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business > 1.3 > Flashcards

1.3 Flashcards

1
Q

what are the four Ps of the marketing mix?

A

Place
Product
Production
Price

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2
Q

what does product include?

A

features
quality
branding
packaging
services
warranties

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3
Q

what does promotion include?

A

sales promotion
advertising
pr
direct marketing

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4
Q

what does place include?

A

channels
market covarage
location
inventory
transport

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5
Q

what does price include?

A

pricing strategies
discounts
payment terms

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6
Q

what is the design mix?

A

the elements that make up a product’s design (function, aesthetics and cost)

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7
Q

what is function?

A

a products intended purpose and the tasks it was made to perform

it is the most important aspect of its design because it determined if it meets the customers needs

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8
Q

what is aesthetic?

A

a products visual and sensory appeal

they play an important part in attracting customers, creating brand loyalty, and generating word of mouth

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9
Q

what is the effect of cost?

A

A well-designed product should balance cost and value, ensuring that customers perceive the product as valuable enough to justify its cost while still maintaining profitability for the manufacturer

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10
Q

what is the reason for promotion?

A

to build brand awareness and loyalty (leads to repeat customers and referrals)

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11
Q

what is advertising?

A

Promotion occurs through paid channels such as television, radio, print media (magazines), and online advertising

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12
Q

advantages of advertising

A

It can reach large audiences and increase brand awareness

Can be used to create a specific brand image or message

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13
Q

disadvantages of advertising

A

Can be expensive

The effectiveness of advertising can be difficult to measure

Many customers tune out or ignore ads

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14
Q

what is direct marketing?

A

communicating directly with customers through email, text message, social media or post

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15
Q

what are the advantages of direct marketing?

A

Businesses can target specific audiences and personalise their message to individual customers

is measurable, which enables businesses to track their results and adjust their strategy accordingly

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16
Q

disadvantages of direct marketing

A

Can be intrusive as customers may perceive it as spam

Can be costly, especially if businesses do not have an established customer database or need to purchase leads

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17
Q

what are sales promotions?

A

Marketing techniques that encourage the purchase of a product or service by offering temporary incentives or discounts such as free samples, buy one get one free (bogof), discount coupons, loyalty cards, and rebates (customers have to mail in to receive money back)

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18
Q

what are the disadvantages of sales promotion?

A

Can quickly boost sales or customer engagement

Can help to clear out stock or promote a new product
Can encourage impulse purchases

Can be targeted to specific segments of customers

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19
Q

disadvantages of sales promotion

A

Can be expensive especially if the promotion requires a heavy discounting

Can attract deal-seeking customers who may not be loyal to the brand

May reduce the sales of full-priced products

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20
Q

what is personal selling

A

Occurs when a salesperson interacts with potential customers one-on-one, either in person or through digital communication channel

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21
Q

advantages of personal selling

A

Allows businesses to build relationships with their customers and understand their specific needs

Enables businesses to provide personalised advice and guidance to customers

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22
Q

disadvantages of personal selling

A

Can be expensive due to the cost of hiring and training sales staff

The impact of personal selling can be limited as it is difficult to scale to large audiences

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23
Q

what is sponsorship?

A

an agreement in which a company provides financial or other support to an event, team, or organization in exchange for marketing exposure

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24
Q

advantages of sponsorship

A

Can help to build brand awareness and credibility

Can create emotional connections with target audiences

Can support specific business objectives, such as entering new markets or reaching new customers

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25
Q

disadvantages of sponsorship

A

Can be expensive, especially for high-profile events or properties

May not directly drive sales

May be subject to negative publicity if the sponsored entity experiences a scandal or controversy

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26
Q

what is public relations?

A

The business seeks to build relationships with the public and manage their reputation

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27
Q

advantages of public relations

A

Can enhance a business’s reputation and credibility

This can lead to increased customer loyalty and sales

Can be cost-effective when compared to advertising or personal selling

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28
Q

disadvantages of public relations (pr)

A

PR can be time-consuming and is difficult to measure the direct impact of

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29
Q

what are digital communications?

A

Refer to any form of marketing or communication that is delivered electronically

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30
Q

advantages of digital communications

A

Can be highly targeted to specific customer segments
Can provide real-time engagement and feedback from customers

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31
Q

disadvantages of digital communications

A

Can be easily ignored or filtered out by customers

May require significant investment in technology or data infrastructure

May be subject to data privacy regulations or security breaches

May not be effective for reaching older or less digitally-savvy customer segments.

