Question

Case Study 1 ( 10 Marks)

Mr. Salim is working as the manager of the marketing department in AL-Bayan company that produces and sells a range of food items. He noticed that the sales are not going as per plan and that the company is not making a profit as it should be. Salim decided to conduct a detailed marketing research to gather all the information and analyze it to find out the real facts that caused problems while marketing their products and services. Marketing research would minimize the gap existed between customers and producers, so they will produce the right products for their consumers.

During a meeting that Salim conducted on the light of the current situation, one of his co workers commented that one important factor that might have an indirect effect on their product is the taste and trends are rapidly changing and that the company should keep enhancing their product accordingly to gain more customer base. During the meeting, they also talked about consumption behavior. Salim agreed on his comments and added that keeping up with competitors is also the key to success and that they need to step it up to satisfy their customers and gain their trust back. All other employees shared their saying on the situation. Many other points made it clear to Salim how much it is important to start carrying on a detailed marketing research even though it might be expensive but will help the organization to get back up on its feet.

Question 1

i. Do you agree with Salim’s decision on marketing research to get back the organization on its feet? Comment. (6 marks, 150-175 words)

ii. Examine how consumers consumption behavior will affect the business of Al Bayan company.

(4 marks, 125-150 words)

Answer 1

i.) Yes, I do agree with Salim's decisions to conduct marketing research. The following are some points that support my agreement:

1. It is the era of marketing, and the basic purpose of marketing is to satisfy the needs and demands of the consumers. By conducting marketing research, the firm may understand the buying behavior of the consumers like their taste preferences, etc, which help the firm in satisfying the consumers in the best possible way. The satisfaction of the consumers ultimately results in increased sales figures.
2. It may be possible that the quality of the products meets the customers' expectations, but due to the higher prices, the consumers are moving towards the competitors, so by conducting the marketing research the management can find this problem easily, and focus on decreasing the costs in order to provide the products at competitive prices to the consumers.

Thus, due to the above reasons, this is required to conduct marketing research, it will help the firm in formulating the various strategies to get its customer base back.

ii.) Effect of consumers' consumption behavior on the business of Al-Bayan company:

Consumers' consumption behavior affects the business in various ways.  AL-Bayan company deals with food items. The consumers' consumption behavior may affect the sales forecast of the Al-Bayan company. So, the company needs to understand the previous consumption behavior of consumers to forecast sales. The changing consumption pattern may adversely affect the business of the company. If the consumers are moving towards the competitors due to any of the reasons such as higher prices, changing taste preferences, etc. It will result in decreased sales volume that will ultimately result in reduced profit margins. Changing consumption behavior may also require the company to redesign the production system and revising the product line that may require a huge cost.

So, on the basis of the above discussion, it is clear that consumers' consumption behavior affects the business firm in various ways.