4. Marketting

Question 1

Market share

Answer 1

Market share is the percentage of a firms sales revenue in relation to the whole industry’s sales revenue
firm/industry x 100

measurement of one organization’s sales (total revenue) in relation to the total industry sales (total revenue). The market share is presented as a percentage.

organization’s sales revenue divided by industry’s sales revenue x 100

Question 2

Discuss possible changes to a business’s marketing mix to reduce the loss of customers.

define too

Answer 2

Marketting mix is the use of marketting tools to influence consumer spending

Marketting mix is the 4Ps but dont forget they are afctually 7

Price; reducing or promotional pricing
Place;
Promotion; increasing
Product; develope improvement

People
Physical evidence
Process

Question 3

Product innovation features

Answer 3

Product innovation features could include:

the development of a new product
improvements of old product

, redesigned goods or services – creative innovation
quality improvements made to a product
the inclusion of new components, materials or desirable functions into an existing product – adaptive innovation.
It results from successful research and development which can be expensive, time consuming and risky

Question 4

innovation ib business definition

Answer 4

putting an idea to action

Question 5

product-orientated business definition, advantages and disadvantages

Answer 5

Product oriented businesses are business that focus on increasing the quality of a good instead of consumer needs.

cut costs on market research
high product quality

However:

Without market research, the risks that customers may not be interested or like their new products are higher.
High development costs
New ideas from customers may emerge from a market research.

Question 6

Marketing objectives define and examples

Answer 6

These are goals that a business wants to archive

Marketing objectives include:

attract new customers
enter new market
improve brand loyalty
increase awareness
increase market share
increase profit
increase revenue
increase sales
retain existing customers.

Question 7

Ways that market share can be measured

Answer 7

Ways that market share can be measured include:

by revenue (value), in terms of currency ($, €, ¥, etc.).
by unit sales (volume).

Question 8

Describe all the features of the marketing mix

Answer 8

Features include:
Price
Place
product
promotion
people
physical evidence
process

Product:
This refers to the tangible or intangible goods
Price:
the amount of money customers are willing to pay for a product or service.
Place (Distribution):
Place refers to the distribution channels and locations where customers can access and purchase the product or service.
Promotion:
Promotion involves communication strategies aimed at persuading and informing on the product.
People (employees):
People refer to the individuals who are involved in delivering the product or service to customers.
Process:
the procedures to deliver the product or service to customers effectively and efficiently.
Physical Evidence:
Physical evidence refers to the tangible elements that customers encounter when interacting with a product or service.

promotion by means of effective communication with customers
a coordinated marketing mix
branding based on the humanitarian award and the mission of the school
the school and its location, which is the product and is differentiated from similar organizations
Product: school environment, ethos, extra curricula activities, boarding school, other aspects of service.

Question 9

Characteristics of a niche market

Answer 9

Characteristics of a niche market include that they:
* are narrow
* specific on quality of product

• are smaller than most markets or a fraction of a market
• often require specialized processes (marketing or operations) to fill the niche
• more specific in terms of features or quality of the product or service
• given the above niche markets or segments may be characterized as having higher final prices to consumers.

Question 10

marketing plan
defintion, adavntages and disadvantages

Answer 10

A marketting plan is the process of forming objectives and planning strategies to meet these objectives.

Possible benefits include:
solutions to problems
helps in decision making
used to solve problems

expensive
time consuming

it provides a framework for the introduction of the new product to the market. In this instance important because it is a completely new product and Medimatters is a new business
it helps to develop marketing objectives/targets, again important because of the lack of experience of the owners
it could help with marketing budgeting, relevant because of limited finance
helps marketing decision making
keeps stakeholders informed
any other relevant benefit.

Question 11

Define the term target market.

Answer 11

A target market is defined as a group of consumers with similar needs and wants tha a business focuses on.

/characteristics (demographic) that a business decides to focus on in terms of its operations and/or marketing. A4A’s target market for its adventure parks has been families.