32
Q

what is branding?

A

the process of creating a unique and identifiable name, design, symbol, or other feature that differentiates a product/service or company from its competitors

33
Q

what is corporate branding?

A

This refers to the use of a company name or logo to promote all the products or services offered by the company (eg apple)

34
Q

advantages of corporate branding

A

Creates a strong brand recognition and reputation for the company, which can increase customer loyalty and trust

Allows the company to leverage its existing reputation and customer base to introduce new products more easily

Helps to build economies of scale by promoting multiple products under one brand, which can reduce marketing costs and increase profitability

35
Q

disadvantages of corporate branding

A

If a company’s reputation is damaged by a product it can have a negative impact on all the products offered under that brand

If the company faces intense competition in one market, it may affect the sales of all the products offered across other markets

36
Q

what is product branding?

A

This refers to the use of a unique name, design, or symbol to promote a specific product

37
Q

advantages of product branding

A

Creates a distinct identity for the product which can help to differentiate it from competitors and increase brand loyalty

Allows the company to market different products to different segments of the market

Can help to build customer loyalty and trust by associating the product with a specific quality and benefits

38
Q

disadvantages of product branding

A

The cost of creating and promoting a new brand for each product can be expensive

Introducing new products under different brands is difficult as the business must build a new brand for each product from scratch

Different products within the brand may have different levels of quality which can affect customer satisfaction

39
Q

what is own branding

A

refers to the use of a retailer’s name to promote a specific product or service and is often used by supermarkets
E.g. ASDA chocolate, Tesco’s Finest range, and Sainsbury’s Basics range

40
Q

advantages of own branding

A

It can help retailers to differentiate themselves from their competitors by offering unique products

It allows retailers to offer products at a lower cost than branded products which can help to increase sales and profitability

It can help to build customer loyalty by offering exclusive products that are not available elsewhere

41
Q

disadvantages of own brand

A

Own brand products may have a lower perceived quality than branded products which can affect customer loyalty and trust

42
Q

benefits of branding

A

Added Value
Strong branding can add value to a product by creating a perception of quality, reliability, and trust

Ability to Charge Premium Prices
Customers may be willing to pay more for a product that is associated with a well-established brand as they perceive products with strong branding to be of higher quality and therefore worth the extra cost

Reduced Price Elasticity of Demand
Strong branding can also reduce the price elasticity of demand for a product (customers are less sensitive to price changes). This is because customers who are loyal to a brand are more likely to continue purchasing the product even if the price increases

43
Q

what is viral marketing?

A

a strategy where businesses use online platforms to promote their products by creating content at specific times, which can easily be shared and commented on

E.g. During the COVID-19 pandemic, Coca-Cola and McDonald’s ran campaigns that emphasised community which aligned with the public’s need for social support

44
Q

what is emotional branding?

A

a strategy where companies build strong emotional connections with their customers by appealing to their values, beliefs, and emotions

45
Q

what is cost plus pricing?

A

The business calculates the cost of production and then adds a markup to determine the final price

The markup covers the cost of production plus the business’s desired profit margin

46
Q

price skimming

A

The business sets a high price for a new product/service when it is first introduced to the market

This is effective when an established brand is introducing a new product and there is a high demand for it

The high price helps the business to recover its development and marketing costs quickly
The business will then gradually lower the price to ensure sales continue

47
Q

what is penetration pricing

A

The business sets a low price for a new product/service when it is first introduced

effective when a business wants to quickly capture market share and attract price-sensitive customers

Once they have enough customers, the business will start to raise the price

48
Q

what is psychological pricing

A

takes into account the customer’s emotions, beliefs, and attitudes towards the product/service E.g. a business may set its prices at £9.99 instead of £10 as customers perceive the former as a better value

49
Q

how can businesses change their pricing to keep up with social trends?

A

use pricing algorithms to monitor prices of competitors

use dynamic pricing

50
Q

what are distribution channels

A

the various intermediaries through which goods/services move from the manufacturer to the end customer

51
Q

what are the stages of a four stage distribution channel?

A

producer, wholesaler, retailer, and consumer

52
Q

what is a four stage distribution channel used for

A

commonly used for products such as groceries, clothing, and electronics

53
Q

what are the stages in a three stage distribution channel?

A

producer, retailer, consumer

54
Q

what is it commonly used for

A

products with high demand or where the cost of distribution is high

often used for products with high profit margins,

55
Q

what are the stages in a 2 stage distribution channel?

