3.3 Marketing

Question 1

Marketing Objectives

Answer 1

-Marketing objectives are likely to be informed by research and potentially constrained by budgets

-They will be used to select the marketing strategy and develop a marketing plan.

-Marketing objectives may focus on:
-Sales volume and value
-Market size
-Market and sales growth
-Market share
-Brand loyalty

Question 2

Internal influences on marketing objectives

Answer 2

-Finance
-Marketing budget
-Cash flow targets
-Timing and quantity of sales
-Return on investment targets
-Revenue is generated through
marketing activities
-HR
-Will marketing activities lead to more
customers?
-Are staff trained to respond to
marketing activities?
-Keeping staff informed
-Operational issues
-Ability to meet demand
-Little point in generating
increased demand if stock is not
available
-Implementation of marketing
decisions
-Ability to physically produce a
new or changed product
-Logistics of a new market
-Distribution and stock issues
-Corporate objectives
-Always the driving force behind
other functional objectives.

Question 3

External influences on marketing objectives

Answer 3

-Competitors’ actions
-Marketing budget
-Promotional activities
-Pricing policies
-Product development
-Aggressive marketing

-Market factors
-Degree and relative power of
competitors
-Social factors
-Legislation
-Demographics

-Technological change
-E-commerce
-Digital marketing
-Social media
-Global markets
-Production capabilities

-Ethical and environmental influences
-Consumers’ expectations
-Pressure groups

Question 4

What is market research?

Answer 4

Market research is the collection and analysis of data and information to inform a business about its market.

Primary market research (field research) involves the collection of first hand data that did not exist before and therefore it is original data

Secondary market research (desk research) is research that has already been undertaken by another organisation and therefore already exists.

Question 5

Examples of primary research?

Answer 5

-Surveys and questionnaires
-Postal
-Telephone
-Face-To-Face
-On-Line

-In depth interviews

-Focus groups

-Observations

Question 6

Examples of secondary research?

Answer 6

-National and local government e.g office for National statistics

-Market research organisations e.g MORI, MINTEL

-Professional bodies e.g ACCA

-Trade unions and confederation of British industry (CBI)

-International bodies e.g EU, OECD

-Academic organisations e.g universities

-Newspapers and magazines

-The Internet

Question 7

What is qualitative research?

Answer 7

-Qualitative research is the gathering of non statistical information that gives a company in depth insight into the reasons for human behaviour.

Question 8

What is quantitative research?

Answer 8

-Quantitative research is the gathering of statistical data to inform the company about people’s behaviour but does not indenting the reasons.

Question 9

Value of sampling?

Answer 9

-Businesses cannot ask for the opinions of all potential customers and therefore try to chose a representative sample

-A sample is a group of subjects that has been chosen from a larger group, the population, for investigation.

-The value of sampling will depend upon:
-The sample technique used
-How the sample was carried out
-The size of the sample

-The size of a sample will depend upon a number of factors including:
-The budget available
-The importance of accuracy
-Degree of confidence in results

Question 10

What is random sampling?

Answer 10

-When a sample is selected for study from a population where each individual is chosen entirely by chance and has an equal chance of being selected.

Question 11

What is quota sampling?

Answer 11

-The population is first segmented into subgroups before a judgement is made in selecting respondents that are representative of that subgroup.
-e.g within a subgroup of women
60% may be aged 20-40, 20% 41-60,
20% 61+

Question 12

What is stratified sampling?

Answer 12

-The population is first segmented into subgroups before respondents are randomly selected from within that subgroup.
-e.g within a subgroup of 16-18 yr
olds any member has an equal
chance of being selected

Question 13

Define price elasticity of demand?

Answer 13

-Price elasticity of demand is a measure of how responsive demand is in response to change in price.

Question 14

What does the value of Price elasticity of demand mean?

