick Fast's adhesives in the past year does not necessarily mean that it was a result of net marketing. It could very well be the reaction to a particularly innovative and attractive product. Thus the claim of a major effect of net marketing can only be substantiated if this trend carries on for a few years.
The argument would have if the above mentioned flaws were taken into account. The Marketing Manager needs to carry out a proper market survey before such a recommendation can be made.
"Because of declining profits, we must revert back to net marketing instead of marketing our products through the Sell-Well distributors. Net marketing has proven effective in case of Stick Fast adhesives, which is a serious market leader in the field. They have hired the services of 'Web Sell', which has been net marketing for Flora Garments for the past five years. Stick Fast's sales have increased by almost 40% in the last financial year. It also has won the Best Company award at the recently concluded industries meet Generation Next."
Discuss how well-reasoned you find this argument. (Time limit: 30 mins)
Net marketing is possibly one of the best marketing techniques used in the present world. As it can reach the furthest and remotest corners of the earth, its lure is obvious. But the recommendation made by the Marketing Manager of Shell Adhesives to revert back to net marketing is preposterous, and does not take into account all the variables involved.
For instance, the assumption that profits are affected only by the type of marketing used is flawed. Profits are governed by lots of factors, such as, demand, working capital, volume of production, etc. Therefore, change in the type of marketing may not yield the desired results if the other factors are not considered.
Moreover, following the lead of Stick Fast adhesives may not be a good idea considering the fact that they are the market leaders. This means that they already have a large customer base, which in turn creates the awareness for a new product. Also, Stick Fast may be producing adhesives which are different in nature to ones produced by Shell Adhesives, which create a different sort of demand. For example, household adhesives and industrial adhesives have different types of customers.
Finally, the 40% increase in the sales of Stick Fast's adhesives in the past year does not necessarily mean that it was a result of net marketing. It could very well be the reaction to a particularly innovative and attractive product. Thus the claim of a major effect of net marketing can only be substantiated if this trend carries on for a few years.
The argument would have if the above mentioned flaws were taken into account. The Marketing Manager needs to carry out a proper market survey before such a recommendation can be made.