A

producer and consumer

commonly used for products sold online

56
Q

what is drop-shipping?

A

once the business has sold the product, they are shipped directly from producer to the consumer, which reduces cost and complexity

(eg like how amazon gives people a place to sell online)

57
Q

what are the stages of the product lifecycle?

A

development
introduction
growth
maturity
decline

58
Q

what happens in the development stage, and what is the implication?

A

explanation - The focus is on designing and developing the product
The business usually incurs high costs for research and development, market research, and product testing

implication - Cash flow is usually negative during this stage, as the company is investing heavily in the product without generating any revenue
The marketing strategy during this stage is focused on creating awareness and generating interest in the product

59
Q

what happens in the growth stage, and what is the implication?

A

enters this stage when sales begin to rapidly increase
the business focus shifts to building market share and increasingg production to meet the growing demand

implication- Cash flow usually turns positive during this stage as sales revenue increases and costs are spread out over a larger volume of production

The marketing strategy is to differentiate the product from its competitors and build brand loyalty

59
Q

what happens in the maturity stage, and what is the implication?

A

Characterised by slowing sales growth as the product reaches its peak in terms of market penetration

implication- Cash flow is usually positive during this stage as sales revenue continues to come in and costs are reduced through economies of scale
The marketing strategy aims to maintain market share and increase profitability by cutting costs and finding new markets

60
Q

what happens in the decline stage, and what is the implication?

A

Starts when sales begin to decline as the product becomes obsolete or is replaced by newer products
The business focus shifts to managing the product’s decline and reducing costs

implication- Cash flow usually turns negative as sales revenue declines and costs associated with the product’s decline increase
The marketing strategy may involve discontinuing the product, reducing its price to clear inventory, or finding new uses for the product

61
Q

what are extension strategies?

A

the techniques used by businesses to extend the life of a product beyond its natural life cycle

These strategies are designed to boost sales and maintain profitability for a product that has reached the decline stage of its life cycle

62
Q

product related extension strategies

A

changing or modifying the product to make it more appealing to customers and extend its life cycle through things like product improvement, line extension (like coke adding diet coke) or repositioning

63
Q

promotion related extension strategies

A

Involves changing the marketing and promotion of the product to extend its life cycle

eg:
changes to advertising
price promotion
sales promotions (loyalty program)

64
Q

what is the boston matrix

A

a tool used by businesses to analyse their product portfolio and make strategic decisions about each product

65
Q

what is a cash cow, and what are the implications?

A

products with a high market share in a mature market (the entire market is no longer growing)

implication:
They generate significant positive cash flow but have low growth potential

The business invests minimal resources in cash cows as they are seen as stable sources of income

Marketing efforts focus on maintaining their market share and profitability

66
Q

what is a problem child/question mark and what are the implications

A

have a low market share in a high-growth market

have the potential to become stars if the company invests in their development

implication - often a negative cash flow as businesses have to invest in problem child products to increase market share and turn them into starts

Marketing efforts focus on increasing their market share and brand recognition

67
Q

what are star products and what is the implication

A

Star products have a high market share in a high-growth market
The company typically invests in stars to maintain or increase their market share

implication -
generate significant positive cash flow and have the potential for continued growth
Marketing efforts focus on building brand recognition, increasing market share, and maintaining profitability
Stars are valuable assets and the business should focus on maximising their potential

68
Q

what is a dog, and what is the implication?

A

Dog products have a low market share in a low-growth market

implication:
They generate little revenue for the company and have no growth potential
Businesses often move away (divest) from these to focus on more profitable products
Marketing efforts for dog products are minimal or zero

69
Q

marketing strategies for mass markets

A
  • focus on building brand awareness and appealing to a broad audience
  • Advertising campaigns are usually designed to reach as many people as possible and use mass media
70
Q

marketing strategies for niche markets

A
  • focus on targeting a specific segment and building a relationship with them
  • often include technical information
  • ads are more targetted
71
Q

what is B2B (business to business) marketing?

A

focuses on selling products to other businesses

72
Q

pros and cons of b2b selling

A

pros
predictable and stable market, a high level of customer loyalty, and high order and sales.

cons

limited target market, longer purchase decision time, and bargaining power of clients.

73
Q

why is customer loyalty good?

A

drives repeat purchases which helps the firm to reduce marketing costs when launching new products

74
Q

what are some ways a business can develop customer loyalty?

A

providing excellent customer service

offering loyalty cards

offering saver schemes

74
Q
A
75
Q
A

business (18 decks)

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