Answer 14

-If PED is between 0 and -1 the demand is inelastic

-If PED is less than -1 the demand is elastic

Question 15

Factors influencing PED

Answer 15

-The availability of substitutes
The closer the substitutes and the
more that are available the higher the
price elasticity of demand
-The price of competitiors goods
If the price of goods in competition
with a product increase this will affect
demand and price elasticity of
demand.
-Time
The longer the time period the higher
the price elasticity of demand. Given
more time the other firms have the
ability to produce similar products
and customer have more chance of
adapting their buying habits
-Branding
Firms spend time and money building
up their brand image. By creating
brand loyalty firms know that their
customers will be willing to pay more
for the product and they can
therefore raise price as the PED is
lower
-Income
If consumer incomes are higher then
the issue of price becomes less
important to the consumer and it is
easier for firms to raise price as the
PED is lower
-Nature of the good
-A luxury good will be price elastic as
demand will be more sensitive to
changes in price
-A necessity good will be price
inelastic as demand will be less
sensitive to changes in price

Question 16

Problems of forecasting price elasticity of demand.

Answer 16

-The price elasticity of demand for a product is constantly changing in a dynamic world.
-It is very difficult for firms to measure because:
-Difficulty in finding accurate
information
-Price elasticity changed over different
price ranges
-Price elasticity will change over the
period of the economic cycle e.g it will
be affected in a recession
-Tastes and fashions are constantly
changing
-Competitors don’t stand still
-They are continually improving
existing products, bringing out
new products and trying to
promote their products.

Question 17

Define income elasticity of demand (YED)

Answer 17

The measure of responsiveness of demand to a change in income.

Question 18

What does the value of income elasticity of demand mean?

Answer 18

-Income elasticity of demand can be negative or positive I.e:
-When demand for a product
increases when incomes increase
we call this a normal good
-Normal goods will always have a
positive income elasticity of
demand I.e, a + sign
-When demand for a product
decreases when incomes increase
we call this and inferior good
-Inferior goods will always have a
negative income elasticity of
demand I.e a - sign

0<+1 income inelastic, demand changes at a lower proportion than the change in income

<-1 or >+1 income elastic, demand changes at a higher proportion than the change in income

Necessities are products that have a positive YED that is between 0 and 1

Luxuries are products that have a positive YED that is greater than 1

Question 19

3 steps of market segmentation

Answer 19

-Step 1: Segment the market into groups of customers with similar characteristics

-Step 2: Decide on what segment of the market to target

-Step 3: Position the product on the market by identifying how it will be viewed in relation to its competitors.

Question 20

Market segmentation

Answer 20

-Market segmentation occurs when the market is split into subgroups of consumers with similar characteristics

-This helps to identify different types of consumer and different wants and needs.

-Segmentation methods include:
-Demographic
-Geographic
-Income
-Behavioural

Question 21

Demographic Segmentation

Answer 21

-Identifies subgroups of the population based on their demographic profile or characteristics
-Age
-Gender
-Level of education
-Race
-Religion
-Family size
-Stage in life e.g empty nesters

-Demographics looks at the social and economic characteristics of individuals and households.

Question 22

Geographic Segmentation

Answer 22

-Geographic segmentation defines market categories based on where people live. E.g regions, cities, neighbourhoods.

-People in different geographical areas display different characteristics and needs e.g
-The south east of England is
generally warmer than Scotland
-Tastes and traditions vary between
countries
-Infrastructure in rural areas will
differ from that of cities

Question 23

Income segmentation

Answer 23

-Identifying subgroups of the market based on their levels of income and profession

-A common method uses socio-economic groupings
-A- Higher managerial such as chief
executives and directors
-B- Intermediate managerial such as
solicitors, accountants and doctors.
-C1- Supervisory, Clerical or junior
professional such as teachers and
junior managers.
-C2- Skilled manual such as plumbers,
electricians and carpenters.
-D- Semi and unskilled workers such as
refuse collectors and window
cleaners.
-E- Pensioners, causal workers,
students and unemployed

