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January Business Mock > 1.3.5 Marketing strategy > Flashcards

1.3.5 Marketing strategy Flashcards

1
Q

Product life cycle:

A
  • lifespan of a products sales
  • launch to off the market
  • sales and cashflow
  • y-axis = sales
  • x-axis = time

price: skimming (recoup R&D) or penetration in intro, discounts in decline
product: core product launch = need extension strategy (ES)

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2
Q

5 stages of product life cycle

A
  1. R&D
  2. Launch
  3. Growth
  4. Maturity
  5. Decline
  6. Extension strategy
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3
Q

Why is product life cycle important?

4 positives

A
  1. decision making
  2. visual/interpret
  3. flexible, different time spans
  4. stage influences marketing mix/plan
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4
Q

negatives of product life cycle

A
  • considered overly simplistic

- products may not always follow model (rapid growth into decline)

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5
Q

extension strategy:

7 ways

A

modifies product = appeal = maintain sales in maturity
increase sales, differentiated =less risk, appeal new segment

ways:
1-moderate product/flavour
2-packaging/rebranding 
3-use
4-size 
5-image 
6-advert campaign 
7-name
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6
Q

product portfolio

A

-range of products that a business sells

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7
Q

market growth:

A

total a market has either increased or decreased based upon either value or volume

year 2 -year 1 divided by year 1 x100

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8
Q

market share:

A

proportion of total market sales that a firm has

sales of 1 firm divided by total market sales x100

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9
Q

boston matrix

A

-tool to analyse a product’s market share and growth within a market

high MG high MS: rising star
high MG low MS: problem child
low MG high MS: cash cow
low MG low MS: dog

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10
Q

adv and dis of having a wide product portfolio:

A

adv:

  • revenue streams
  • risk
  • customer loyalty through portfolio

dis:
- opportunity cost
- harder to manage
- single product = damage brand

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11
Q

rising star

A 
holding 
PROMOTION 
-high sales revenue 
-lots of investment/promotion 
-fierce competition 
-be in growth face of product life cycle
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12
Q

cash cow

A

milking

  • high sales revenue
  • not much investment/promotion needed
  • less threat from competition/new entrants (established)
  • reaching maturity of product life cycle (still customer loyalty)
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13
Q

problem child:

A

building e.g. advertise, diff, R&D MR

  • increased investment/promotion (R&D)
  • low sales revenue
  • fierce competition (low demand)
  • just launched, building customer loyalty
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14
Q

dog:

A

sell off/divest

  • low in investment and sales revenue
  • extension strategy
  • poor profits
  • get rid of/improve them
  • in decline phase of product life cycle
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15
Q

4 Adv of boston matrix

A

1-simplistic/easy
2-where brands/products are within market
3-aid decision making
4-right time to launch/withdraw products

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16
Q

5 dis of boston matrix

A

1-subjective
2-overly simplistic
3-only 4 categories
4-current market share info = difficult future prospects
5-costs aren’t considered high MS not = high profit

17
Q

even distribution through matrix

A

business is developing new products at right time

18
Q

type of product lifecycle extension strategy

A
  1. product:
    - ensure remain in maturity stage rather than decline/withdrawn
    - less risky than new product
    - builds on customer loyalty
    - less expensive than developing new product
  2. promotion
    - re-packaging
    - discounts
    - rebranding
    - new markets
    - more frequent use
19
Q

mass market

A
  • market for goods/products produced in large quantities
  • all consumers regardless of age/gender etc
  • customers = majority in market, needs/wants = general
  • higher production output & capacity EOS
  • success associated with low cost operations, heavy promotion and widespread distribution or marketing leading brands
  • ignores market segment, product standardised
  • appeal to larges portion of market = most sales
  • lower price EOS
  • advertising TV, national, inshore promotion
20
Q

niche market

A
  • highly differentiated, specialist promotional strategy
  • targets smaller segment of a larger market, customers = specific needs/wants
  • less competition, clear focus for brand, build specific skills/knowledge charge higher price, profit margins higher loyal customers
  • lack of economies of scale, risk of dependant on 1 product/market, attract competition if successful, vunerable to changes in the markets
  • advertise specifically people through mail, Emil, person 2 person (promotion), charge higher premium price, tailored to specific segment by aesthetics/functionality
  • full page magazine advertising, improve customer service
21
Q

business to consumer

A
  • short messages clearly pointing out benefits
  • variety distribution chain = convenience
  • technological brands/retailers e.g. amazon
  • maintain good relationships with customers = return back (loyal)
  • marketing strategy has to fit in with marketing objs
  • emotional connection with product or supplier e.g John Lewis the bear and the hare
22
Q

business to business

A
  • companies sell products/services to other businesses
  • dont buy with emotion
  • transactions often on order/invoice system
  • larger scale orders (invoices)
  • relationships between supplier and customer
  • few buyers, involve larger transactions
  • price cost saving focus
  • quality serve
  • informative advertising rather than ‘persuasive/clever’
  • process of selling products/services to business buyers for use in their companies e.g Costco
23
Q

customer loyalty

A

-a preference for a product or brand based on experience and or an emotional attachment, which inclines buyers to repeat purchase away from rivals

  • loyalty cards and saver schemes are methods of attracting customer loyalty
  • selling more to existing buyers is easier and cheaper than finding new ones = saves on promotional costs
24
Q

loyalty cards

A
  • e.g. Tesco club cards
  • focused on incentivising purchases by rewarding spending e.g. every pound at Tesco = club card point
  • 44%of companies have a greater focus on customer acquisition vs 18% focus on retention
  • costs 5x as much to attract a new customer than to keep an existing one
25
Q

why is there low or negative cash flow originally

A

high R&D
low sales
high promotion

26
Q

how can a business understand consumer behaviour

A

MR: questionnaires, interviews, focus group, observations (footfall)
analyse loyalty data
segmentation and consumer profiles

27
Q

customer loyalty

A

preference

experience and or emotional attachment = repeat purchase not rivals

28
Q

how can a business influence consumer behaviour and build loyalty?

A
  1. branding
  2. message/slogan
  3. ethical stance
  4. adapt/localise product
  5. promotions/ads
  6. loyalty/reward scheme
  7. customer service (added value)
  8. market research (market orientation)
  9. social proof (social media) word of mouth

January Business Mock (15 decks)

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