3.3.4 Using the marketing mix Flashcards
1
Q
10 what is the marketing mix
A
a specific collection of actions and associated instruments employed by an organisation to stimulate acceptance of its ideas, products and services.
2
Q
10 what is the 4 stages of a firm off to a customers
A
1 firm chooses product to meet identified need of target segment
2 distribution channel is selected to make product available
3 firm undertakes eye catching promo
4 price platform is accepted by all
3
Q
10 what are the 7 Ps in the Marketing Mix
A
price
product
promotion
place
people
process
physical environment
4
Q
10 what is product (learn)
A
a tangible object or service that is mass produced or manufactured on a large scale with a specific volume of units
5
Q
10 what is examples of product features
A
variety
quality
design
features
brand name
packaging
services
6
Q
10 what is place
A
the location a product can be purchased in
often distribution channel, include any physical store, as well as online
7
Q
10 what is an example of place
A
channels
coverage
locations
inventory
transportation
logistics
8
Q
10 what is a channel
A
the way you go to market, shops direct or online, as well as wholesalers, retail etc
9
Q
10 what is price
A
amount the customer pays
determined by market share, competition, material costs, and customer value
business can increase or decrease price
10
Q
10 what is examples of pricing
A
list price
discounts
allowances
payment periods
credit terms
11
Q
10 what is promotion
A
all communications used
advertising, personal selling, public relations, word of mouth, point of sale
lots of crossovers
12
Q
10 what is advertising
A
communication that is paid for, cinema, radio, tv adverts, print media etc
13
Q
10 what is PR
A
unpaid communications
14
Q
10 what are examples of promotion
A
branding
sponsorship
sale promotions
public relations
advertising
15
Q
10 what is people
A
who is involved with the transaction
skills and attitudes will affect perception
16
Q
10 what is an example of people
A
who enquires
who serves you
who serves customers
17
Q
10 what is process
A
how you actually buy the product or service
influence satisfaction
pay for parking on phone, shopping on phone, waiting in a queue
18
Q
10 what is physical environment
A
physical premises
car show room influences opinion of cars
design, décor, cleanliness, pictures, reception etc
19
Q
12 three features of a product
A
the core benefit
tangible product
augmented product
20
Q
12 what is the core benefit
A
what the product provides
washing machine to provide clean clothes for the customer
21
Q
12 what is the tangible product
A
features such as specification, reliability and design
22
Q
12 what is the augmented product
A
the extras such a brand name, delivery, guarantee and after sale services provided.
take your old washing machine and install the new one for you.
23
Q
12 what is the product life cycle
A
different stages of product life
development
introduction
growth
maturity
decline
24
Q
12 what is developement
A
stage when the product is being developed
investment in research costs
products tested and assessed to see if they are worth launching
no sales, so always negative cashflow
25
12 what is introduction
when the product is launched in the market
sales are slow, consumers not aware
high levels of investment still required to promote the product
cash flow remains negative
26
12 what is growth
sales begin to increase at a fast rate
consumers are more aware of the product
some investment still required
cash flow begins to become positive
27
12 what is maturity
rate of sales growth begins to slow
competitors may enter the market
sales may be high, but not increasing
cash flow is positive
28
12 what is decline
sales fall, growth is negative
new and better products are launched
cash flow turns negative again
29
12 what is the boston matrix
helps to categorise products and decide what to do next
identify poor performing products to help reinvest in
can leave business vulnerable to cash flow issues