Question 24

Behavioural Segmentation

Answer 24

-Characterises subgroups based on the behavioural patterns of the consumer rather than their characteristics:
-Reasons for making purchases e.g
needs, emotional, rewards.
-Frequency of purchase e.g, heavy
user or light user
-Time of purchase e.g seasonal,
weekly, late at night
-Brand loyalty
-Method of purchase e.g online
-Triggers e.g response to digital
marketing

Question 25

Benefits of market segmentation

Answer 25

-There are a number of benefits for a firm that uses market segmentation as part of its market research.
-Advertising can be targeted at specific
market segments so that advertising
spend is more effective
-The most profitable and least
profitable customers can be
identified
-Least profitable markets can be
avoided
-It becomes easier to identify new
products
-It helps firms improve existing
products and customer service.

Question 26

Targeting

Answer 26

-Targeting is the process of deciding which segment of the market to focus on

-This will be influenced by:
-Mission and objectives
-Perceived level of demand
-Degree of competition
-Nature of the product
-Understanding of the needs and
wants of a specific segment

-Targeting may include niche and mass marketing.
-Niche marketing is when a firm
targets a small subsection or
previously unexploited gap in a larger
market.
-Niche marketing may give a
business first mover advantage
and allow them to charge premium
price.
-Mass marketing is when a firm
targets a whole of a market rather
than a particular segment
-Mass marketing can give a
business a high volume of sales
but often at a lower price.

Question 27

Positioning

Answer 27

-Where a product is placed in the market relative to its competitors

-Positioning can be achieved by changing elements of the marketing mix to meet the needs of the target market.

-Influences on positioning include:
-Internal constraints e.g budgets
-Internal strengths e.g creativity and
innovation
-Market conditions e.g degree of
competition
-External environment e.g state of the
economy.

Question 28

The marketing mix (7ps)

Answer 28

-The marketing mix is the combination of elements through which a firm achieves its marketing objectives

-Product
-Promotion
-Price
-Place
-People
-Process
-Physical environment

Question 29

The marketing mix(product)

Answer 29

-Product is the goods and services that a firm provides.
-Product will be made up of core features and functions as well as additional aspects that can sway consumer behaviour e.g brand or guarantees.
-Goods are physical or tangible
products e.g a car or tv
-Services are non physical or
intangible e.g financial consultancy
or teaching.
-Businesses will normally have a range of products in their portfolio.

Question 30

The marketing mix(Promotion)

Answer 30

-Promotion is the activities designed to communicate with the market thereby increasing visibility and sales of a product.

-Firms use different promotional strategies to make their products more widely known to other businesses and the general public e.g branding, advertising, Sponsorship

Question 31

The marketing mix(Price)

Answer 31

-Price is the amount of money that the customer has to pay to receive the good or service

-Firms use different pricing strategies to price their products, taking into account a number of factors such as market research, competitors’ prices and the state of the economy

-Price can also be changed as part of a promotional campaign.

-Pricing decisions include:
-Penetration pricing
-Price skimming
-Dynamic pricing

Question 32

The marketing mix(Place)

Answer 32

-Place defines both the physical location where a product is available as well as the distribution channel it has traveled through to get from the manufacturer to the customer.

-Place can be a physical market where buyers and sellers meet face to face or a virtual location i.e over the internet

-Increasingly firms are adopting a multi channel approach to place.

Question 33

The marketing mix(People, Process and physical environment)

Answer 33

-People are the employees involved in dealing with customers before, during and after a sale.

-Process is the steps a customer goes through to actually complete a transaction.

-Physical environment is the design and features of the actual place where a transaction takes place.

