3.3 Decision making to improve marketing performance Flashcards
Name 4 types of marketing objectives.
- Sales volume and sales value
- Market and sales growth
- Market share
- Brand loyalty/image
Give examples of internal and external influences on marketing objectives and decisions.
Internal:
- Finance
- Operations
- Human Resources
External:
- Political
- Economic
- Social
- Competitors
Advantages of Primary Market research?
- Specific to the needs of the business
- Up to date + reliable
- Better for collecting Qualitative data (via 2 way communication)
Disadvantages of primary market research?
- More time consuming
- Costly
- Difficult to conduct large sample size
Advantages of secondary market research?
- Easily accesible
- Fast + less time consuming
- Better for collecting quantitative data
Disadvantages of secondary market research?
- Not always specific to business needs
- May be outdated
- Detailed reports are expensive to purchase
What is market mapping?
A technique used to understand how products/businesses are viewd relative to competitors based on two variables. E.g. Modern+Old, Mass market/ Niche market.
Example:
Pros ans Cons of market mapping?
Pros:
- Helps business identify gaps in the market
- Gain understanding of competition
Cons:
- Only considers two variables
How do you calculate Market Share?
(Total company sales ÷ Total market share) x 100
How do you calculate Market and Sales growth?
(Increase in market size/sales (the diff.) ÷ Original size/sales) x 100
What is market size?
Expressed in terms of units sold or value (£)
What are the advantages of sampling?
- Quicker + easier than trying to collect data from entire population
- Bigger sample size = more representative
- Cheaper
Draw an example for each type of correlation and suggest their correlation value.
- +0.9
- -0.8
- 0
What are confidence levels and confidence intervals?
- Confidence level: An indication of how accurate the research findings are.
- Confidence Interval: The possible range of outcomes for given confidence. As the confidence narrows, the confidence level will fall.
What is extrapolation?
Predicting future trends and is reliable when conditions stay the same.
What is the value of technology in gathering + analysing data for marketing decision making?
- Technology = faster collection of market research data + specific to customers
- Can help identify correlations, trends + patterns
E.g. Boots loyalty cards
What is price elasticity of demand and what is the PED scale?
Price elasticity of demand = the effect of a change in price on quantity demanded.
PED scale:
3 1 0
(elastic) (inelastic)
What is income elasticity of demand?
Income elasticity is the effect of a change in consumer income on the quantity demanded.
What are the methods of segmentation?
- Behavioural = E.g. consumer habits + brand loyalty
- Income = how much people earn
- Geographic = location
- Demographic = e.g. age, gender.
What can a business use to help them position themself in the market?
Market mapping
What is the scale of segmentation in a market?
What are the 7 P’s?
- Product: goods/services
- Price: matches product
- Place: channel distribution
- Process: transaction
- Promotion: awareness
- People: customer service
- Physical environment: layout
What is the value of new product development?
All products must have a balance of design, function and cost.
E.g. improving design = decreased quality
Draw a product life cycle. What are the stages?
Pros and cons of product portfolio analysis?
Pros:
- Useful for making decisions on where funds are allocated
- Predict future sales, plan production + distribution
Cons:
- Products/markets don’t usually follow a pattern
- No clear solutions provided
- Simplifies complex issues
Draw a Boston Matrix model.
What is price skimming?
Setting a high initial price then lowering the price when the product is no longer new.
What is penetration pricing?
Initial low price in order to penetrate market and undercut competitors. Over time, price increases as demand grows.
What is dynamic pricing?
Applied to products where price fluctuates with level of demand. E.g. hotel rooms.
List some promotional methods.
- Advertising - (e.g. above the line = mass ads)
- Sales promotions - (special offers)
- Sponsorship - (paid association)
- Social media - (facebook, instagram)
- Public relations (PR: media attention e.g. a blog)
- Direct marketing - (communication with customer)
What is the importance of branding?
- Adds value to product
- Builds trust
- Premium price charged
- Helps business position itself
- Makes product recognisable
List the different possible channels of distribution.
What is the importance of digital marketing/ e-commerce?
- Allows small business to reach global audience
- Business can gather customer info easily
- Easier to target specific segments