Question 12

Define and construct a position/perception map

Answer 12

Analyses how consumers percieve a good compared to competition

REVISE THIS AND DO EXAMPLES

Question 13

Define the term unique selling point/proposition (USP).

Answer 13

A unique selling point is any aspect of the organization that enables differentiation in consumers’ minds from the competitors.

Question 14

Explain how companies differentiate themselves

Answer 14

Price differntiation
branding

Companies differentiate themselves from their competitors in many ways, such as:

through their products (USP of their goods and services), or the range/portfolio of products they may offer their customers;
through their pricing strategies (e.g. price leadership or premium pricing);
through the relationships they build with their customers (customer service);
through their reputation and image (branding);
through other marketing aspects, such as the packaging they use, or the type of promotion and advertising they do;
through their ethical objectives (CSR) and particular values they may defend;
through their workforce (e.g. talented creative workers, cultural diversity);
through their operations (e.g. what they do, where, how);
through their innovative practices (e.g. R&D leading to particular product features or performance);
through their strategies (e.g. franchising, international growth etc.).

Question 15

Define Sales forecasting

Answer 15

Sales forecasting is a quantitative technique used to predict the levels of sales expected in future years.

Question 16

Explain one advantage and one disadvantage for Jacob of using convenience sampling.

Answer 16

Advantages: Cheap method, and he’s concerned with cash flow, easy – can he spare teachers’ time spent on this?

Disadvantages: Biased, might ask wrong people, difficult to focus, sample may not represent people in Dodoma.

Question 17

Secondary market research or desk research

Answer 17

Secondary market research or desk research refers to the collection of second hand data by a business for decision-making that is derived from second hand sources /published sources by a third party. It has not been collected first hand by the business themselves.

Question 18

Advantages and disadvantages of secondary research

Answer 18

Quick
cheap

biased
outdated

Advantages of secondary market research include:
* Efficient in terms of time – the data on wine consumption patterns, for example, has already been collected by someone else and is available.
* Effective in terms of cost – often, secondary research is free and, when not, is typically less expensive than the process of gathering primary research.
* Often, ample secondary research exists. On certain topics or related to certain markets, secondary research can be extensive. It has allowed SV to consider new geographical markets which it may not have considered before.
* Others have often thought through many of the core issues and a business can benefit from the insights of experts of collated data and written about them.

Disadvantages of secondary research include:
* Lack of precise focus on the issue or problem concerning a business
* Lack of timeliness – often secondary research is outdated
* Uncertainty about the quality of the data collection/research.

Question 19

two relevant secondary market research methods (sources)

Answer 19

Academic journals
Governement publications

Possible methods (sources) of secondary market research include:

medical journals
lists of pharmacies
lists of medical professionals, hospitals etc
government publications relating to medical/pharmaceutical issues.

Question 20

Explain one advantage and one disadvantage for JVS of using focus groups for its market research.

Answer 20

dvantages of focus groups include:
* They can provide detailed information about customer feelings, perceptions and opinions.
* They are cheaper than performing individual interviews.

Disadvantages of focus groups include:
* the results are difficult to analyse.
* They may not be representative of the target market as a whole

Question 21

State two methods of primary market research

Answer 21

Surveys
Interviews
Focus groups
Observations

Question 22

outline two suitable methods of sampling

Answer 22

Methods could include:

quota
random – may not be suitable as customer population is only a small part of whole
stratified/systematic – probably for 5 European countries
cluster
convenience – most convenient unlikely to be those influenced by brand, bias
snowball – but for the European market?

Question 23

Explain a suitable promotional mix to attract new students.

Answer 23

Above the line methods is any promotion aimed at mass or large audiences
eg
tv advertisements
newspapers
magazines

Below the line promotion (BTL) refers to any promotion that is not carried out in the mass media
eg
direct marketting
emails
loyalty cards
public relations
word of motuth

Question 24

Describe one reason why brand loyalty would be important to PP.