Question 34

Influences on marketing mix(The market)

Answer 34

-There are a number of factors that might influence the marketing mix for a firm:
-Industrial markets are where
businesses are selling to other
businesses(B2B)
-The technical specification of
the product and service provided
by as sales person or account
manager is likely to be more
important than the physical
environment.
-Consumer markets are where
businesses are selling to the
public(B2C
-The product and the price may be
seen as of equal importance to
the physical environment but
more important than place e.g
does it matter what channels the
product went through to reach
the consumer

Question 35

Influences on the marketing mix(The nature of consumer market)

Answer 35

-There are a number of factors that might influence the marketing mix for a firm:
-Convenience products are ones
where the ease with which a
consumer can get the product is a
key priority.
-Likely to be everyday items
such as bread and potatoes
-Customers may pay a higher
price as a result of the
convenience e.g if buying from
a corner shop to save travelling
time
-Shopping products are ones where
the consumer does not rush into
the purchase but compares
different options weighing up the
strengths and weaknesses of each
option before reaching a decision.
-Often items that have an
element of emotional
attachment when buying and
sometimes irrational behaviour
e.g gifts or fashion
-Customers may be influenced
more by the product and the
physical environment than the
price
-Specialty products are ones that a
customer will spend time thinking
about and often researching before
buying.
-These are likely to be
infrequent purchases where
the product is viewed as a
luxury or a treat e.g an
expensive item of jewellery or a
designer label.

Question 36

Influences on the marketing mix

Answer 36

-Market research findings will inform elements of the marketing mix.

-Target market that the product is aimed at

-Positioning relative to competitiors

-Internal constraints e.g budgets, expertise, and capacity

-External influences including the actions of competitors and the state of the economy.

-The marketing mix of a business is dynamic I.e it changed over time. As the influences change the business will have to respond by changing elements of the mix.

Question 37

What is product portfolio analysis?

Answer 37

-Product portfolio analysis looks at the range of products and brands that a firm has under its control.

-A businesses product range is called it’s products portfolio.

-This type of analysis can help a firm identify where every single one of its products is positioned in the market.

Question 38

What is the Boston matrix?

Answer 38

-One technique used to analyse a business’ product portfolio is the Boston matrix.

-This considers each product within the portfolio in relation to its market share and the rate of market growth.

-The matrix consists of 4 quadrants:
-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 39

What is a cash cow?

Answer 39

-High market share in a low growth market.

-These are established products
-The products made through these products can be used to finance other products such as rising stars
-Firms will want to establish as many cash cows as possible.
-With low market growth there is likely to be less competition from new firms entering the market, therefore firms can spend less on advertising
-A product is called a cash cow because a firm can “milk” the product to finance other areas of the business.

Question 40

What is a rising star?

Answer 40

-High market share in a high growth market

-These products enjoy increasing sales revenue
-However, because the market is growing other firms are entering the market with similar products, therefore there will be fierce competition between these firms.
-There is usually heavy promotional spending and increased capital investment in order to increase capacity.
-Cash flow can often be negative at first
-Rising are often funded from cash cows
-It is hoped that a star can go on to become a cash cow but many stars eventually will become dogs.

Question 41

What is a problem child?

Answer 41

-Low Market share in a high market

-With growth in the market a product can be very successful if there is enough demand.
-However, some products are unsuccessful and the firm will have to decide whether to persevere with the product or discontinue it.
-A Problem Child or question mark, will require a lot of attention, particularly in the form of marketing.
-Nurturing the problem child to help it achieve its potential will cost the firm time and money.
-If sales of the product can be increased there is the opportunity for increased profits in the future and the product can be turned into a cash cow.

Question 42

What is a dog?

Answer 42

-Low market share in a low growth market

-Dogs are unlikely to be kept on by a company
-With little growth in the market and little market share the company might see little scope for future profits.
-This does not always mean that the company will discontinue the product, if there is a market, then some products can still be profitable.
-However, when a firm looks at its range of products it is more likely to concentrate on cash cows and rising stars rather than dogs.

Question 43

Product life cycle

Answer 43

-Product life cycle is a technique used to track the stages a product goes through during its life

-It tracks sales over time from the development stage of a product through launch and until it is removed from the market.

-Although a product life cycle relates to just one product business will want to have products at different stages

-For example the revenue from a product that has reached maturity could be used to help develop a new product.

