1.3 Marketing Mix And Strategy Flashcards
1
Q
What is included in the design mix?
A
- function - intended function
- aesthetics
- economic manufacture
2
Q
Changes in elements of the design mix to reflect social trends:
A
- resource depletion
- reduce waste
- ethical sourcing
3
Q
Definition of a product?
A
A product is anything that is capable of satisfying customer needs
4
Q
What is sustainability:
A
- source inputs that aren’t damaging the environment
- minimise waste
- enable recycling or re-using
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
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
7
Q
Description of promotion
A
How the customer is found and persuaded/ informed to buy the product
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
9
Q
Factors that affect the use of the marketing mix:
A
- level of competition
- market segment
- type of product
- amount of finance available
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
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
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
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
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”
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
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
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
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
19
Q
Strategies for the decline stage
A
- spend little on marketing the product
- Price cutting to maintain competitiveness
- Promotion to retain loyal customers
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
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
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
23
Q
Features of question marks (high market growth, low market share)
A
- new products are question marks
- aren’t profitable
- need heavy marketing
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
25
Features of star products (high market share, high market growth)
- 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
26
what is the promotional mix?
methods a business uses to pursue its marketing objectives
27
aims of promotion
- ensures customers are aware of the existence and positioning of products
- persuades customers that their product is better than competitors
28
main elements of the promotional mix:
- advertising
- personal selling
- public relations
- sales promotion & merchandising
29
factors influencing promotional decisions and strategies:
- stage in the product life cycle
- nature of the product
- competition
- marketing objectives & budget
- target market
30
advertising examples
- TV
- radio
- online / social media
- newspapers/ magazines
31
advertising benefits
- wide coverage
- control of message
- repetition - message can be communicated effectively
- effective for building brand awareness and loyalty
32
advertising drawbacks:
- 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
personal selling example
- telephone
- meetings
- retail outlets
- knocking on doors
34
personal selling advantages
- high customer loyalty
- customised message
- two way communication/ interactive
- development o relationship
- opportunity to close a deal
35
personal selling disadvantages
- high cost
- labour intensive
- expensive
- can reach a limited number of customers
36
sales promotion examples
- coupons/ money off
- competitions
- free gifts/ samples
- loyalty points
- BOGOF
37
sales promotions benefits
- effective at achieving a quick boost to sales
- encourage customers to trial a product or switch brands
38
sales promotion drawbacks
- sales effect may only be short term
- customers may come to expect or anticipate further promotions
- may damage brand image
39
what are public relations
activities that create goodwill toward an individual/ firm/ cause/ product
40
example of public relations
- promoting new products
- projecting a business image
- enhancing public awareness
- obtaining favourable product reviews
41
main aims of public relations
- achieve + publicity
- build image and reputation
- communicate effectively with stakeholders & consumers
42
public relations with sponsorship features
- payment for even / person is given in return for consideration of benefit
- common in: art, sport
43
what is direct marketing
promotional material directed through mail, email, social media, phone to individuals and firms
44
definition of a brand
product that is easily distinguished from other products so that it can be easily communicated and effectively marketed (recognition)
45
brand name definition
name of a distinctive product
46
types of branding:
- emotional
- viral
- corporate
- global
47
benefits of branding:
- adds value, from consumers perspective
- charge premium prices, demand is more price inelastic
- builds customers loyalty & aspiration
48
what is a corporate brand?
practice of promoting the brand as a corporate entity, instead of specific products/ services
49
what is brand extension?
business uses a brand name on a new product that has some of brands characteristics
50
what is brand stretching?
where a brand is used for a diverse range of products not necessarily connected
51
what is viral marketing?
using social media and online platforms to produce an increase in brand awareness or to achieve other marketing objectives
52
what is emotional branding
branding of a product is matched to a lifestyle of consumers to trigger an emotional response, so they buy the product
53
what is price skimming?
new products are sold at a high price and then are dropped over time
54
what is price penetration?
initially a product is set at a low price and increases over time
55
what is cost plus pricing?
when a firm adds a mark up percentage to cover the cost of production per unit
56
what is predatory pricing?
when a business sets a deliberately low price to force other businesses out the market
57
what is competitive pricing?
when businesses monitor their competitors prices to make sure that their own prices are set the same or lower
58
what is psychological pricing?
bases the price on customers expectations. e.g. £9.99
59
what is a distribution channel
moves a product through the stages from production to consumption
60
what is direct distribution/selling
manufacturer to consumer
61
indirect distribution/ selling
- manufacturer to retailer to consumer
- manufacturer to wholesaler to retailer to consumer
62
what is multichannel distribution
involves a business using more than one type of distribution channel
63
a benefit and drawback from multichannel distribution
- allows more market segments to be reached
- complex to manage
- potential from "channel conflict", competing with retailers by also selling direct
64
example of online distribution
downloading media content or streaming- no tangible good
