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A Level Business - Topic 3 > 3.4 Making marketing deicisions using the marketing mix > Flashcards

3.4 Making marketing deicisions using the marketing mix Flashcards

1
Q

Marketing mix

A

The main variables comprising a firm is marketing strategies.

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2
Q

The 7P’s

A

Price, Product, Place, Promotion, People, Process and Physical environment

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3
Q

What is Price to do with?

A

How consumers pay: e.g. cash and how much they pay.

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4
Q

What is Product to do with?

A

To meet customer needs and wants such as design features.

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5
Q

What is Place to do with ?

A

How the product reaches the customer.

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6
Q

What is Promotion to do with?

A

To do with how you communicate your product to potential customer.

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7
Q

What is Process to do with?

A

The ease of transaction .

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8
Q

What is People to do with?

A

To do with people within the business NOT the consumers.

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9
Q

What is Physical environment to do with?

A

How the product appears to the customer.

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10
Q

The influences on and the effects of changes in the elements of the marketing mix

A
  • Technology
  • Finance
  • Market research
  • Nature of the product
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11
Q

Finance

A
  • Profitable business is able to cut prices significantly, at least in the short term
  • Finance available
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12
Q

Nature of the product

A
  • Type of product can influence which elements of the mix are emphasised
  • Can spend more on advertising or more on the quality
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13
Q

Technology

A
  • Products with the latest technology may use advertising to inform potential customers of their existence and benefits
  • High prices to maximise short-term profits
  • Affects place element
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14
Q

Market research

A
  • Primary market research may be the most important influence is designing a marketing mix
  • It’s findings may provide information to help to make judgements on the form, functions and design of the products
  • May determine pricing strategies
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15
Q

Influences on and the value of new product development

A

Technology
- Developments in technology are the cause of many new products that come onto the market

Competitor’s actions
- A competitor producing a new product can be a spur to a rival to produce something then that is at least as good, if not better

The entrepreneurial skills of managers and owners
- Successful entrepreneurs require creativity - being able to think up new ideas for goods and services that fit with customer needs which leads to the development of many new products

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16
Q

Unique selling point

A

A USP allows a business to differentiate its products from others in the market.

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17
Q

Importance of unique selling point

A
  • Business can base advertising campaigns on their USP
  • Encourages brand loyalty
  • Allows firm to charge premium price
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18
Q

Stages of the product life cycle

A
  • Research and Development
  • Introduction
  • Growth
  • Maturity
  • Decline
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19
Q

Research and Development stage

A
  • No sales
  • R+D costs
  • Negative cash flow
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20
Q

Introduction stage

A
  • Low sales
  • Marketing costs
  • Negative cash flow
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21
Q

Growth stage

A
  • Improving costs
  • Marketing costs
  • Negative to Positive cash flow
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22
Q

Maturity stage

A
  • Peak sales
  • Consider extension strategies
  • Profits
  • Positive cash flow
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23
Q

Decline stage

A
  • Declining sales
  • CONSIDER EXTENSION STRATEGIES
  • Negative cash flow
24
Q

Extension strategies

A
  • Finding new markets for existing products
  • Changing the appearance or packaging
25
Q

The Boston Matrix

A

High relative market share, high market growth
- Star products

High relative market share, low market growth
- Cash cow

Low relative market share, high market growth
- Problem Child/ Question mark

Low relative market share, low market growth
- Dog

26
Q

Price skimming

A

Initially setting a high price and lowering it over time.
- used when there are no competitors in the market

27
Q

Price penetration

A

Initially setting a low price and increasing it over time.
- used to gain a foothold in the market

28
Q

Pricing tactics

A
  • Loss leaders: setting prices very low so consumers can purchase other products as well
  • Special-offer pricing: involves reduced prices for a limited period of time or offers such e.g. three for the price of two
29
Q

How businesses can make demand for their products more price inelastic

A
  • Differentiating products from those of competitors
  • Reducing competition through takeovers and mergers
30
Q

Promotion

A

Promotion is bringing consumers’ attention to a product or business.

31
Q

Promotion aims to achieve targets:

A
  • Attract new customers
  • Improve the position of the business
  • Ensure the survival and growth of the business
  • Increase awareness of a product
32
Q

Promotional mix

A

The combination of methods used by businesses to communicate with prospective customers to inform them of their products and to persuade them to buy these products.

33
Q

Elements of the marketing mix

A
  • Advertising
  • Exhibitions/ fair trade
  • Packaging
  • Branding
  • Public relations
  • Merchandising
  • Personal selling
  • Sales promotion
34
Q

Advertising

A

Advertising is a paid form of non-personal communication using mass media to change the attitudes and buying behaviour of consumers.

35
Q

Informative advertising vs Persuasive advertising

A

Informative advertising: designed to increase consumer awareness of a product by providing consumers with factual information.

Persuasive advertising: attempts to get consumers to purchase a particular product by claiming the product is better than the competition.

36
Q

Sales promotion forms

A
  • Merchandising
  • Special offers and competition
  • In-store demonstrations
  • Coupons, vouchers and free gifts
37
Q

Packaging

A

Packaging emphasizes the attractiveness of the product ad informs consumers of its features, functions and contents.

38
Q

Exhibitions and trade fairs

A

Events staged to attracts people involved in a particular market, both sellers and buyers.

39
Q

Branding

A

Establishes an identity for a product that distinguishes it from the competition. Successful branding allows higher prices to be charged and can extend a product’s life cycle due to brand loyalty.

40
Q

Personal selling

A

Involves visits by a firm’s sales representatives to prospective customers.

41
Q

Public relations

A

PR is promoting the company’s image to establish a favorable public attitude towards the company.

42
Q

Influences on the choice of promotional mix

A
  • The product’s position in its life cycle
  • The type of product
  • The finance available to the business
  • Where consumers make purchasing decisions
  • Competitor’s actions
43
Q

Distribution of a product

A

Involves the range of activities necessary to make the product available to customers.

44
Q

Factors that affect choosing outlets and distributors

A
  • Location
  • Credit terms
  • Willingness to display products in prominent positions
45
Q

Wholesalers

A
  • Buy high volume from producers
  • Purchasing economies of scale
  • Sell to retailers
  • Specialise in logistics
46
Q

Retailers

A
  • Buy smaller volume from retailers or producers
  • Sell to customers
  • Specialise in high reach
47
Q

Types of distribution channels

A
  • Traditional
  • Modern
  • Direct
48
Q

Traditional

A

Producer —> Wholesaler —> Retailer —> Consumer

49
Q

Modern

A

Producer ——> Retailer —> Consumer

50
Q

Direct

A

Producer ———> Consumer

51
Q

Factors that influence choice of a distribution channel

A
  • Type of product
  • Nature of the market
  • Technical complexity of the product
52
Q

Multi-channel distribution

A

Where firms use more than one type of distribution channel.

53
Q

Integrated marketing mix

A

An integrated marketing mix is one that fits together.

54
Q

Influences on an integrated marketing mix

A
  • Position in the product life cycle
  • Boston Matrix
  • Type of product
  • Marketing objectives
  • Target market
  • Competition
  • Positioning
55
Q

Value of digital marketing and e-commerce

A
  • Businesses can gather more detailed information about consumers
  • Greater contact between consumer and business
  • Digital marketing makes it easy for businesses to set up and sell almost anywhere in the world

A Level Business - Topic 3 (4 decks)

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