UNIVERSITY OF MAURITIUS

FACULTY OF LAW AND MANAGEMENT

SECOND SEMESTER EXAMINATIONS
BSc (HONS) MANAGEMENT LEVEL II BSc (HONS) MANAGEMENT WITH FINANCE LEVEL I AND LEVEL II BSc (HONS) MANAGEMENT WITH INFORMATION SYSTEMS LEVEL II BSc (HONS) BUSINESS STUDIES LEVEL II

DATE

THURSDAY 24 MAY 2007

SERIES
MAY 2007

MODULE
MARKETING MANAGEMENT [MGT2060Y(3)]

TIME
9.30 12.30 HRS

INSTRUCTIONS TO CANDIDATES
TIME ALLOWED: THREE (3) HOURS NO. OF QUESTIONS SET: SIX (6)

NO. OF QUESTIONS TO BE ATTEMPTED: FOUR (4) SECTION A IS COMPULSORY AND CARRIES 40 MARKS. SECTION B: ANSWER ANY THREE (3) QUESTIONS. EACH QUESTION CARRIES 20 MARKS. MARKETING MANAGEMENT

[MGT2060Y(3)]

SECTION A CASE STUDY VIRGIN GROUP

Flamboyant iconoclast Richard Branson roared onto the British stage in the 1970s with his innovative Virgin Records. He signed unknown artists that no one would touch and began a marathon of publicity that continues to this day. He has since sold Virgin Records (to Thorn-EMI for nearly $1 billion in 1992), but he has created over 200 companies worldwide whose combined revenues exceed $5 billion. The Virgin name- the third most respected brand in Britain and the Branson personality cement the 200 companies. The Virgin name appears on diverse products and services such as planes, trains, finance, soft drinks, music, mobile phones, cars, wines, publishing, even bridal wear. Despite the diversity, all connote value for money, quality, innovation, fun, and a sense of competitive challenge. The Virgin Group looks for new opportunities in markets with underserved, overcharged customers and complacent competition. Branson called these customer-hostile competitors big bad wolves. Wherever we find them, there is a clear opportunity area for Virgin to do a much better job than the competition. We introduce trust, innovation and customer friendliness where they dont exist, Branson said. For example, Branson launched Virgin Atlantic Airways to take on stodgy, overpriced British Airways. A master of the strategic publicity stunt, Branson announced the new airline in a way guaranteed to gain free advertising. Wearing World War I-era flying gear, he announced the formation of Virgin Atlantic airways on February 29, 1984. The first Virgin flight, on June 22, 1984, took off laden with celebrities and media. The flight came equipped with a brass band, waiters from Maxims in white tie and tails, and free-flowing champagne. The airborne party enjoyed international press coverage and millions of dollars worth of free publicity. Branson knew that photographers have a job to do and theyd turn up at his events if he gave them a good reason.

Similarly, when Branson launched Virgin Cola in the United States in 1998, he steered an army tank down Fifth Avenue in New York, garnering interviews on each of the network morning TV shows as a result. In 2002, he plunged into Time Square connected to a crane to announce his mobile phone business. In 2004, when introducing a line of hip techie gadgets called Virgin Pulse, Branson again took center stage, this time at a nightclub in New York City. He arrived wearing a pair of flesh-colored tights and a portable CD player to cover the family jewels. The Virgin Group evolves with each new business venture. The brand is regenerated, rather than extended in the conventional sense, by each business we become involved in, Branson said. We are in essence an unusual venture capital organization: a branded one. Rather than simply offering financial backing, the Virgin Group offers powerful branding and management resources to stagnant organizations that Branson acquires. Branson usually retains 51 percent control of all Virgin-branded businesses, but he insists on a highly decentralized and flat management structure so that employees are empowered to make decisions. Although Branson avoids traditional market research for a screw it, lets do it attitude, he stays in touch through constant customer contact. When he first set up Virgin Atlantic, he called 50 customers every month to chat and get their feedback. He appeared in airports to rub elbows with customers, and if a plane was delayed, he handed out gift certificates to a Virgin Megastore or discounts on future travel. Virgins marketing campaigns include press and radio ads, direct mail, and point-of-sale material. Virgin Mobile, for example, rolled out a postcard advertising campaign offering consumers discounts on new phones. To identify where listeners to Virgins Web-based Virgin Radio reside, the company created a VIP club. Listeners join the club by giving their postal code, which then lets Virgin Radio target promotions and advertising to specific locations, just as a local radio station would. Once known as the hippie capitalist, now knighted by the Queen of England, Sir Richard Branson continues to look for new businesses and generate publicity in his characteristic charismatic style. Remembering the advice of his friend about publicity if you dont give them a photograph that will get them on the front page, they won turn up at your next event Branson always gives them a reason.
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Source: Sean Hargrave, Making Waves. New Media Age, January 15, 2004, pp.24-27; Adam Lashinsky, Shootout in Gadget Land, Fortune, November 10, 2003, p.74; Sam Hill and Glenn Rifkin, Radical Marketing (New York; Harper Business, 19999); Virgin Holiday Store Hires HHM for Major Push Precision Marketing, January 23, 2004, pp.3-4; Virgin Mobile Postcards Offer Discounts, Precision Marketing, January 23, 2004, pp. 5-6; and <www.virgin.com>.

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MARKETING MANAGEMENT [MGT2060Y(3)] SECTION A (Compulsory) Case study: Virgin Group

Question 1 (a) What have been the key success factors for Virgin? Where is Virgin vulnerable? What should it watch for? [10 marks]

(b)

Which customer characteristics and segmentation variables can be used by Virgin Group? [10 marks]

(c)

What recommendations would you make to Virgins senior marketing executives in going forward? How would you advise them to manage their marketing mix to remain in the competitive arena? [20 marks] [Total: 40 marks]

SECTION B Attempt any THREE (3) questions

Question 2 A large international fast food chain has been considering changing its plastic take-out food containers to one that is easier (environmentally) to dispose of. Its primary concern is its branches in the developed countries. The chain hires you to provide advice on the importance of eco-marketing. Which information should the chain also seek on the marketing environment before making a decision to undertake such a change? [20 marks] Question 3 You are the marketing manager of a reputed bank in Mauritius. How would you vary the emphasis among the tools in your promotion mix when designing promotional strategies for? (a) (b) Individual customers Corporate departments [10 marks] [10 marks] [Total: 20 marks]

Question 4 Six to Seven is a telecommunications company marketing state of the art telecommunications equipment. The company is in the process of developing what it hopes will be the fourth generation type of mobile phone. As part of the product development concept the company is eager to find out more about the potential customer for this product. They are proposing hiring a specialist market research agency with skills in the area of researching buyer behavior, particularly for new product concepts (a) What areas of buyer behavior should this proposed research encompass, and why? [8 marks]
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(b)

What types of research techniques might be useful in researching those areas? Draft a questionnaire that can effectively assist in collecting the required information. [12 marks] [Total: 20 marks]

Question 5 British Airways and American Airlines may use the same kind of aircraft to fly executives first class between New York and London, but British Airways (BA) beats American Airlines by meeting customers needs for convenience and rest at every step of the journey. Explain how companies can maximize customer value by cultivating longterm customer relationships. Illustrate how Customer Relationship Management (CRM) is becoming a major driver of company profitability. [20 marks]

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