1.3 Marketing mix and Strategy Flashcards
Pros of using a design mix
- Balanced product appeal
- Competitive advantage
Cons of using design mix
- focusing too much on one can have impact on others
Pros of Above-the-line promotion
- Wide audience reach
- Increased Brand credibility (trustworthy)
Cons of Above-the-line Promotion
-High costs
- less specialised
pros of Below-the-line promotion
-Highly targeted
- Cost-effective
Cons of Below-the-line promotion
limited reach
Time consuming eg direct sales
Pros of strong branding
- Adds value to product
- builds trust
What is penetration pricing
Initial low price in order to penetrate market then may increase as demand grows
pros and cons of penetration pricing
Attracts customers quickly ✅
Lower profit margins ❌
price skimming definition
initial high price that lowers over time
pro and con of price skimming
- maximises early profits ✅
- Limited customer base (have to have strong brand) ❌
Dynamic pricing defintion
price can fluctuate with level of demand
Pro and Con of dynamic pricing
maximises revenue ✅
customer dissatisfaction ❌
Predatory pricing pro and con
-setting low price to force competition out of market
✅-eliminates Competition
❌-Legal/ethical risks
competitive pricing Pro and Con
-sets price based on nearest competitor
✅-market relevance
❌-lower profit margins
Psychological pricing Pro and Con
basing price below next whole number eg £9.99
✅encourages purchases
❌doesn’t work on all consumers
Cost-plus pricing pro and con
base the price on unit cost + adds % as a mark-up
✅-ensures profitability
❌-ignores market demand
Pros of online distribution for businesses
- Lower start-up costs
- 24/7 operation
- much wider market
Pros of online distribution for consumers
- Can shop 24/7
- compare brands easily
- wider choice
- See reviews of products
pros of using Product portfolio analysis (PPA)
- Useful analysis tool for business with a wide range
- making decisions about fund allocation
- used to predict future sales
Cons of using Product portfolio Analysis (PPA)
-Products are complicated (don’t follow pattern)
- no clear solution
- simplifies a complex issue
Ways of improving customer loyalty
- Customer incentives eg vouchers
- customer service
- treatment for returning customers
