2. Extended Marketing Mix Flashcards
what is the marketing mix?
the tools available to a business to gain the reaction it is seeking from its target market in relation to its marketing objectives
what are the 7 p’s of the the marketing mix?
price
product
promotion
place
people
process
physical environment
what must a product be?
-must meet the needs of the customers
-must provide benefit to the customer
-may be a good or service
-may vary in quality, style, price, packaging from competitors
what are brands?
distinguishing name or symbol, such as a logo, that identifies the products or services offered by a seller and differentiates those products from those offered by competitors
what is the value of brands to retailers?
-attract customers
-build loyalty
-higher prices leading to higher profit
-reduced promotional expenses
-facilitates entry into new markets
what is the value of brands to customers?
-promises consistent quality
-simplifies the buying process
-reduces time and effort searching for information about merchandise/retailer
what are the advantages of brand?
-ensures products are easily identified by consumers
-create brand loyalty and customers will repeatedly purchase the product
-purchase their product and not a rivals
-launch new products more easily
higher prices can be charged
what are the disadvantages of brand?
-customers can be put off by the higher price
-competitors can mimic your product to increase their own sales
-can be costly process to create the brand/logo/slogans
-can mean very high marketing costs in the early stages of the product/brand life cycle
-high and low quality brands can be sold by an individual retailer to give customers a choice
what are the disadvantages of brand?
-customers can be put off by the higher price
-competitors can mimic your product to increase their own sales
-can be costly process to create the brand/logo/slogans
-can mean very high marketing costs in the early stages of the product/brand life cycle
-high and low quality brands can be sold by an individual retailer to give customers a choice
what are the stages of the product life cycle?
-development
-introduction
-growth
-maturity
-saturation
-decline
what are some product life extension strategies?
-improve product
-changing the packaging
-change the channel of distribution
-change the product price
-change the promotional activities
-change the use customers have for the product
-rebrand the name
-variations on the original
what are the advantages of a product portfolio?
-a wide range of products can allow the business to meet the needs of a variety of customers
-increased profits and profits levels remain steady
-makes business easier to manage
-profitable products can support the development and launch of new products
-raises the profile of the business
-can lead to the company becoming market leaders
-risk is spread amongst products
what are the disadvantages of product portfolio?
-products can be spread too wide
-business can lose focus on its key objectives
what is price dependent on?
-companies objectives
-competitors prices
-position in its life cycle
-cost of manufacturing
-time of year
-level of advertising /promotions
-suppliers prices
what is penetration pricing?
price initially set lower to enter an existing market then raise price once popular
what is destroyer pricing?
priced lowered then raised once the competition has left the market
what is promotional pricing?
prices reduced for a short period of time
what is premium pricing?
high price charged and maintained to create an exclusive image for the product
what is price discrimination?
changing different prices for the same product at different times of day, year or amount of usage
what does the channel of distribution depend on?
-the product being sold
-finance available to the organisation
-reliability of companies the chain
-desired image of the product
-government restrictions
-the products life cycle
-manufacturer’s distribution capability
what are the types of direct selling?
mail order
interent
direct mail
newspapers/ magazines
personal selling (door-to-door, telesales)
why do manufacturers sell to retailers?
-they are often located close to customers
-they may offer credit facilities, delivery, after-sales service and guarantees to customers
-they already have an established customer base
-they will incur the costs of storage of stock, retail premises and sales staff
what are the different types of retailers?
independent store
supermarket
chain store
department store
discount store
what are the advantages of retailers?
-provide a source of market research
-often locate close to the customer
-provide after sales service
-may offer credit facilities
-may have an established customer base
incurs the cost of storage, sales staff and retail premises
-bulk buying discount
what are the disadvantages of retailers?
-may not have specialist product knowledge
-lack of control on how the product/service is sold or displayed
-product is more expensive to but for the consumer due to the ‘middle man’
what is a wholesaler?
a wholesaler buys goods in bulk direct from the manufacturer and then sells in smaller quantities to retailers and other businesses.
what are the advantages of wholesalers?
-it provides a source of market research
-it saves the manufacturer from making many small deliveries to individual retailers, therefore3 saving on transport, admin, sales rep costs
-it saves the manufacturer from high stick holdings/storage costs
what are the disadvantages to wholesalers?
-not all manufacturers decide to use wholesalers some decided to keep control over the way their product is presented to retailers and customers
-wholesalers have limited specialist knowledge
what factors influence the location of business premises?
-how far the location is from the customer
-how far the location is from infrastructure
-the price of land or premises in the area
-whether or not there are car parking facilities for employees and customers
-cost of labour in the area
what are the two types of promotion?
below the line
above the line
what is below the line promotion?
directly controlled by the business eg internet selling, direct mail
what is above the line promotion?
makes use of mass media to allow the organisation to reach a larger audience eg TV , radio
what are the advantages of TV?
-adverts can be targeted to national audience reaching all market segments
-product made appealing by the colour, sound and movement of the advert
-product can be demonstrated
-regular adverts can maintain a high profile
what are the disadvantages of TV?
-expensive
-product may not need to reach all market segments
-message can be short-lived
-many viewers channel surf during adverts
what are the advantages of magazines?
-big colour adverts, more impact
-can target market segments
-magazines often kept for future reference
what are the disadvantages of magazines?
can be expensive
what are the advantages of independent radio?
-cheaper than TV
-can have a captive audience as no surfing during adverts
-target particular market segments
what are the disadvantages of independent radio?
-listeners may not pay attention to adverts
-limited to sound only
-reliant on listeners imagination to be successful
what are the advantages of internet?
-can be relatively cheap
-adverts can target particular market segments if placed on the website
-adverts can be changed easily
what are the disadvantages of internet?
-web surfers may ignore adverts
-software available to stop pop-ups if this style is used
what are the disadvantages of internet?
-web surfers may ignore adverts
-software available to stop pop-ups if this style is used
what are the advantages of apps?
-can use it on the move
-can often use free wifi to access the internet
what are the disadvantages of apps?
-customers need to buy a smart phone or tablet computer to use which is expensive
-training is needed so the app can be designed for customer easier to use
-internet connection depends on the location and devise being used
what are the advantages of celebrity endorsement?
-consumers buy the product in an attempt to be the same as the celebrity
-photographs of the celebrities are used to create visual connections to the product
-higher prices can be charged due to endorsement
-brand loyalty may be created due to the endorsement
-statements can be used in promotions to further enhance the the product
what are the disadvantages of celebrity endorsements?
-can cost vast amounts of money to retain the celebrity
-if the celebrity gains bad publicity the product is also tarnished
-product endorsement does not guarantee a quality product
what are people to an organisation?
people are an essential part of a business whether it be the customers or the employees
what are people to an organisation?
people are an essential part of a business whether it be the customers or the employees
what is the physical element of a business?
clean facilities
point of sales displays
logo
payment systems
uniform
seating areas
free wireless
a relaxing ambiance
access to an organisation website
what is the process of a business?
looks at how a service is provided, from the minute an order is taken to being delivered