can involve rebranding - an extension strategy
30
12 what are the two scales on a boston matrix
high to low market growth
high to low market share
31
12 what are the four categories of a boston matrix
cash cow - H share L growth
dogs - L share L growth
problem child - L share H growth
stars - H share H growth
32
12 what is a cash cow
high share of a slow growing market
mature market
do not need heavy promotion
well known and generate high sales
heinz baked beans
33
12 what is a dog
low share in a slow growth market
invest to revive the product or let it decline and eventually remove them
34
12 what is a problem child/question mark
low share in high growth markets
not yet established products
50/50 chance of succeeding
may need investing to do well
35
12 what is a star
high share in a high growth market
need to invest and promote the products
gain more distribution and ensure they remain stars
36
12 how does the product life cycle link to the marketing mix
mix is adapted at every stage of product life cycle
growth - price high
decline - reduce price
introduction - promote to create awareness
37
12 what is an extension stragety
prevent the sales of a product from falling and avoid or delay the decline of a product
medium to long term plan for lengthening a product life cycle, implemented in maturity or decline phase
38
12 what is an example of an extension strategy
increase promotional expenditure
revamp the product in some way
find a new target segment
new occasion of use for the product
39
12 why is the product life cycle valuable
the actual duration and precise nature will vary
managers need to know where a product is at any given time
managers must interpret data well
40
12 examples of different stages of product life cycle
new restaurant may take a while to establish itself, but a film is popular as soon as its release
medicine can be hot for 15 years but a song is only around for a few weeks
41
12 uses of the product life cycle
forecast future behaviour of sales
tool of analysis to assist in formulation of marketing strategies
aid the analysis of a product portfolio
42
12 limitation of the product life cycle
difficult to recognise where a product is in the life cycle
decline is not inevitable
not monitoring from a financial perspective can be bad
43
12 what is product development
modify an existing product or replace it with a new one
44
12 what are the stages in product development
generate ideas for new products
analyse ideas
select ideas to improve
develop prototypes
test products
launch
45
12 why would you develop a new product
end of life cycle for others
new opportunities in the market
build on strengths
achieve growth
match competitor actions
46
12 what are the risks of product development
not be viable, or technical problems along the way
not going to sell well, market is not understood, promotional problems or competitor actions
47
12 what do managers consider when investing
the time it will take to recover the initial spending and rate of investment
48
13 what factors affect price
cost
price elasticity of demand
49
13 what is price elasticity of demand
if demand is price inelastic, increasing price will increase revenue
if demand is price elastic, decreasing price will increase revenue
50
13 what is price inelasticity
price increase will lead to a smaller percentage fall in quantity demanded than percentage rise in price
51
13 what is price elasticity
price decrease will lead to greater percentage increase in quantity demanded than percentage cut in price
52
13 how do costs affect price
businesses must cover their unit costs
may use cost-plus pricing
higher sales levels leads to lower unit costs charging a lower price
53
13 why are high level sales important
higher level of sales enables fixed costs to spread over a larger output leading to lower unit costs and making it possible to charge a lower price
lower level of sales results in higher unit costs and requires a higher price to sell