Answer 24

Competition

Brand loyalty would be important to PP given that they operate in a local market with a number of competitors and that the prices they charge are higher. Given this fact, it would be critical for PP to have brand loyalty or their sales could fall (although not on the stimulus, sharp-eyed candidates may spot that PP’s pies are price inelastic given the additional information for 2018).

Question 25

advantages and disadvantages of small organizations compared to large organizations.

Answer 25

In general, disdvantages of small businesses include:
CANT GET
economies of scale
market leader status
increased market share.

In general, advantages of being small include:
greater focus
greater communictaion
GREATER 3Cs

Question 26

construct a boston consulting group matrix

Question 27

roles of promotion

Answer 27

PROVIDING INFORMATION
PERSUASION

Promotion will have to be very focused to be effective.

Two aspects of promotion:
* Providing information: This is an upmarket business offering quite a different kind of tourist service. Potential customers will want to know a great deal about the specialities, such as locally produced goods and services, local cuisine, local culture, luxurious facilities and services

• Persuasion: Probably important early in the life of the business but less so as word-of-mouth promotion will now be a critical way to get new customers (C2C). How many customers are return visitors? Advertising through public relations may well be important, as tourist destinations often appear in travel pages of newspapers.

Question 28

explain two benefits of having a strong brand.

Answer 28

Consumer loyalty
competite advantage

Brand: an identifying name, symbol, image or trademark that distinguishes a product/service from its competitors.

Benefits could include: emphasizing the uniqueness of service; reinforcing word of mouth; strengthening name; creating and maintain a strong image; easier to introduce new products through family branding; competitive edge.

Question 29

features of wholesalers

Answer 29

Common features of wholesalers include:
* breaks large quantities of product into small stock quantities for retail businesses.
* BULKBUYING
* generally offering stock for predominantly one industry (furniture, fruit, electronic parts, auto parts, etc) and building up product knowledge to help retail businesses increase the opportunities for retail success.
* allow retail businesses to purchase on credit or even allowing retail business to purchase stock on a sale or return basis.
* given the large quantities of stock purchases, being able to experience significant purchasing and marketing economies of scale.

Question 30

Price skimming

Answer 30

Price skimming is setting prices high when introducing a new product to the market.

Opposite of price penetration

This strategy typically works only for a limited time, as competitors will respond to the new product with innovations to their own products. As competitors introduce new products in response, demand for the original company’s product (the company price skimming) falls, and prices must be lowered.

Question 31

explain two pricing strategies

Answer 31

Pricing strategies that SV might consider include:
* Cost-plus (mark-up) – SV may want to return to this pricing strategy, which guarantees that for each bottle of wine it sells the business is covering its per unit costs. However, SV’s brand identity might suffer if it lowered prices.
* Penetration – SV could use this pricing strategy as it enters new markets. Penetration pricing would allow SV to attract first-time customers in new markets with lower-than-normal pricing. Once some brand loyalty develops, SV could then raise prices.
* Psychological – Whereas psychological pricing sometimes refers to pricing below certain thresholds ($9.99 rather than $10.00) for a psychological effect, another form of psychological pricing is pricing a product high as a way of suggesting that the product is of high quality or value. SV might try to strengthen its brand identity with psychological pricing along this line, especially as the competition is intense.
* Loss leader – SV could try a loss-leader strategy, whereby it sells one of its wines at very low prices in an attempt to get consumers to buy SV wines. Other varieties of SV wines, however, would be priced in a fashion to compensate for the losses on the one type. This strategy, like others involving attracting customers through low prices, could weaken SV’s brand identity.
* Price discrimination – SV might consider is price discrimination, where SV sets the prices based upon the market that it is entering. For example, SV might charge more for wines in New York City than in Charlotte, NC. Both cities (major banking centres in the United States) have upscale buyers. Nevertheless, prices of virtually all types of goods and services cost less in Charlotte than in New York.
* Premium pricing – Though premium pricing is not in the guide, candidates are free to use it if they wish. Premium pricing occurs when a business inflates its prices precisely to enhance brand value. Consumers think that, by paying more, they are getting a better product.
* Promotional pricing – setting pricing very low for a short period to get customers to buy your product, often for the first time.
* Value-based pricing – setting a price based upon what consumers perceive the value of the product to be rather than on the actual cost to produce.

