Cambridge Technicals Level 3 in Business

Lesson Element

Unit 5: Marketing and market research

Understanding the significance of constraints on marketing

Instructions and answers for tutors

These instructions cover the learner activity section which can be found on page 5. This Lesson Element supports Cambridge Technicals Level 3 in Business.

When distributing the activity section to the learners either as a printed copy or as a Word file you will need to remove the tutor instructions section.

The activity

In this Lesson Element learners will be introduced to the factors which may constrain marketing activities within a business. Learners will carry out research into the constraints and prepare presentations to share their research with others. The class will then use the information to conclude which constraint(s) they believe to be the most significant and to analyse examples of marketing communications.

Suggested timings

Activity 1

· 2 hours

Activity 2

· 20 minutes

Activity 3

· 1 hour

Activity 1

· Divide your class into groups

· Give each group a card (see pages 3 to 10) which will state a research task relating to the teaching content for LO2. Learners must prepare a presentation to be performed to the remainder of the class which summarises their research

· You may also want to encourage groups to prepare a handout to provide to their peers which summarises the information in the presentation.

http://www.which.co.uk/consumer-rights/regulation/sale-of-goods-act

This resource details the Consumer Rights Act (2015).

http://beta.tutor2u.net/business/reference/marketing-budget

This article explains the marketing budget and how this is set.

https://www.asa.org.uk/Rulings.aspx

This is the Advertising Standards Authority website which explains what they do and provides examples of complaints which they have investigated.

https://www.gov.uk/marketing-advertising-law/regulations-that-affect-advertising

This is a government website which explains the legislation influencing marketing and advertising decisions.

https://ico.org.uk/for-organisations/marketing/

The ICO supports data privacy for consumers. This website explains who they are and what they do.

http://www.which.co.uk/consumer-rights/regulation/data-protection-act#link-5

An explanation of the Data Protection Act (1998) and how this relates to consumer rights.

http://consumers.ofcom.org.uk/tv-radio/

Office of Communications

Explains the role of Ofcom in relation to TV and radio advertising.

http://toolkit.smallbiz.nsw.gov.au/part/21/104/477

This gives a basic overview of the types of cultural constraints which a business might face.

OCR Business for A level – 26 Jun 2015 by Andy Mottorshead, Judith Kelt, Alex Grant

Hodder Education

Chapter 58: ‘External influences on marketing’.

Card 1 – Legal constraints

In your group, you need to research each of the Acts listed below and think about how each of them will act as a constraint on the marketing mix and the marketing activities within a business.
· Sale and Supply of Goods Act (1994)
· Consumer Protection from Unfair Trading Regulations (2008)
· Consumer Protection Act (1987)
· Consumer Rights Act (2015)
· Plus any other legislation which you think is relevant.
Once you have carried out your research, you need to produce a presentation which will be performed to the remainder of your class. This presentation should include:
a) A brief summary of each piece of legislation.
b) Is this legislation needed? Should businesses be honest and truthful even without legislation? Explain your answer.
c) What penalties may be experienced if this legislation is broken? Use examples to support your explanation.
You may find the website listed below useful for your research:
http://www.which.co.uk/consumer-rights/regulation/sale-of-goods-act

Card 2 – Voluntary constraints

In your group, you need to research:
· the role of the Advertising Standards Authority
· the CAP broadcast code
· the CAP non-broadcast code.
Once you have carried out your research, you need to produce a presentation which will be performed to the remainder of your class. This presentation should include:
a) A brief summary of the role of the Advertising Standards Authority and how they may be seen to constrain the marketing activities of a business.
b) Does the advertising of products such as Apple iPhones put pressure on children and young adults to have the latest gadgets? Is this a problem? What are the rules and regulations about advertising to children under 16?
c) What do the CAP broadcast code and the CAP non-broadcast code state that businesses should/should not do in relation to advertising? Use examples to support your explanation e.g. an ‘Oh Lola!’ perfume advertisement was banned by the ASA for breaching the CAP broadcast code. How? Why?
You may find the resources listed below useful for your research:
https://www.asa.org.uk/About-ASA.aspx
https://www.cap.org.uk/Advertising-Codes.aspx

