1.3.5 Marketing Strategies Flashcards
1
Q
Definition of market strategy
A
Methods to achieve marketing objectives.
2
Q
What are the 5 stages of the Product Life Cycle?
A
- Development
- Introduction
- Growth
- Maturity
- Decline
3
Q
Development phase
A
- design and market research
- expensive
- high risk as product might not be successful
4
Q
Introduction phase
A
- high costs in R&D
- low sales as customers are unaware of the product
- advertising
5
Q
Growth phase
A
- rapid growth in sales and profit
- demand is high as customers are aware
- advertise to take advantage of high demand
6
Q
Maturity phase
A
- intense competition
- market starts to be saturated
- high sales but profits start to fall
- products have to be discounted to maintain high sales
7
Q
Decline phase
A
- limited in production
- profits and sales decrease
8
Q
Ways to extend the lifecycle of a product?
A
- Update packaging
- Add features
- Change target audience
- Advertising
- Price reduction
9
Q
Definition of product portfolio
A
Collection of all products/services offered by a company
10
Q
What are the 4 parts of the Boston Matrix?
A
- Stars
- Cash cows
- Question marks
- Dogs
11
Q
Characteristics of star products
A
- High market growth and relatively high market share.
- Likely to be profitable, but business needs to invest to cope with growing market and sales.
- Net cash flow will be nearly 0 because investment spending leads to outflows.
12
Q
Characteristics of cash cows
A
- High market share but in a low growth market.
- Likely to be profitable, but there’s a low chance of increasing sales.
- Strong net cash flow.
13
Q
Characteristics of question marks
A
- Low market share but in a high growth market.
- Problem for the business as it’s unclear what should be done with the product.
- Won’t be profitable.
14
Q
Characteristics of dogs
A
- Low market share and in low growth market.
- Require no investment as they’re in decline phase
- May become obsolete or replaced
- Business may discontinue/withdraw product
15
Q
Uses of the Boston Matrix
A
• to manage their product portfolios