Question 44

6 stages of Product life cycle

Answer 44

1. Development- Negative cash flow due to market research and Research and Development (R&D). No sales revenue before launch
2. Introduction- Production and promotion costs can be high
3. Growth- Sales revenue increased but as more units are sold production costs also increase. However, there will be economies of scale
4. Maturity- Sales stabilise and the product acts as a cash cow
5. Decline- at some point the product will start to lose sales.
6. Extension strategies- many products are adapted and given a new lease of life.

Question 45

New product development (NPD)

Answer 45

-NPD is the process of bringing a new product or service to the market. The process involves:

1. Generating ideas through different methods e.g brainstorming
2. Screening the ideas to come up with a specific idea
3. Development and testing of the concept
4. Analysis of costs, sales forecasts and likely profits.
5. Market testing of the concept
6. Product launch

Question 46

Influences on new product development (Technology)

Answer 46

-Advances in technology have seen incredible changes in a range of industries in the past 30 years. The internet and mobile phones have made communications and the exchange of information quick, easy and cheap. Robotics, new stock control systems and the micro chip have revolutionised manufacturing

-New technology has:
-Brought economies of scale to
businesses
-Made the world a global market
through communications systems
-Seen the rapid development of both
new and innovative products

Question 47

Influences on new product development (Competitor’s actions)

Answer 47

-Firms are now faced with increasingly competitive markets. Not only are uk firms competing against each other but they are now also competing against firms from all over the globe.

-Firms keeps a close eye on competitors’ actions and either respond to moves by their competitors or they try to be proactive and bring out new products before their Competitors do.

Question 48

Influences on new product development (Management)

Answer 48

• The entrepreneurial skills of managers and owners
• The managers and owners of business are vitally important if the firm is to develop a range of new ideas and products. It is the owners and managers that will:
• Be able to see the opportunities for new products that might arise within their markets.
• Provide the funding that will be required for firms if they are to have resources that are required in order to develop the new products
• Provide the inspiration and motivation for other members of the organisation so that all staff are engaged in the process of identifying new ideas that might lead to new products.

Question 49

Penetration pricing

Answer 49

-Price penetration involves setting a low initial price for a new product in order to get a foothold in the market and gain market share.

-May be a suitable pricing strategy for a product in a mass market

-A firm will release a new product at a low price with the aim of enticing people to buy

-The aim is to gain an early customer base

-Once the product has been launched and built up a customer base the firm may raise the price

-Likely to be used with a price elastic product.

Question 50

Price skimming

Answer 50

-Price skimming involves setting a high initial price for a new product in order to recoup costs

-When a firm releases a new product it often charges a high price targeting a segment of the market known as “early adopters”
-These are customers who must have
the product as soon as it is launched
and are prepared to pay high prices
to get it.

-Firms often base their initial promotional campaign around this idea, trying to creat a “must have” mentality amongst their target market

-Once this market has been “skimmed off” the company lower price.

Question 51

Dynamic pricing

Answer 51

-Prices change frequently and quickly in response to change in demand.

-At times of peak demand prices will go up and vice versa.

-Often used by businesses with set capacity e.g an airline so as the plane reaches full capacity prices will start to rise.

-Dynamic pricing is made possible by technology that tracks demand and levels of interest.

Question 52

Elements of promotional mix

Answer 52

-ProMotion- The component of the marketing mix that informs and persuades customers about the product in order to sell that product. ProMotion is designed to create Awareness, Interest, Desire and Action (AIDA)

-Promotional Mix- The combination of promotional activities that a firm uses in order to create consumer awareness and generate sales.
A Firm will look at its promotional mix in order to increase the sales of its products.