Card 3 – Ethical constraints

In your group, you need to discuss the following ethical issues. You then need to produce a presentation which will be performed to the remainder of your class. This presentation should include:
a) What impact are the examples listed below likely to have on the ‘Place’ section of the marketing mix for the businesses involved? What impact might this have on ‘Price’ and the other sections of the mix?
- Walt Disney to reconsider outsourcing to Bangladesh (May 2013)
http://business.time.com/2013/04/30/bangladesh-factory-collapse-will-force-companies-to-rethink-outsourced-manufacturing/
- Apple admits using child labour (February 2010)
http://www.telegraph.co.uk/technology/apple/7330986/Apple-admits-using-child-labour.html
- Asda’s Bangladesh workers go on webcam (April 2010)
http://www.theguardian.com/business/2010/apr/01/asda-bangladesh-workers-webcams
b) Stereo-types – Do stereo-types exist in advertising and promotion? Is it ethical to use stereo-types in advertising? Use examples to justify your answers.
c) Is online custom advertising an invasion of privacy? Use examples to debate the two sides of this argument and then reach a conclusion.

Card 4 – Cultural constraints

In your group, you need to discuss and research:
· The types of cultural constraints which may affect marketing activities and marketing decisions within a business
· The following examples of marketing failures due to cultural constraints:
- Pampers – Japan
http://impaktpartners.com/services/global-marketing-expertise/
- KFC – China
- http://impaktpartners.com/services/global-marketing-expertise/
- Coca-Cola – introducing a new recipe (1985)
http://www.coca-colacompany.com/history/the-real-story-of-new-coke
- Heineken – 1994 World Cup promotional campaign
https://languagelens.wordpress.com/tag/heineken/
- Plus other examples which you can find
Once you have carried out your research, you need to produce a presentation which will be performed to the remainder of your class. This presentation should include:
a) An explanation of the cultural constraints which businesses might face.
b) An explanation of the examples researched and how each of these affected marketing decisions within that business.
c) What are the drawbacks to a business of not considering cultural issues when making marketing decisions?

Card 5 – Financial constraints

a) In your group you need to research the following financial constraints. Start by finding out what each term means:
- Budget constraints
- Cash flow or liquidity constraints
- Stakeholder preferences e.g. shareholders may want high dividends, consumers may want low prices.
b) Once you have researched this information discuss how you think each of the 4P’s will be affected by these financial constraints and list your ideas. You could do this by using a large sheet of paper and dividing it into 4 sections – one for each ‘P’.
c) Once you have devised your ideas, you need to prepare a presentation which will be performed to the remainder of your class. This should consider each of the 4 P’s in turn and explain the financial constraints on each one. Use examples to support your work.
You may find the resources listed below useful:
http://www.ehow.com/info_8295420_constraint-marketing.html
http://www.dummies.com/how-to/content/set-a-marketing-budget-to-fit-your-small-business-.html
http://bizfinance.about.com/od/cashflowanalysis/g/Cash_Flow.htm

Card 6 – Technical constraints

In your group, you need to discuss the following technical constraints:
· ICT limitations
· Legislation e.g. Data Protection Act (1998) - with reference to use of the internet
You then need to produce a presentation which will be performed to the remainder of your class. This presentation should include:
a) An explanation of the ways in which ICT can constrain marketing decisions and activities, with reference to the 4 P’s. You could consider this in terms of the constraints on how a business can use ICT within its marketing activities and/or how not having access to ICT might constrain marketing activities.
b) An explanation of how the Data Protection Act can constrain the methods of promotion used by a business.
c) What are the Nuisance Calls and Texts Task Force? How might their recommendations constrain marketing activities? Use examples to support your answer.
https://ico.org.uk/for-organisations/marketing/
http://www.which.co.uk/consumer-rights/regulation/data-protection-act#link-5
http://www.which.co.uk/campaigns/nuisance-calls-and-texts/know-the-issue/
http://www.which.co.uk/documents/pdf/nuisance-calls-task-force-recommendations-388317.pdf

Card 7 – Employees as a constraint

In your group, you need to discuss the following statements and whether you agree with them:
· ‘A company's employees are its greatest asset, particularly in service-based operations where your people are your product.’ Sir Richard Branson.
http://biz-align.com/us-vs-them-article-by-richard-branson-with-comments-by-denny-thurman/
· "Your website is your greatest asset. More people view your webpages than anything else." -- Amanda Sibley.
http://piktochart.com/101-marketing-and-growth-tips-from-top-entrepreneurs/
You then need to produce a presentation which will be performed to the remainder of your class. This presentation should:
a) Discuss the two views with reference to marketing activities and marketing decision making within a business.
b) Explain how employees can act as a constraint on marketing activities, with reference to the 4 P’s. Consider factors such as:
- how they can influence the quality of products/services
- how they can affect the quantity of products/services produced.

