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Business A Level > 1.3 Marketing Mix And Strategy > Flashcards

1.3 Marketing Mix And Strategy Flashcards

1
Q

What is included in the design mix?

A
  • function - way a product works? Function? Reliable?
  • aesthetics - is it appealing?, based on judgement of customers, popular way to differentiate
  • economic manufacture - profitable? Is value added during the production process?
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2
Q

Changes in elements of the design mix to reflect social trends:

A
  • concentrate over resource depletion
  • designing for waste minimisation reuse and recycling
  • ethical sourcing
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3
Q

Definition of a product?

A

A product is anything that is capable of satisfying customer needs

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4
Q

What is sustainability:

A
  • source inputs that aren’t damaging the environment
  • minimise waste
  • enable recycling or re-using
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5
Q

What environmental issues must product design need to consider and address?

A
  • use of raw materials, water and other inputs
  • energy use
  • impact on climate change
  • waste and pollution produced
  • impact on employees and the local community
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6
Q

Definition of the marketing mix

A

How a business combines its product, price, use of promotion and place of sale in order to be successful

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7
Q

Description of promotion

A

How the customer is found and persuaded/ informed to buy the product

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8
Q

Examples f the marketing mix being dynamic

A

-increase in competition
- change in consumer taste
- technological advancement

Due to this the business will need to evolve as the environment it operates in changes

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9
Q

Factors that affect the use of the marketing mix:

A
  • level of competition
  • market segment
  • type of product
  • amount of finance available
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10
Q

What is the product life cycle?
And what’s a its stages?

A

Theoretical model which describes the stages a product goes through over its life
- development
- introduction
- growth
- maturity
- decline
- discontinued

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11
Q

Use of product life cycles:

A
  • forecast future sale trends
  • help with market targeting and positioning
  • help analyse and manage a product portfolio
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12
Q

Features of the development stage

A
  • often complex
  • absorbs significant resources
  • may not be successful
  • may involves a long lead time before sales are achieved
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13
Q

Features of the introduction stage:

A
  • new product launched on the market
  • low level of sales
  • high unit costs
  • usually negative cash flow
  • heavy promotion to increase awareness
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14
Q

Strategies at the introduction stage

A
  • encourage customers to make a purchase
  • high promotional spending ot create awareness and inform people
  • either skimming or penetration pricing
  • demand initially from “early adopters”
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15
Q

Features at the growth stage?

A
  • Expanding market but arrival of competitors
  • Fast growing sales
  • Rise in capacity utilisation
  • Cash flow may become positive
  • Unit costs fall with economies of scale
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16
Q

Features at maturity stage?

A
  • Slower sales growth as rivals enter the market = intense competition + fight for market share
  • High level of capacity utilisation
  • High profits as high market share
  • Cash flow should be strongly positive
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17
Q

Features of decline stage

A
  • Falling sales
  • Market saturation or competition
  • Decline in profits
  • More competitors leave the market
  • Decline in capacity utilisation –switch capacity to alternative products
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18
Q

Reasons Why Products Enter the Decline Stage

A
  • Technological advance
  • Changes in consumer tastes and behaviour
  • Increased competition
  • Failure to innovate and develop the product
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19
Q

Strategies for the decline stage

A
  • spend little on marketing the product
  • Price cutting to maintain competitiveness
  • Promotion to retain loyal customers
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20
Q

Ways to extend the Product Life Cycle

A
  • Lower price
  • Change promotion
  • Change product - re-styling and product improvement
  • Look for alternative distribution channels
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21
Q

Weaknesses of the Product Life Cycle Model

A
  • shape and duration of the cycle varies from product to product
  • Strategic decisions can change the life cycle
  • difficult to recognise exactly where a product is in its life cycle
  • Length cannot be reliably predicted
  • Decline is not inevitable
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22
Q

What is the product portfolio analysis/ Boston matrix?

A

Assesses the position of each product or brand in a firms portfolio to help determine the right marketing strategy for each

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23
Q

Features of question marks (high market growth, low market share)

A
  • new products are question marks
  • aren’t profitable
  • need heavy marketing
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24
Q

Features of cash cows (high market share, low market growth)

A
  • maturity phase
  • been heavily promoted
  • produce high volumes, costs are low
  • brings in plenty of money
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25
Q

Features of star products (high market share, high market growth)

A
  • In profitable growth stage, have the most potential
  • future cash cows
  • need to spend lots on promotion to keep their market share
  • may need to increase capacity to keep up with demand
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26
Q

what is the promotional mix?

