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IB Business Management > 4.5 4 P's of Marketing > Flashcards

4.5 4 P's of Marketing Flashcards

1
Q

Product Life Cycle

A

shows the different stages that a product goes through from its development to its decline

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2
Q

What is the research and development stage of the PLC?

A

investigating, developing, and designing a product before it is launched

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3
Q

What is the introduction/ launch stage of the PLC?

A

the product is introduced to the market and requires promotion to make customers aware

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4
Q

What is the growth stage of the PLC?

A

sales revenue increases and as the product becomes more known the firm gains market share

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5
Q

What is the maturity stage of the PLC?

A

sales revenue peaks as growth slows. due to minimal growth and competitors entering the market, the firm has to consider extension strategies

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6
Q

What is the decline stage of the PLC?

A

sales continually decline until it is withdrawn due to changing tastes, obsolescence, and technological advances

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7
Q

Extension Strategies

A

marketing approaches used to prolong the product life cycle in the maturity stage/ as it enters the decline

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8
Q

What are the extension strategies?

A
  1. Price reduction - to encourage purchases
  2. Redesigning - to add value/ enhance the product (special features/ limited editions)
  3. Repackaging - more attractive
  4. New markets
  5. Product differentiation - adding a unique element to have the product stand out from competitors
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9
Q

Product Portfolio

A

A business sells a variety of products

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10
Q

Boston Consulting Group (BCG) Matrix

A

draw the matrix

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11
Q

What is the star in the BCG Matrix?

A
  1. high market growth rate + high market share
  2. at the growth stage of the PLC
  3. invest into these to turn into cash cows
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12
Q

What is the question mark in the BCG Matrix?

A
  1. high market growth rate + low market share
  2. at the launch stage of the PLC
  3. yet to become profitable but need investment to become stars
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13
Q

What is the cash cow mark in the BCG Matrix?

A
  1. low market growth rate + high market share
  2. at the maturity stage of the PLC
  3. most profitable of their product portfolio
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14
Q

What is the dog in the BCG Matrix?

A
  1. low market growth rate + low market share
  2. at the decline stage of the PLC
  3. poor cash flow
  4. must decide whether to invest in extending the life or withdrawal
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15
Q

Branding

A

a marketing technique used to give a product or business a unique name or identity

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16
Q

What are the aspects of branding?

A

Awareness, Development, Loyalty, and Value

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17
Q

Brand awareness

A

how well people know about, recognize and remember a particular brand (allows businesses to attract new customers leading to more sales)

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18
Q

Brand development

A

communicating the value of a brand and what the brand stands for to strengthen the name and image (it shapes peoples perception of a brand leading to more loyalty)

19
Q

Brand loyalty

A

retaining customers so that they repeatedly buy from the same brand irrespective of price or convenience

20
Q

Brand value

A

the premium that customers are willing to pay for a brand name above the value of the product itself

21
Q

What are the pricing strategies?

A
  1. Cost-plus pricing
  2. Penetration pricing
  3. Price skimming
  4. Psychological pricing
  5. Loss leader
  6. Price discrimination
  7. Price leadership
  8. Predatory pricing
22
Q

Cost-plus pricing

A

a pricing strategy that involves adding a percentage/ predetermined amount of profit to the cost per unit of output

23
Q

Penetration pricing

A

a pricing strategy that involves setting low prices to gain entry into a market. Once the product has established market share, prices can be raised

24
Q

Price skimming

A

a pricing strategy that involves initially setting high prices for a limited period of time in order to gain short term profit and then gradually reducing it

25
Q

Psychological pricing

A

a pricing strategy that involves rounding down numbers to make prices seem lower to buyers

26
Q

Loss Leader

A

a pricing strategy that involves setting the price of a product below its production cost to entice customers to buy their other products with high profits in addition to the loss leader product

27
Q

Price Discrimination

A

a pricing strategy that involves charging different prices to different groups of customers for the same product

28
Q

Price Leadership

A

a pricing strategy that involves market leaders setting a price for its products and other firms in the market set the same prices

29
Q

Predatory pricing

A

a pricing strategy that involves setting temporarily low prices to force small competitors out of the market

30
Q

Above the line promotion

A

mass media that is used to promote brands to a wider audience, not specific to individual consumers (however it is often very costly)

31
Q

Below the line promotion

A

non-mass media that is used to promote brands which is personal and targeted to specific individual consumers

32
Q

Promotional mix

A

the combination and balance of below and above-the-line promotion

33
Q

Viral Marketing

A

a promotional strategy that uses social networks to generate online word-of-mouth marketing to raise product and brand awareness

34
Q

Social Media Marketing

A

a promotional strategy where businesses use social media to directly promote their products to a broad audience through one-way communication

35
Q

Social Networking

A

a promotional strategy that uses online platforms to encourage people to share their opinions, ideas, and feedback in order to maintain two-way communication between the business and customers

36
Q

Guerilla Marketing

A

a low-cost, unconventional marketing strategy that is innovative, has a significant promotional effect and leaves a lasting impression on the general public

37
Q

Place

A

the ways in which products move from producer to consumer (distribution channels)

38
Q

Intermediaries

A

a middleman / third party who takes products from producers and sells them to consumers

39
Q

Retailers

A

large stores that stock the goods for consumers to purchase that are well-placed to reach consumers and help with promotion

40
Q

Wholesalers

A

firms that purchase large quantities of products from a manufacturer and then distribute the bulk purchases to retailers

41
Q

Agents

A

negotiators with knowledge of specialized industries who sell goods to consumers

42
Q

Importance of branding

A
  • encourages customer loyalty
  • distinguishes it from other rival products
  • price advantages (since brands have a perceived value they are able to charge high prices)
43
Q

Importance of packaging

A
  • functionality (physical protection)
  • helps customers to identify and recognize a product (unique designs can attract the attention of buyers)

IB Business Management (37 decks)

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