Card 8 – Broadcast Codes (Ofcom) & Trading Standards

Task 1 - In your group, you need to research the Ofcom broadcast code. Once you have carried out your research, you need to produce a presentation which will be performed to the remainder of your class. This presentation should:
a) Summarise the Ofcom broadcast code
b) Explain an example of a complaint which was upheld (and the penalty issued)
c) Explain an example of a complaint which was dismissed
Task 2 – In your group, you need to research the role of the National Trading Standards Board. You also need to discuss the statement taken from the National Trading Standards E-crimes website about mass marketing fraud.
http://www.tradingstandardsecrime.org.uk/mass-marketing-fraud/
Add a section to your presentation which considers:
d) The role of the National Trading Standards Board and their influence on marketing activities.
e) With reference to the extract, what impact do mass marketing scams have on the marketing activities of genuine businesses?

Activity 2

To encourage learners to reflect on which of the constraints is likely to have the biggest impact on marketing activities, you could write/print all of the constraints researched onto sheets of paper and locate these on walls around the classroom.

This is an individual activity where learners now need to use their knowledge to make a decision.

· Ask learners to decide which of the constraints they believe is the most significant i.e. which will have the biggest impact on the marketing which businesses can/cannot undertake?

· Once they have made a decision, ask learners to stand next to the sheet with their choice written on it. You can then question the learners, asking them to justify their final decision.

· Although this activity refers to businesses in general, you could challenge learners by asking them whether they believe that their choice will be the most significant for all businesses or whether it might ‘depend’?

Activity 3

· Divide your class into small groups.

· Provide each group with access to the same range of examples of marketing communications such as leaflets, TV advertisements, radio advertisements etc.

· Their task is to analyse for each example:

o How legislation is/isn’t being complied with

o How ASA guidelines are/aren’t being complied with

o Whether cultural issues have been considered

o Whether ethical issues have been considered.

· Groups should reach a conclusion for each example - if a complaint was received, on what grounds would they uphold the complaint or reject it?

· Groups could then feedback to debate whether they have all reached the same decisions.

https://www.youtube.com/watch?v=qr5Zge14XG0

Asda Christmas advert 2012

This is a useful example of a TV advert which received a number of complaints although the complaints were not upheld.

https://www.youtube.com/watch?v=FjRXJnQiTiE

Volkswagen advert 2008

The ASA ruled that this advert could only be shown after the 9pm watershed due to the level of violence shown.

http://www.theguardian.com/media/2008/jul/28/advertising1

Article explaining why the ASA received complaints regarding a Snickers advert.

https://www.youtube.com/watch?v=KYV1w1dvJsU

Wonga radio advert which was banned by the ASA.

http://www.theguardian.com/money/2013/oct/09/wonga-ad-banned-payday-lender

Article explaining why the Wonga radio advert was banned.

http://www.bbc.co.uk/news/magazine-18243577

This article refers to some of the most complained about TV adverts and why the complaint was upheld/not upheld.

Lesson Element

Unit 5: Marketing and market research

Learner Activity

Understanding the significance of constraints on marketing

A business should operate within defined boundaries when making decisions about their marketing strategy – in other words, they must consider the impact of their decisions and whether these decisions are therefore viable. In this Lesson Element you will research the factors which constrain marketing activities, prepare a presentation to share your findings with your class and then use the information to conclude which constraint(s) are likely to have the greatest impact. You will also consider a range of marketing communications and analyse whether they are fit for purpose in the context of whether the ASA would allow or ban them.

Activity 1

Your tutor will divide your class into groups. Each group will be given a card which explains your research task.

You will then prepare a presentation to summarise your research for the remainder of the group. You may also want to prepare a handout for your peers to refer to when completing their portfolio work for LO2.

Activity 2

Your tutor has written each constraint onto a sheet of paper. These are located around your classroom.

You need to decide which of the constraints you think is the most significant i.e. which will have the biggest impact on the marketing which businesses can/cannot undertake?

Once you have made your decision, stand next to the sheet with your choice written on it. Make sure that you make your own decision – do not just stand with your friend! Your tutor may ask you to justify your decision – so think carefully about what your reasons are.