1.4.3 The Marketing Mix

Question 1

What is the marketing mix?

Answer 1

the marketing mix deals with the way in which a business uses price, product, distribution and promotion to market and place of sale in order to be successful

Question 2

What are the elements of the marketing mix?

Answer 2

• product
• price
• place
• promotion

Question 3

Marketing mix - product:

Answer 3

the product/service the customer is obtaining

Question 4

Marketing mix - price:

Answer 4

how much the customer pays for the product/service

Question 5

Marketing mix - place:

Answer 5

how the product/service is distributed to the customer

Question 6

Marketing mix - promotion:

Answer 6

how the customer is found and persuaded to buy the product

Question 7

What makes for an effective marketing mix?

Answer 7

• meets customer needs
• achieves marketing objectives
• is balanced and consistent
• creates a competitive advantage for the business

Question 8

How are marketing mixes different?

Answer 8

• the marketing mix for each business and industry will vary; it will also vary over time
• for most businesses, one or two elements of the mix will be seen as relatively more important than the others

Question 9

Price examples of emphasis on elements of the marketing mix:

Answer 9

• discount supermarkets
• low-cost airline

Question 10

Promotion examples of emphasis on elements of the marketing mix:

Answer 10

• soap powders
• furniture retailers

Question 11

Product examples of emphasis on elements of the marketing mix:

Answer 11

• luxury motor vehicles
• tailor-made holidays

Question 12

Place examples of emphasis on elements of the marketing mix:

Answer 12

• convenience stores
• coffee shops

Question 13

How do the elements of the marketing mix work together?

Answer 13

• each ingredient affects the other and the mix must overall be suitable to the target customer, e.g.
  
  • high quality materials used in a product may mean that a higher selling price can be achieved
  • a low quality product will not be bought if a high price is attached to it
  • a new or improved product needs promotion if potential customers are to be aware of it
  • an advertising campaign carried in one area of the country requires distribution of the product to be in place in advance of the campaign to ensure there are nod disappointed customers
  • promotion is needed to emphasise the new features and benefits of a product
• the marketing mix needs to be balanced based on the competitive environment
• in most cases, failure to address any one of the marketing mix elements appropriately will lead to the failure of the product/service

Question 14

How can businesses reach a stage where they have no competition?

Answer 14

• All businesses will be trying to reach a situation where they have no competition
• This can be achieved in different ways, for example a business may be the only firm operating in a small area or it may be the only business that is allowed to produce a product because it has a patent or copyright
• Having minimal competition may be beneficial or disadvantageous - it will however, affect a firm’s marketing mix

Question 15

Impact of no competition on marketing mix:

Answer 15

• Product - as the business will achieve high sales, there would be little incentive to develop new or improved product; quality therefore may suffer
• Price - prices can be set high, resulting in high profit
• Promotion - once customers are aware of the business, then there may be less need to spend on promotion
• Place - place might be fixed through the location of the business, but access to the firm’s products may be chosen more to suit the convenience of the business rather than the customer

Question 16

Impact of competition on marketing mix:

Answer 16

• Product - constant development of existing products and the development of new products will be necessary; quality and customer service will be very important, as having a USP will be essential to successfully compete and survive in the market
• Price - price reductions may take place in order for the firm to remain competitive against rival businesses. As a result, profits may decrease
• Promotion - increase in promotion and advertising to attract new customers and keep existing customers coming back to the business
• Place - greater focus on the customer’s requirements, which might increase distribution or opening costs

Question 17

How will the marketing mix of a business change?

Answer 17

• Marketing will change as the needs of consumers change
• Not only will the goods and services that are demanded change, but so will the way customers find out about products, as well as how they make their purchases
• Consumer trends will affect all elements of the marketing mix; the type of products that are produced (more technology), price (more competitive), promotion (social media) and place (e-commerce)

Question 18

Recent consumer trends:

Answer 18

• Increase in online shopping
• Use of smart phones and apps
• More health conscious consumers
• Increased use of price comparison sites and product reviews
• Widening use of social media
• Credit spending increasing
• Brexit influencing purchasing decisions

Question 19

Digital technology:

Answer 19

• where businesses use computer based tools, systems, devices and resources to generate, store or process data
• it has many aspects including social media, online multimedia, productivity applications,cloud computing, e-commerce and communication

Question 20

E-commerce:

Answer 20

• the buying and selling of goods and services using the internet
• the more recent development is m-commerce, which is using wireless handheld (mobile) devices, such as smart phones

Question 21

How can small business take advantage of the benefits of digital technology?

Answer 21

Taking advantage of the benefits of digital technology are all possible for small businesses, but all have costs, initial and ongoing, in terms of keeping the technology requirements up to date

Question 22

How may a business have to adapt its marketing mix so it continues to meet changing consumer needs?

Answer 22

• changing features of a product to incorporate new trends and tech
• adjusting the price of its products in response to competitors’ pricing
• launching a new advertising campaign to boost interest in response to falling sails
• selling its products through popular retailers
• allowing customers to return online products free of charge

Question 23

Impact of technology on product:

Answer 23

• new technology demands that products are constantly innovated, especially in tech industries that produce items such as computers and smartphones
• digital technology has led to a whole range of products, such as smartphones, tablets, and smart TVs, being developed
• technology has increased product quality and allowed new customer experiences e.g. 3D films

Question 24

Impact of technology on price:

Answer 24

• technology has decreased prices through reduced costs of production
• it has also increased competition through e-commerce and international competition
• this competition has been increased through price comparison sites - businesses have to monitor rivals to remain competitive

Question 25

Impact of technology on promotion:

Answer 25

• advertising now makes significant use of websites, social media and increasingly is personalised at the individual user
• customer databases allow targeted promotions and can be linked to purchases made

Question 26

Impact of technology on place:

Answer 26

• e-commerce allows customers to access many products from anywhere in the world
• shopping online is a 24/7 experience —> this has led to declines in physical retail outlets for many goods and services