1.3 - Marketing Mix and Strategy Flashcards
Marketing mix
Provides a framework for businesses to create and implement successful marketing strategies
4 P’s
Product, Place, Price and Promotion
Design mix
Combination of function, aesthetics and cost
Aesthetics
How a product looks/feels.
Value proposition
A simple statement of why customers should choose your product.
Types of promotion
Digital communications, sponsorship, advertising, direct marketing, sales promotions.
Branding
The process of creating a unique and identifiable name, design, logo that differentiates a company from its competitors.
3 types of branding
Own brand product
Product branding
Manufacturer/corporate branding.
Manufacturing/corporate branding
Use of company name or logo to promote all the products or services offered by the company.
Product branding
Use of unique name, design or symbol to promote a specific product.
Own brand product
Use of retailers name to promote a specific product or service,
e.g. Tescos finest.
Benefits of branding
Added value, ability to charge premium prices, reduced PED.
Cost plus pricing
Calculate cost of produced then add a markup to determine final price.
Markup covers cost of production plus the businesses desired profit margin.
Unit cost + (mark up % x unit cost)
Price skimming
Sets a high price for a new product/service when it is first introduced to the market, helps to recover development and marketing costs quickly.
Price will gradually be lowered to ensure sales continue.
Price Penetration
Sets a low price for a new product/service when it is first introduced.
To quickly capture market share and attract price-sensitive customers.
Once enough customers they start to raise the price.
Predatory pricing
Sets a price so low that it drives competitors out of the market.
Harms customers by reducing choice in the market.
Competitive pricing
Sets price based on its competitors prices.
Effective to maintain market share in a highly competitive market.
Must continually monitor prices and adjust to remain competitive.
Psychological pricing
Takes into account customers emotions, beliefs and attitudes towards product, e.g $9.99.
3 factors affecting price
number of USP’s, PED, level of competition, strength of brand, stage in life cycle.
Distribution channels
The various intermediaries through which goods/services move from the manufacturer to the end customer.
4 stage distribution
Producer, wholesaler, retailer, consumer.
Three stage distribution
Producer, retailer, consumer
Two stage distribution
Producer, consumer.
Product life cycle
The different stages a product goes through in its life.
5 stages in the product life cycle
Development, introduction, growth, maturity, decline.
Market share
The percentage of the total market revenue that a business has.
Market growth rate
How quickly the market as a whole is growing.
Boston matrix
Used to analyse their product portfolio and make strategic decisions about each product.
Boston matrix diagram
Mass market
Large numbers of customers who have similar needs and wants.
Niche market
Smaller groups of customers with specific needs and wants.
Business to business (B2B) marketing
focuses on selling products to other businesses. How your product can help them be more successful.
Business to consumer (B2C) marketing
focuses on selling products/services directly to consumers.
Emphasis on building brand loyalty and a positive customer experience.
Three ways to improve customer loyalty
Customer service, loyalty cards and saver schemes.