A

methods a business uses to pursue its marketing objectives

27
Q

aims of promotion

A
  • ensures customers are aware of the existence and positioning of products
  • persuades customers that their product is better than competitors
28
Q

main elements of the promotional mix:

A
  • advertising
  • personal selling
  • public relations
  • sales promotion & merchandising
29
Q

factors influencing promotional decisions and strategies:

A
  • stage in the product life cycle
  • nature of the product
  • competition
  • marketing objectives & budget
  • target market
30
Q

advertising examples

A
  • TV
  • radio
  • online / social media
  • newspapers/ magazines
31
Q

advertising benefits

A
  • wide coverage
  • control of message
  • repetition - message can be communicated effectively
  • effective for building brand awareness and loyalty
32
Q

advertising drawbacks:

A
  • very expensive
  • impersonal, one way communication
  • lots of advertising messages each day = hard to get through
  • lacks flexibility
  • limited ability to close a sale
33
Q

personal selling example

A
  • telephone
  • meetings
  • retail outlets
  • knocking on doors
34
Q

personal selling advantages

A
  • high customer loyalty
  • customised message
  • two way communication/ interactive
  • development o relationship
  • opportunity to close a deal
35
Q

personal selling disadvantages

A
  • high cost
  • labour intensive
  • expensive
  • can reach a limited number of customers
36
Q

sales promotion examples

A
  • coupons/ money off
  • competitions
  • free gifts/ samples
  • loyalty points
  • BOGOF
37
Q

sales promotions benefits

A
  • effective at achieving a quick boost to sales
  • encourage customers to trial a product or switch brands
38
Q

sales promotion drawbacks

A
  • sales effect may only be short term
  • customers may come to expect or anticipate further promotions
  • may damage brand image
39
Q

what are public relations

A

activities that create goodwill toward an individual/ firm/ cause/ product

40
Q

example of public relations

A
  • promoting new products
  • projecting a business image
  • enhancing public awareness
  • obtaining favourable product reviews
41
Q

main aims of public relations

A
  • achieve + publicity
  • build image and reputation
  • communicate effectively with stakeholders & consumers
42
Q

public relations with sponsorship features

A
  • payment for even / person is given in return for consideration of benefit
  • common in: art, sport
43
Q

what is direct marketing

A

promotional material directed through mail, email, social media, phone to individuals and firms

44
Q

definition of a brand

A

product that is easily distinguished from other products so that it can be easily communicated and effectively marketed (recognition)

45
Q

brand name definition

A

name of a distinctive product

46
Q

types of branding:

A
  • emotional
  • viral
  • corporate
  • global
47
Q

benefits of branding:

A
  • adds value, from consumers perspective
  • charge premium prices, demand is more price inelastic
  • builds customers loyalty & aspiration
48
Q

what is a corporate brand?

A

practice of promoting the brand as a corporate entity, instead of specific products/ services

49
Q

what is brand extension?

A

business uses a brand name on a new product that has some of brands characteristics

50
Q

what is brand stretching?

A

where a brand is used for a diverse range of products not necessarily connected

51
Q

what is viral marketing?

A

using social media and online platforms to produce an increase in brand awareness or to achieve other marketing objectives

52
Q

what is emotional branding

A

branding of a product is matched to a lifestyle of consumers to trigger an emotional response, so they buy the product

53
Q

what is price skimming?

A

new products are sold at a high price and then are dropped over time

54
Q

what is price penetration?

A

initially a product is set at a low price and increases over time

55
Q

what is cost plus pricing?

A

when a firm adds a mark up percentage to cover the cost of production per unit

56
Q

what is predatory pricing?

A

when a business sets a deliberately low price to force other businesses out the market

57
Q

what is competitive pricing?

A

when businesses monitor their competitors prices to make sure that their own prices are set the same or lower

58
Q

what is psychological pricing?

A

bases the price on customers expectations. e.g. £9.99

59
Q

what is a distribution channel

A

moves a product through the stages from production to consumption

60
Q

what is direct distribution/selling

A

manufacturer to consumer

61
Q

indirect distribution/ selling

A
  • manufacturer to retailer to consumer
  • manufacturer to wholesaler to retailer to consumer
62
Q

what is multichannel distribution

A

involves a business using more than one type of distribution channel

63
Q

a benefit and drawback from multichannel distribution

A
  • allows more market segments to be reached
  • complex to manage
  • potential from “channel conflict”, competing with retailers by also selling direct
64
Q

example of online distribution

A

downloading media content or streaming- no tangible good

Business A Level (12 decks)

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