Question 32

Explain the factors influencing a suitable promotional strategy

Answer 32

Market; intellects prfer below the line like emails
cost; above the line may be expensive for new businesses

The factors influencing a suitable promotion/advertising strategy are likely to be:

the newness and originality of the product requires information to be communicated
the product consisting of an app and a lens requires explaining to potential customers
its likely customers which will include both the medical profession and final consumers
promotion will depend on the market chosen: the medical professionals may best be contacted via conferences, articles. The general public through paid for advertising. By Medimatters or retailers?
the size of the business, it is a small business, how much do they have to spend?
its marketing mix – it has to be consistent with it
reference to Brazil/zika virus can be considered as context.

Question 33

describe two features of batch production.

Answer 33

Standardised products
produced in steps

Possible features could include:

separate groups of products can be produced – useful because different makes of phone may need a different lens
suitable for likely scale of production about 1000 items: unlikely to be mass produced and job production would not be appropriate
might involve changeover costs, but lens costs will be small compared with price
involves holding of stocks. Issue for Medimatters? Or manufacturers?

Question 34

Predatory pricing ads and dis

Answer 34

Predatory pricing is a pricing method where a product or service is set at a very low price, intending to drive competitors out of the market.

Competeive advantage
attracts consumers

price war
expensive
illegal in some countries

Question 35

Define the term loss leader pricing strategy.

Answer 35

A loss leader pricing strategy occurs when a business sells a product or products at a low price, often at a loss, to attract more customers.

Question 36

Explain the relationship between Rasen’s product life cycle and FC’s marketing mix.

Answer 36

How to influence the following to prevent decline in product life cycle

Price
place
product
promotion

ie

Introduction Stage:
Product: Launching new product, limited features.
Price: Penetration pricing or price skimming.
Place: Limited distribution channels.
Promotion: Building awareness and education.

Growth Stage:
Product: Product differentiation, expanding features.
Price: Stable prices, competitive pricing.
Place: Expanded distribution channels.
Promotion: Persuading customers, building brand loyalty.

Maturity Stage:
Product: Product innovation, diversification.
Price: Competitive pricing, discounts.
Place: Optimized distribution channels.
Promotion: Defending market share, reinforcing brand loyalty.

Decline Stage:
Product: Streamlined features, discontinuing unprofitable variations.
Price: Adjusting prices downward, offering discounts.
Place: Consolidating distribution channels.
Promotion: Scaling back promotion, liquidating inventory.

Question 37

Discuss the importance of branding

Answer 37

Differentiate from competition
USP
Good branding attracting new consumers
brand loyalty

Question 38

State two stages of the product life cycle

Answer 38

• Introduction
• Growth
• Maturity (or Saturation)
• Decline
• Withdrawal.

Question 39

Explain one method of above-the-line promotion and one method of below-the-line promotion

Answer 39

Methods of above-the-line promotion that DH could use include:

television advertising
radio advertising
advertising in newspapers, journals, magazines, or trade journals
cinema advertising
billboards.
Methods of below-the-line promotion that DH could use include:

direct mailing
exhibitions and trade fairs
sponsorship
public relations
celebrity endorsement
personal selling.

Question 40

Define the term brand loyalty.

Answer 40

faithfulness consumers have to a brand

Consumers’ faithfulness to a particular brand, which will allow a business to see repeat purchasing by consumers and/or over the longer term, much more acceptability in raising the price of its products/services.

Question 41

explain one advantage and one disadvantage for CM of using a cost-plus (mark-up) pricing strategy.

Answer 41

One advantage for CM of using a cost-plus pricing strategy is the fact that it will be CM that covers all the costs and ensures a certain percentage of profit to be made. It is evident given the figures above that CM makes a profit. CM’s ability to make a profit ensures long-term survival. CM’s meals are perceived as good value for money, hence the strategy is effective.