-Branding

-Merchandising

-Sales Promotion

-Direct Selling

-Advertising

-Public Relations

Question 53

Promotional decisions

Answer 53

-Promotional decisions are influenced by a number of factors including:
-The segmentation, targeting and
positioning process.
-Will the message appeal to the
target market?
-Does the promotion support the
rest of the marketing mix and
correctly position the product
relative to competitiors
-Internal constraints e.g the size of
the promotional budget or the firms
ethical objectives
-External influences
-Technology
-Competitors’ actions
-Environmental issues

Question 54

Branding

Answer 54

-A Promotional method that involves the creation of an identity for the business that distinguishes that firm and its products from other firms

-Branding can add value to a product allowing firms to charge higher prices

-Ultimately leads to brand loyalty whereby customers will continue to buy products from that firm.

-Organisations spend enormous amounts of time and money branding their company and products

Question 55

Relationship marketing

Answer 55

-Relationship marketing focuses on building a longer term relationship with valued customers rather than focussing on short term sales

-Builds brand loyalty

-Encourages an emotional attachment to the brand

-The business may benefit in the long run by word of mouth promotions

-In industry markets this is often developed when an accounts manager is responsible for key clients who they build a bond with

Question 56

Promotional Methods

Answer 56

-Public relations (PR) involves communicating with the media such as newspapers, television and radio in order to get favourable publicity for the organisation.

-Merchandising is the way in which a firm promotes its product at Point of Sale (POS). Plenty of thought I’d put into the visual display of a product and the way that the product is presented within the selling location.

-Sales Promotions are short term offers used by firms in order to increase sales for their products.

-Advertising occurs when firms pay for the promotion of their product through the main media such as television, radio and the press. This is known as ‘above the line, ProMotion.

Question 57

Technology

Answer 57

Developments in technology are affecting the promotional activities of business, this includes:
-Social media
-The use of virtual communities to
communicate with actual and
potential customers
-Viral Marketing
-Use of social media to encourage
the spread of promotional
activities and increase brand
awareness
-Uses blogs and online forums

Question 58

The marketing mix (Place)

Answer 58

-Place defines both the physical location where a product is available as well as the distribution channel it has travelled through to get from the manufacturer to the customer.

-Place can be a physical market where buyers and sellers meet face to face or a virtual location. I.e over the internet.

-Increasingly firms are adopting a multi-channel approach to place

Question 59

Distribution

Answer 59

-Place is the term given to distribution.
-Distribution is the process of getting the firms product to the market.
-Distribution channels are the routes to market that a product takes from producers to final customer
-There are a number of distribution channels available to firms:
-Short distribution channels are
where the producer sells either
directly to the customer or through a
retailer.
-Long distribution channels are where
there are more than one
intermediary (middle person)
between the producer and the
customer.

Question 60

Types of distribution channels

Answer 60

-Producers can use direct selling whereby they sell directly to the final consumer

-Often, producers use retailers who sell products on to the general public

-Wholesalers buy large quantities of supplies from producers and sell them on in smaller quantities. For example, a corner shop might go to a wholesaler to buy their products

-Increasingly, firms are using e-commerce benefiting from the power of the internet to sell on their products.

-Multi-channel distribution is when a firm chooses to use a combination of methods.

Question 61

Traditional distribution channels.

Answer 61

-Traditional (long)
1. Manufacturer
2.Wholesaler
3.Retailer
4.Consumer

Question 62

Modern distribution channels

Answer 62

-Modern (medium length)
1.Manufacturer
2.Retailer
3.Consumer

Question 63

Direct distribution channels

Answer 63

-Direct(Short)
1.Manufacturer
2.Consumer

Question 64

Distribution decsions

Answer 64

-Distribution decisions will be affected by a number of factors including:
-Type of product
-The characteristics of the product
need to be taken into account. For
example Coca Cola do not ship
their product to the uk from USA.
Instead they ship over the syrup
and the actual product is then
made in the uk using British water.
-Market
-It is important that the customers
being targeted can access the
product. High streets are
accessible by public transport so
that all customers can shop, not
just those with cars.
-Is the businesses targeting a local,
National or global market?
-Quantity and frequency
-If only a few low cost items are
being delivered it would not be
cost effective to send them
hundreds of miles. If a product is
regularly being delivered then a
firm might invest in a delivery
system.
-Geographical location
-How far is the target market from
the firm? The firm will have to take
into account the nearness of the
market. Regional markets are far
more accessible than international
markets.
-Cost
-This is very important for a firm.
An expensive distribution method
will reduce the contribution being
made to a firm’s profit. Therefore,
the firm must ensure that the
method is cost effective.
-Degree of control
-Businesses may want to protect
their brand by limiting the spread
of the product and keeping tight
control of where it is available and
at what price.
-