54
13 what is penetration pricing
charges a low price to gain market share
when demand is sensitive to price/ elastic
low price gains high sales producing on a large scale
55
13 what is price skimming
much higher price is charged when the product is launched
demand is insensitive to price/ inelastic
heavy branding like an iPhone
56
13 what is dynamic pricing
changed rapidly in response to changing demand conditions
airlines,taxis,hotels track enquiries and raise prices accordingly
no one price for a ticket
57
14 What is target audience
understand the target group, how best to reach them
conduct research into how best to sell
58
14 what is the promotional budget
how much money the business has to spend on promotion
TV adverts are more expensive, so not possible on a small budget
59
14 what is the message received in the promotional mix
what does the business want to associate with itself
RedBull- high energy activities, extreme sports etc
60
14 how does technology affect the promotional mix
growth of online business creates new opportunities
target online advertising more effectively
define what regions adverts appear, use the algorithm to advantage
measure effectiveness of adverts
CTRS- click through rates
61
14 how can social media help promotional mix
create their own blogs, contribute to other blogs, promote their own products
viral marketing to create a buzz
62
14 what involves branding decisions
represents a promise made by a business to provide a specific set of benefits
recognise brands and values
features specific qualities
name, logo, slogan etc
63
14 how do brands hold reputational assets
reputation of the business is something of value to it
built up overtime
can be damaged
64
14 If a brand is strong....
demand is more price inelastic
customers = brand ambassadors
other products by brand
difficult for competition to gain market share
65
14 what is the AIDA model
Awareness
Interest
Desire
Action
66
14 why do you use the AIDA model
tv, radio, cinema bring attention, raising interests of people watching
detailed campaigns create desire
triggers action
67
15 what factors affect place
degree of coverage
costs of different strategies
nature of the product
degree of control over price and promotion
customer expectations and technological deliveries
68
15 how does degree of coverage affect place
how does the business want to reach customers, global, national,local
if spread is broad business may want intermediaries to reach all
is spread is narrow, business may want to distribute directly
69
15 how does tradition distribution go
producer, wholesaler, retailer, customer
70
15 how does modern distribution go
producer, retailer, customer
71
15 how does direct distribution go
producer, customer
72
15 how does cost of distribution strategies affect place
expensive for a business to set up own distribution channels
online sales opportunities allow business to become global at a lower cost
73
15 how does nature of the product affect place
high value products selling in low quantities are sold direct to customers
low value selling in high quantities require intermediaries, like a retailer
convenience items like gum are sold with wide distribution
74
15 how does degree of control affect place
the intermediary will gain some control over the promotion and price if used
otherwise the business controls everything
Aston Martin, Rolex, Gucci, etc, keep close control over their products
75
15 how does customer expectations of distributions affect place
customers expect multichannel distribution
access a product in many different ways
Tesco offers may shop sizes
technology revolutionised distribution in many industries, changing value and nature of physical stores
76
16 what do people do in the 7Ps
providing the service, advising & carrying out tasks
expertise & skills influence customers buying
training, awareness of customers requirements
managers decide on staff levels, investment in training
77
16 what does the process do in the 7Ps
part of customer experience to buying
stores complete by making process easier
buy online, collect instore, 24h home delivery check in etc
technology changes enabled improvement of businesses
78
16 what does the physical environment do in the 7Ps
first impressions
designed and preserved to tell us
marketing manager considers brand image
where to locate offices and stores, how to design them and how much to invest
depends on brand product nature and position
79
16 influences on the marketing mix
position in product life cycle
boston matrix
type of product
marketing objectives
target market
competition
positioning
80
17 how is good marketing decision made
by executives using logical frameworks such as marketing models
great decisions require intuition and understanding consumer psychology
short term decision should also work long term
81
17 how does evidence vs feelings influence decision making
business need to decide what to act on
quantitative research - based on science
management culture, mistakes = firing
quantitative data to avoid failure
qualitative data are preferred to quantitative
82
17 how is competitiveness an issue in the market
quality of design
build of the product
enthusiasm of staff
when a product has a USP and has value for money, it must focus on marketing alternatives so it stands out
83
17 how should we understand markets
large business carry out detailed market analysis on a regular basis
paralysis by analysis- gather so much data you are unable to make a decision
a focus on customers may pay off quite well
84
17 how should we interpret market data
correct techniques about correlation and extrapolation
specify the aspects of data most important, point in the right direction
interpret and draw conclusions from gathered information
85
17 how does price and income elasticity of demand affect marketing
average marketing director may not know price elasticities of the products
price elasticities change over time
certain features do remain constant
86
18 what is digital marketing
anticipating and satisfying the wants of a consumer through different forms of technology
87
18 what is e-commerce
element of digital marketing that it describes the buying and selling of goods and services through the use of electrical media
88
18 how is digital marketing and e-commerce useful
gather information quickly
build relationships with customers
target very specific segments
involve customers more in the marketing process
target global markets 24 hours a day
89
18 where are the reduced costs in digital marketing
digital marketing may reduce the need for expensive promotions because businesses can use their websites for much more specific targeting of their customers
90
18 what is quicker response
enables a business to respond quickly to the external environment. when new items are reported, digital marketing can utilise this news to capture customers interests
91
18 what does digital marketing and e-commerce depend on
how fats and how well the business implements it
technology does not benefit everyone businesses
watching the trends in the market and making sure they are adapting accordingly