Given the increase in competition, CM can be flexible and reduce the margin set above the costs. Flexibility in pricing is an important factor when there is an economic downturn, as well as increased competition.

A possible disadvantage is that CM’s costs are likely to be higher than competitors who supply non-organic meals. Together with the customers’ unwillingness to pay a premium price during an economic downturn, CM might see a further fall in demand as seen in the fall in total revenue in 2018.

Question 42

Describe one step in the development of a brand.

Answer 42

Common steps in developing a brand include:

consideration of the business’ strategy
identification of the target market
doing market research
focusing on any one of the four Ps for purposeful positioning
development of market vision around the USP
selection of a name and logo
development of a marketing strategy

Question 43

Cost-plus pricing

Answer 43

Cost-plus pricing is a pricing method where the total cost of producing is calculated which includes variable costs (direct costs) and a fixed cost component (or part of the overhead). Then a profit margin per unit is added to obtain the selling price.

Question 44

Explain the importance to LB of two elements of the extended marketing mix.

Answer 44

Physical evidence is referred to as the environment in which the goods or services are delivered.

People makes reference to the way employees relate to and communicate with customers.

Process could be related to the way LB provides a unique way of making payment for guests.

Question 45

DECISION TREES (ADS/DIS) AND HOW TO CALCULATE

Question 46

Explain one cost and one benefit for MM of setting up an e-commerce website.

Answer 46

The benefits to MM from setting up an e-commerce website will be linked to increasing customer awareness and sales.

CD and especially vinyl sales should increase, as the e-commerce site may allow for targeting more potential customers in different regions who are interested in vinyl records and possibly CD. There is a greater chance of success as relying on customers for such a retro segment to visit the physical store is rather limited.
More detailed product descriptions, customer feedback/reviews will be possible. The e-commerce website will deepen customer relationships, especially if MM can run a social media campaign alongside building brand and customer loyalty to the site.
The e-commerce platform will also allow MM to generate much needed advertising revenue through increased loyalty in the future.
The costs are linked to the inevitable restructuring of the business that e-commerce will demand and could be considered to be both short term and long term.

The e-commerce site will need to be built, managed and monitored by a new staff member. This will drain MM’s cash reserves at a time when total revenue is falling.
Existing staff will require training or newly employed staff hired such as technology experts to run and update the e-commerce facility and possibly create social media support. Costs are likely to rise in the short term and again, MM is facing fall in revenue and finance is limited.
If the e-commerce site is to be fully functional then new distribution channels around delivery of vinyl records and newly released CDs that are both growing in sales to the customer will need to be identified, researched and set up. This will also take time and André will have to find additional resources. The stimulus indicates that finance is limited.

An e-commerce website will add a new layer of complexity to MM’s operations and logistics and MM has not got the right experience therefore more finance will have to be raised for training, hiring people and so on.

Question 47

Explain one advantage and one disadvantage of sales forecasting

Answer 47

Sales forecasting is a quantitative technique used to predict the levels of sales expected in future years.

Benefits
Effective future planning
Better cash flow management:
**Helps in decision making **

Cons
Assumes future is same as past
Not enough data. New companies do not have previous data upon which to draw.
Changing markets. Rapidly changing markets can lead forecasts to be invalid.
Flexibility. Forecasts should only be seen as a guide. Managers need to remain flexible rather than following plans blindly.Advantage

Question 48

The three types of sales forecasting methods that specialists use are:

Answer 48

causal models
There are a number of both internal and external factors that affect sales.
time series analysis
identify trends in historical data
qualitative techniques

Question 49

There are three main types of variations in sales forecasting data:

Answer 49

seasonal
Seasonal variations in data occur when products have higher sales volumes at certain times of the year.
cyclical
in sales data occur when sales are affected by the economic cycle ie expansion, peak, reccesion, trough
random variations
changes to sales data caused by unpredictable events