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business studies > 1.3 - the marketing mix and strategy > Flashcards

1.3 - the marketing mix and strategy Flashcards

1
Q

design mix

A
  • function
  • cost
  • aesthetics
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2
Q

function

A
  • focuses on what the product does, regardless of looks and price
  • examples = parachute, phone charger, vaccine
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3
Q

cost

A
  • focuses on being as cheap as possible
  • lower cost = competitive advantage
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4
Q

aesthetics

A

focuses on looking good, function and cost come after

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5
Q

changes in the elements of the design mix to reflect social trends

A
  • resource depletion
  • designing for waste minimisation
  • re-use and recycling
  • ethical sourcing
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6
Q

benefits of adapting product designs to changes in social trends

A
  • reduced waste = using less resources
  • products are likely to be more popular and sell larger quantities
  • can be used as a USP
  • viewed as good corporate citizens
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7
Q

marketing

A

a means of promoting a business and what it offers

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8
Q

principles of marketing

A
  • identifying needs
  • promoting products or services/ contributing to brand development/ promoting the brand
  • pricing of the brand
  • promoting the brand by various means
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9
Q

branding

A

identification of a product or service which is instantly recognisable with no explanation

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10
Q

advantages of branding

A
  • adds value to the product
  • business can charge premium prices
  • reduces elasticity of demand
  • enables the business to reduce the amount of time spent on promotion
  • customers are more likely to repurchase
  • easier to persuade retailers to put products in their stores
  • other products can also be promoted
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11
Q

rebranding

A

occurs when a business decides to change a significant element of its identity

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12
Q

promotion

A

process of communicating with customers

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13
Q

main objectives of promotion

A
  • inform
  • benefit
  • persuade
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14
Q

types of promotion

A
  • sales promotion
  • public relations
  • merchandising and packaging
  • direct marketing
  • exhibition and trade fairs
  • digital marketing
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15
Q

factors to consider when selecting promotion

A
  • type of product
  • size of the market
  • cost
  • competition
  • marketing constraints
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16
Q

distribution

A

the process of getting the right product or service to the consumer in the right place
- one of the four p’s of marketing (place)

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17
Q

stage four distribution

A

manufacturer - wholesaler - retailer - consumer

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18
Q

stage three distribution

A

manufacturer - retailer - consumer

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19
Q

stage two distribution

A

manufacturer - consumer

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20
Q

choice of the channel depends on

A
  • nature of the product
  • market
  • nature of the business
  • size of the business
21
Q

factors that affect distribution

A
  • online shopping
  • shopping malls
  • call centers
22
Q

online distribution

A
  • niche products reach a wider audience
  • cater to any place
  • transactions happen solely online
23
Q

advantages to consumers of online distribution

A
  • cheaper, lower costs
  • consumers can shop 24/7
  • more choice
  • can shop from anywhere if the internet is accessible
24
Q

disadvantages to consumers of online distribution

A
  • not able to physically look at goods before purchase
  • potential for poor after-sales service
  • exclusion of customers without internet or cards
  • difficulty in taking delivery of the goods
25
Q

advantages to businesses of online distribution

A
  • avoid costs of physical stores
  • lower start-up costs
  • lower costs when processing transactions
  • less paper needed for documents
  • payments made and received online
  • can offer goods to a wider market
  • can serve customers 24/7
  • more choices regarding location
26
Q

disadvantages to businesses of online distribution

A
  • increased competition domestically & internationally
  • lack of human contact
  • heavy reliance on delivery services
  • technical problems can occur
  • security concerns surrounding sensitive information
27
Q

marketing tools

A
  • boston matrix
  • product life style
28
Q

product life cycle

A

describes the stages a product goes through from when it was first thought of until it finally is removed from the market

29
Q

stages of the product life cycle

A
  • research & development
  • introduction
  • growth
  • maturity
  • decline
30
Q

extension strategies

A
  • ways to prolong the life of a product before it starts to decline
  • usually employed in the maturity stage
  • can generate more profit and revenue
31
Q

types of extension strategy

A
  • advertising
  • price reduction
  • adding value
  • explore new markets
  • new packaging
32
Q

boston matrix

A

a model that helps businesses analyse their portfolio of businesses and brands
- used in marketing and strategy

33
Q

boston matrix categories

A
  • stars = high growth, high market share
  • cash cows = low growth, high market share
  • question marks = high growth, low market share
  • dogs = low growth, low market share
34
Q

product portfolio

A

shows how a business decides to allocate investment across the portfolio

35
Q

outbound strategies

A
  • traditional method of marketing
  • attracts potential business customers
    -costly with low return on sales
  • examples = direct mail, e-mail, cold calling
36
Q

inbound strategies

A
  • attracting potential business customers to websites
  • requires considerable effort and resources
  • examples = blogging, social media marketing, search engine optimisation
37
Q

ways businesses can develop customer loyalty

A
  • communication
  • customer service
  • customer incentive
  • personalisation
  • preferential treatment
38
Q

cost plus pricing

A
  • price where a mark-up has been added to the unit cost of producing the good/service
  • mark-up is a % added to the unit cost
  • makes sure all costs are covered
  • very common strategy
39
Q

drawbacks of cost plus pricing

A
  • ignores market decisions
  • difficult to identify all costs associated with production
40
Q

price skimming

A
  • price is set high in the first instance and then lowered later
  • aim is to generate high levels of revenue and cover expensive development costs
41
Q

advantages of price skimming

A
  • can be used when PED is inelastic
  • maximises revenue
  • recover development costs
  • lower price draws consumers in
42
Q

disadvantages of price skimming

A
  • only used with inelastic demand
  • attracts other businesses to the market
43
Q

penetration pricing

A
  • setting a low price when launching the product to become established
  • aim is to get a foothold in the market
  • can be done by offering the product at a cheap rate for a time period or provide and introductory offer
44
Q

advantages of penetration pricing

A
  • useful when products targeted at middle-low income consumer groups
  • grows sales of a new product quickly
  • can create economies of scale
  • puts pressure on rivals
45
Q

disadvantages of penetration pricing

A
  • can’t let the offer last too long
46
Q

predatory pricing

A
  • setting a low price that forces rivals out of business
  • some forms are illegal in the UK & EU
47
Q

competitive pricing

A
  • setting a price based on what rival businesses are charging
  • a business looks at what rivals are charging before setting its own price
  • market leader may set the price and others follow
48
Q

psychological pricing

A

-setting a price that is slightly below a round figure
- consumers think the product is cheaper
- targets consumers looking for bargains

49
Q

factors that determine the most appropriate pricing strategy

A
  • costs and the need to make a profit
  • stage in product life cycle
  • strength of brand
  • level of competition in the business environment
  • price elasticity of demand

business studies (16 decks)

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