1.3 Marketing mix and strategy Flashcards
What does the design mix consist of
- Aesthetic
- Cost
- Function
What do each element of the design mix mean
Aesthetic- refers to the style and appearance of a product. About making it desirable
Function- refers to the benefits that a product or service provides. Includes how well a product meets a need.
Cost- Encapsulates all production costs of a product. Specifically cost per unit
How can products be designed to meet social trends
Products now in society are environmentally conscious which demands products that are sustainable
These could be:
- products designed for waste minimisation
- Products designed for re-use
- Products designed to be recycled
- Products sourced ethically (fair trade)
The drawbacks of product design (design mix)
Adapting any one of the elements of the design mix can have a detrimental impact on the other two. For example, reducing costs could mean poorer functionality or aesthetic look of the product
The benefits of adapting products to social trends
- reducing waste helps businesses cut costs
- Producing products align with social trends means they are more likely to sell large quantities
- Social trends can be used as a USP to differentiate products
- More likely seen with good CSR
Define above the line promotion
involves any form of advertising through the media such as:
-television
- radio
- billboards
- internet
- direct marketing (emails)
- newspapers
- cinema
Define below the line promotion
Includes all other forms of promotion that are not advertising like:
- sales promotion (free gift, coupon)
- public relations (press conference)
- merchandising and packaging
- personal selling
What is the impact of successful promotion
Can create awareness, understanding and a desire for the product
What are the influences on promotion
Target audience- a business must choose the right method and channel to reach the right people
Technology- helps a business narrow down its promotion to reach right people
The message- different messages may suit different types of promotion E.g public apology on website compared to new product launch on social media
Promotion budget- will determine which methods are available to the business
What is the purpose of an advert
- To inform customers
- Persuade customers to buy
- Remind customers about products
- Reassure customers
Define Brand
represents the characteristics and personality of a business
What are 4 ways to build a brand
- exploiting a USP
- advertising
- sponsorship
- using social media
What is the importance of branding
- adds value to the product
- builds trust
- allows a premium price to be charged
- makes a product recognisable
- helps a business position itself in the market
What are the 3 types of brands
- manufacturers brands- e.g. kellogg’s
- own-label brands- e.g. Sainsbury’s crisps
- generic brands-e.g. carrots (don’t have a brand association)
How can businesses use social trends to build their brands
- social media, can attract followers
- viral marketing, sharing of images and videos can build brand awareness
- emotional branding, associating their brands with things that consumers have strong emotional connections to. E.g. Sports teams
What can influence price
Costs
elements of the marketing mix- 7p’s must complement each other
branding- may add value
product life cycle- the stage it is in
competition
the price elasticity of demand
What are the 7 pricing strategies
dynamic pricing
penetration pricing
cost plus pricing
price skimming
predatory pricing
psychological pricing
competitive pricing
Define dynamic pricing
applied to products that price can fluctuate with the level of demand
E.g. hotel rooms
Define penetration pricing
applied to a new product attempting to enter the market
Initial price is low to undercut competitors
over time price may increase as demand grows
Define predatory pricing
Where the business sets a low price in order to price competitors out of the market
The business may make a loss for a period of time until the competitor fails to
Define competitive pricing
The business sets prices based on the nearest competitor
This helps avoid price wars
Define psychological pricing
The business bases the price below the next whole number to trick consumers into thinking that the price is lower
E.g £9.99 instead of £10
Define price skimming
The business sets an initial high price for a new product when it is in high demand. The price will then fall overtime
Define cost-plus pricing
A business bases a price on the unit cost and then adds a percentage as a mark-up.
This strategy is effective as it considers the profit margin the business is willing to accept
