Question 1

What are the three factors of the Design Mix?

Accepted Answer

- Function - Cost - Appearance/Aesthetics

Question 2

What is Product design?

Accepted Answer

the process of creating a new product or service

Question 3

What is the importance of the Function of the product?

Accepted Answer

- A product must be fit for purpose --> durability, offer long warranties to show that they have confidence - Products should easy and convenient to use --> technical products, designed so maintenance can be carried out - Ergonomically designed --> safely using product without using unnecessary effort - if a business can design a product of service with superior functionality could be its USP - Safe products/services is also key

Question 4

What is the importance of Aesthetics of a product?

Accepted Answer

- Products and services should provide a sensory stimulation in addition to performing a function - - size, shape , appearance, sell or taste etc - sometimes use more expensive material for looks - someone may buy luxury cars for aesthetics that fuel economy - Many consumers prefer smaller and more portable products that are more user-friendly

Question 5

What is the importance of the Cost of a product?

Accepted Answer

- A well-designed products or service is likely is more likely to economically viable (they can make a profit) - Therefore designers will need to select materials and processes that minimize costs - In the airline industry, new routes must be cost-effective if they are to be introduced. Businesses often to reach of compromise between design and cost

Question 6

How is the design mix and social trends?

Accepted Answer

- People have become increasingly aware about the effect their lifestyles have on the environment - Businesses have also responded to pressure from the government, media and consumer groups by taking into account environmental issues in the design of their product Design for waste minimization --> last longer, smaller and lighter, recyclable products, less packaging -Some industries are more difficult to change e.g. fashion changes every season

Question 7

What is promotion?

Accepted Answer

-the publicising of a product, service or business to draw attention to it to generate sales and obtain and retain customers

Question 8

What is Above the line Promotion?

Accepted Answer

- involves advertising in the media - Informative advertising - Persuasive advertising - Reassuring adveritisng

Question 9

What is informative advertising?

Accepted Answer

- adverts are designed to increase consumer awareness of products, give information about the features of a product

Question 10

What is persuasive advertising?

Accepted Answer

- Some advertising is designed to put pressure on consumers to buy a product. - Persuasive advertisements often try to convince consumers to buy a particular brand rather than that of a competitors

Question 11

What is Reassuring advertising?

Accepted Answer

- This advertising is aimed at existing customers - it is designed to be comforting and suggest to consumer that they were 'right' to buy and particular product and that they should continue to do so

Question 12

What is Below the line promotion?

Accepted Answer

-advertising that doesnt use media

Question 13

What are some examples of Below the line promotion?

Accepted Answer

- Sales promotions --> free gifts, coupons, loyalty cards, competition, BOGOF, money-off deals - Public relations --> Press releases, press conferences, sponsorship, donations - Merchandising and packaging --> product layout, display material, stocked shelves - direct mailing and selling - Exhibition and trade fairs

Question 14

What factors are considered when choosing methods of promotions?

Accepted Answer

- Cost - Market type (local business in Yellow Pages) - Product type (Some products are more suitable for TV advertising) - Stage (Product Life Cycle) - Competitors promotions - Legal factors

Question 15

What is branding?

Accepted Answer

The process involved in creating a unique name and image for a product in the consumers' mind, mainly through advertising campaigns with a consistent theme. Branding aims to establish a significant and differentiated presence in the market that attracts and retains loyal customers.

Question 16

What are some Types of Branding?

Accepted Answer

- Manufacturer brands --> brands created by the producer of goods, or services - Own-label distributor or private labels --> products that manufactured for wholesalers or retailers by other business - Generic brands --> products that only contain the name of the product category rather than the company or product e.g. aspirin, carrots

Question 17

What are the benefits of strong branding?

Accepted Answer

- Added Value - Ability to charge a premium price - Reduced price elasticity of demand

Question 18

What are different ways to build a brand?

Accepted Answer

- Exploit USP - Advertising - Sponsorship - Using social media --> turning like into customers is a problem

Question 19

How has branding and promotion changes to reflect social trends?

Accepted Answer

- viral marketing - social media - emotional branding

Question 20

What are types of pricing strategy?

Accepted Answer

- Cost plus - Price skimming - Penetration pricing - Predatory pricing - Competitive pricing - Psychological pricing

Question 21

What is Cost plus?

Accepted Answer

- Calculating mark-up a unit costs) - adding a percentage (the mark-up) to the cost of producing a product to get the price - Mark-up--> the percentage added to unit cost that makes profit for a business when setting the price

Question 22

What is Price Skimming?

Accepted Answer

- technology (usually) - setting a high price initially and then lowering it later

Question 23

What is Penetration Pricing?

Accepted Answer

-setting a low price when launching a new product in order to get establishing in the market

Question 24

What is Predatory pricing?

Accepted Answer

- setting a low price forcing rivals out of business (can be illegal)

Question 25

What is Competitive pricing?

Accepted Answer

- pricing strategies based on the prices changed by rivals

Question 26

What is Psychological pricing?

Accepted Answer

- setting a price slightly below a round figure

Question 27

What are the factors affecting Pricing Strategies?

Accepted Answer

- amount of USP/Differentiation --> price skimming, get as much revenue as possible with a strong USP - PED --> Price takers -->elastic- the price the market set and Price leaders -->inelastic --> unique products or lead brands - you can set the price - Amount of competition - Strength of brand - Costs and the need to make a profit - Stage in the product life cycle

Question 28

What changes in pricing are to reflect social trends?

Accepted Answer

``` Online Sales -Dynamic pricing - used to maximise revenue, ut can change e.g. last minute offers -Auction sites -Personalized pricing -Subscription pricing Price Comparison Sites ```

Question 29

What is Distribution?

Accepted Answer

The movement of goods and services from the source through a distribution channel, right up to the final customer, consumer, or user, and the movement of payment in the opposite direction, right up to the original producer or supplier.

Question 30

What are Distribution channels?

Accepted Answer

A distribution channel is a chain of businesses or intermediaries through which a good or service passes until it reaches the end consumer. It can include wholesalers, retailers, distributors and even the internet itself.

Question 31

What are some examples of Distribution channels?

Accepted Answer

- Consumers - retailer--> consumers - Wholesalers --> retailers--> consumers - agents/brokers --> wholesaler--> retailers --> consumers

Question 32

What are intermediaries?

Accepted Answer

who acts as a mediator on a link between parties (customers/consumers) to a business deal, investment decision or negotiation - links between producers and consumers

Question 33

What is Direct Selling?

Accepted Answer

-Selling directly to consumers

Question 34

What are benefits of direct selling?

Accepted Answer

- main benefits is saves intermediary costs - you can reach those who dont want to go to shops, but people dont like a lot of directing selling

Question 35

What are some examples of direct selling?

Accepted Answer

- The internet - Direct mailing - a lot of financial service do - Door-to-door selling e.g. energy suppliers - Mail order catalogues e.g. Next - Direct response adverts - adverts in newspapers people respond to e.g. plumber - Shopping parties e.g. Avon - Telephone shopping - legal service e.g. PPI

Brainscape's Knowledge GenomeTM

1.3 Marketing risk and Strategy Flashcards

Brainscape's Knowledge Genome^TM