Question 65

The marketing mix (People)

Answer 65

-People are the employees involved in dealing with customers before, during and after sale.
-Customer service is extremely important in today’s service sector in the UK
-Staff must be appropriately trained, motivated and show good communication skills when dealing with customers.
-People are an important aspect of all business, they are the ones interacting with the customer.

-The role of people in the marketing mix will include:
-Providing information
-Supporting the customer in decision
making.
-Resolving problems
-Completing the transaction

Question 66

The marketing mix (Process)

Answer 66

-Process is the steps a customer goes through to actually complete a transaction
-The ease with which a transaction takes place will directly impact on customer’s perceptions of the business.
-This can include:
-The ease with which a product can
be paid for e.g credit card
transactions.
-The effort involved e.g how many
clicks when buying online.
-The length of queues or number of
people you have to transact with.

Question 67

The marketing mix(Physical environment)

Answer 67

-Physical environment is the design and features of the actual place where a transaction takes place.
-This can directly influence the customers’ shopping experience and therefore their level of satisfaction as well as willingness to return.
-Aspects of physical environment include
-Cleanliness
-Design e.g ease of movement
around the premises or ability to
find what you are looking for
-Facilities
-Ambience

Question 68

An integrated marketing mix

Answer 68

-An integrated marketing mix marketing mix means that the individual elements complement each other to communicate a coherent message to the public.
-This is important in order to:
-Give a clear message to the target
market
-Position the product effectively
-Protect and promote the brand
promise
-Achieve marketing objective

Question 69

Factors influencing an integrated marketing mix

Answer 69

-An integrated marketing mix will be influenced by:
-The position in the product life cycle
-A new product may be promoted
heavily using both informative and
persuasive techniques.
-A product that has just reached
maturity and facing decline may
lower prices.
-An extension strategy may see the
product redesigned to freshen its
appearance.
-The Boston matrix
-Changes may be made to the
marketing mix of a problem child to
help it become a star e.g change to
the product or the way it’s
promoted.
-The type of product
-A specialist product will have a
physical environment that matches
the quality of the product and is
likely to have a premium price tag.
-Marketing objectives
-A business with an objective of
increasing market share may alter
its mix in order to try and achieve
this. For example lowering price,
depending upon the PED or bringing
out and improved product.
-The target market
-Place may reflect geographic
segmentation or the choice of
media reflect the income of the
customer e.g if the target market is
socio-economic group A the
business may choose to advertise in
a broadsheet.
-Competition
-May need to respond to
competitors’ actions for example if
they lower price or increase
promotional spend a business may
wish to follow suit.
-Positioning
-Adapting the marketing mix to
maintain the businesses position
and brand perception relative to
competitors.

Question 70

Digital marketing and E-Commerce

Answer 70

-Digital marketing is the use of any form of digital technology to improve communications with customers.

-Examples include:
-Search engine optimisation(SEO)
-Social media
-Viral marketing
-Digital display boards
-SMS messages
-Targeted feeds
-Online advertising

-E-commerce is when buyers and sellers meet to trade in a virtual market place e.g on the internet.

-The value of digital marketing and e-commerce include:
-Access to a global market
-24/7 exposure and convenience
-Greater analytics leading to more
detailed data to inform decisions
and target customers
-Improved customer relations and
understanding of buying habits
-Greater two way communication
-Greater word of mouth publicity
through blogs and review sites