1.3.5 Marketing Strategy

Question 1

What is a product

Answer 1

Is the good and services that the firm provides

Question 2

What are goods

Answer 2

Physical or tangible products

Question 3

What are services

Answer 3

Non physical or intangible

Question 4

What is product portfolio analysis

Answer 4

Looks at the range of products and brands that a firm has under its control

Question 5

What is a product portfolio

Answer 5

A business product range

Question 6

Product portfolio analysis can help a firm …?

Answer 6

Identify where every single one of its products is positioned in the market

Question 7

What is the product life cycle

Answer 7

Is a technique used to track the stage a product goes through firings its life

It tracks sales over time from the development stage through launch and until it is removed from the market

Question 8

What are the 6 stages in the product life cycle

Answer 8

Development 
Introduction 
Growth
Maturity 
Decline
Extension

Question 9

Describe development

Answer 9

Negative cash flow due to market research and research development. No sales revenue before launch .

Question 10

Describe introduction

Answer 10

Production and promotion costs can be high

Question 11

Describe growth

Answer 11

Sales revenue increases but as more units are sold production costs also increase. However there will be economies of sales

Question 12

Describe maturity

Answer 12

Sales stabilise and the product acts as a cash cow

Question 13

Describe decline

Answer 13

At some point the product will start to lose sales

Question 14

Describe extension

Answer 14

Many products are adapted and given a new lease of life

This can be done by changing product eg flavours

Increase promotion

Question 15

What is one technique used to analyse a business product portfolio

Answer 15

Boston matrix

Question 16

What are the 4 quadrants that that matrix consists of

Answer 16

• high market share , low market growth
• high market share , high market growth
• low market share, high market growth
• low market share , low market growth

Question 17

What are the 4 types is categories given to the matrix

Answer 17

Cash cow
Rising star
Problem child
Dog

Question 18

Describe a cash cow

Answer 18

• high market share , low market growth
• these are established products
• profit made from these can be used to finance other products e.g. Rising star
• firms want to establish many cash cows
• with low market growth there is less likely to be competition , therefore less advertising needed
• firm can milk the business for finance

Question 19

Describe dogs

Answer 19

• low market share , low market growth
• unlikely to be kept on by a company
• but doesn’t mean it will be discontinued
• more likely to concentrate on rising stars and cash cows

Question 20

Describe rising stars

Answer 20

-high market share, high growing market
-increasing sales revenue
-growing market so other firms entering the market with similar products
-heavy promotional spending
Cash flow can be negative at first
-Often funded by cash cow
-can become a cash cow but can become dogs

Question 21

Describe a problem child

Answer 21

• low market share , high market growth
• with growth in market a product can be successful if there’s enough demand
• unsuccessful products , they have to decide wether to Persue or discontinue
• require a lot of attention
• can be turned into cash cow

Question 22

What are the 4 types of markets

Answer 22

Niche
Mass
Consumer
Industrial

Question 23

Describe niche markets

Answer 23

Is when a firm targets a small subsection or previously unexploited gap in a large market

Allows them to charge premium prices

Question 24

Describe mass marketing

Answer 24

Is when a firm targets the whole of a market rather than a particular segment

Can give high volume sales but at low prices

Question 25

Describe industrial markets

Answer 25

Are where businesses are selling to other businesses

The technical specification of a product and service provided by a sales person or account manager is likely to be more important than the brand

Question 26

Describe consumer markets

Answer 26

Are where businesses are selling to the public

The product and the price may be seen as equal importance to the promotion but more important than price

Question 27

what are the 3 ways that you can understand consumer behaviour and customer loyalty

Answer 27

Customer service
Loyalty schemes
Physical environment

Question 28

Describe customer service

Answer 28

People are the employees involved in dealing with customers before during and after a sales

• staff must be appropriately trained , motivated and show good communication skills when dealing with customers
• people are important as they are interacting with the customers s

Question 29

What are two loyalty schemes

Answer 29

Reward schemes

Saved schemes

Question 30

Describe physical environment

And aspects

Answer 30

• design and features is actual place where transaction happens
• this can directly influence the customers shopping experience and levels of satisfaction as well as willingness to return
• cleanliness
• design and movement around premises, ability to find what your looking for
• facilities
• ambience