1.3

Question 1

Promotion

Answer 1

Allows business to communicate with its customers and potential customers, creates awareness

Question 2

Above-the-line promotion

Answer 2

Involves any form of advertising through the media, such as TV or radio

Question 3

Below-the-line promotion

Answer 3

All other forms of promotion that are not advertising, such as sales promotion

Question 4

Brand

Answer 4

Used to distinguish businesses from their competitors in the form of something easily recognisable such as a logo or slogan

Question 5

Social trends

Answer 5

Allows businesses to maximise their brands: social media, viral marketing, emotional marketing

Question 6

Price

Answer 6

Determines the demand for a product as well as the contribution of a product and the profit margin for the business

Question 7

Dynamic pricing

Answer 7

Price can fluctuate with the level of demand, such as hotel rooms

Question 8

Penetration pricing

Answer 8

Initial price is low in order to undercut competitors and over time the price may increase as demand grows

Question 9

Price skimming

Answer 9

Initial price is high and is lowered over time, such as when the well established Apple comes out with a new product

Question 10

Competitive pricing

Answer 10

the business sets pricing based on competitors prices, avoids price wars

Question 11

psychological skimming

Answer 11

bases prices on the nearest whole number to trick consumers into thinking the price is lower. for example £9.99 appears cheaper than
£10

Question 12

cost-plus pricing

Answer 12

bases the price on the unit costs and then adds a % as a mark-up.

Question 13

distribution

Answer 13

how the product gets to the customer, the key is to make it easy and convenient for the customer to maximise sales

Question 14

wholesales

Answer 14

take bulk quantities from manufacturers and distribute them across a network of retailers

Question 15

ways of adapting price to reflect social trends

Answer 15

• auction sites
• price comparison sales
• personalised pricing
• subscription pricing

Question 16

what influences distribution

Answer 16

• control over promotion and pricing
• expectations of customers
• nature of the products
• scope/scale

Question 17

product life cycle

Answer 17

1. introduction
2. growth
3. maturity
4. saturation
5. declinr

Question 18

cash cows
(high market share, low market growth)

Answer 18

successful products in mature markets, generate high revenue that can be invested in other areas, little promotion required

Question 19

dogs
(low market share, low market growth)

Answer 19

invest to revitalise or discontinue the product

Question 20

stars
(high market share, high market growth)

Answer 20

a leading brand in the market, distribution must be effective to ensure product availability

Question 21

question marks
(low market share, high market growth)

Answer 21

fast growing market but not yet an established product, requires heavy investment to develop and ensure success

Question 22

boston matrix

Answer 22

the impact of market share and market growth on a business by using 4 categories (dogs, stars, cash cow, question marks)

Question 23

marketing strategies

Answer 23

a set of plans that aim to achieve a specific marketing objective, such as building customer loyalty

Question 24

adapting the marketing mix for mass markets

Answer 24

product: find ways to differentiate
price: competitive pricing + managing costs
promotion: heavy advertising and promotion used
place: