1.3

Question 1

what is the design mix

Answer 1

a strategic tool which encourages a business to focus on 3 different areas when designing there product

Question 2

what are the three elements of the design mix

Answer 2

cost
function
aesthetics

Question 3

what are the two social trends that influence the design mix

Answer 3

1. resource depletion
2. ethical sourcing / sustainability

Question 4

what are the 6 types of pricing strategies

Answer 4

1. cost plus
2. price skimming
3. penetration
4. predatory
5. competitive
6. psychological

Question 5

what is cost push pricing
its positives and negatives

Answer 5

adding a % to the cost of producing to get final price
+easy to calculate
+costs covered and sure profit
- doesn’t consider competition

Question 6

what is price skimming
+ and -

Answer 6

set a high price for a product and lower overtime
+high revenue for low quantity
-may be lower demand
-can be effected by economic factors

Question 7

what is penetration pricing
+and-

Answer 7

setting low price when launching new product
+can easily increase market share
-people question quality
-low profit margins

Question 8

what is predatory pricing
+and -

Answer 8

charging very low price for period of time until rivals leave market
+increase market share
-question quality
-short term loss

Question 9

what is competitive pricing
+and-

Answer 9

charge what competition is charging
+maintain market share
+maintain competitive environment
-less profitability

Question 10

what is psychological pricing

Answer 10

setting price below round figure 4.99
+easier to target specific customers
-consumers don’t always fall for it

Question 11

what are the 5 factors that effect which pricing strategy to use

Answer 11

1. level of differentiation from competitors
2. PED
3. number of competitors
4. brand strength
5. stage in product life cycle
6. costs and need for profit

Question 12

what is a distribution channel

Answer 12

the route a product takes from the manufacture to the consumer

Question 13

what is a multichannel distribution

Answer 13

business that sells through more than 1 way like online and in store

Question 14

what is promotion

Answer 14

informing and persuading customers to buy your products

Question 15

what are the two types of promotion

Answer 15

1. above the line
2. bellow the line

Question 16

what is above the line promotion
+and-

Answer 16

advertising that involves the media
+targeted to the mass market
-expensive

Question 17

what is bellow the line promotion
+and-

Answer 17

advertising on a smaller scale
+ cost effective
+ target particular audience
- size of sponsorship

Question 18

what are 5 ways to build a strong brand

Answer 18

1. quality
2. sponsorship
3. social media
4. advertisement
5. USP

Question 19

what is emotional branding

Answer 19

advertising or brand is attached to lifestyle values or aspirations

Question 20

what are the 3 main benefits of building a strong brand

Answer 20

1. added value
2. charge premium price
3. reduced PED

Question 21

what are the 4 stages of the product lifestyle

Answer 21

1. introduction
2. growth
3. maturity
4. decline

Question 22

what are the characteristics of an introduction in product life cycle

Answer 22

• sales are low but increasing
• negative cashflow
• lots of above line promotion

Question 23

what are the characteristics of a growth in product life cycle

Answer 23

• sales increasing rapidly
• cashflow improving
• still lots of promotion

Question 24

what are the characteristics of a maturity in product life cycle

Answer 24

• sales become more stable
• positive cashflow
• bellow line promotion

Question 25

what are the characteristics of a decline in product life cycle

Answer 25

• sales begin to fall
• remain positive but weak
• no promotion

Question 26

what is an extension strategy

Answer 26

business reforms product or increases advertising to try and rebirth product set to decline

Question 27

benefits and drawbacks to extension strategies

Answer 27

+cost effective
-may damage original product
-original customers may be unhappy

Question 28

what is the Boston matrix

Answer 28

a decision making tool that allows businesses to strategize a product portfolio in relation to market gain

Question 29

what are the 4 sections of the Boston matrix

Answer 29

1. question marks
2. stars
3. dogs
4. cash cows

Question 30

what is a question mark in Boston matrix

Answer 30

product with growing market but low market share

Question 31

what is a star in Boston matrix

Answer 31

product with growing market and large market share

Question 32

what is a cash cow in Boston matrix

Answer 32

product with high market share but low market growth

Question 33

what is a dog in Boston matrix

Answer 33

product with low market share and low market growth

Question 34

+and- of Boston matrix

Answer 34

+ identify poor performing products which need work done to improve
- doesn’t factor in trend and competition

Question 35

what is the mass market

Answer 35

products tend to be generic and suit needs and wants of everyone

Question 36

what is the niche market

Answer 36

smaller more distinctive product with clear USP

Question 37

what is business to consumer (b2c)

Answer 37

business selling to average consumer

Question 38

what is business to business (B2B)

Answer 38

business providing good or service to another business

Question 39

what is an outbound strategy

Answer 39

directing marketing material direct to the consumer whether they’re expecting it or not

Question 40

what is an inbound strategy

Answer 40

attracting potential customers to websites when they are looking