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BM > 4.5 - Marketing Mix > Flashcards

4.5 - Marketing Mix Flashcards

1
Q

What is marketing mix?

A

A set of decisions which need to be made by managers. 4p marketing for goods and 7ps for services.

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2
Q

What are the two types of products?

A

Tangible and intagible

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3
Q

What are some other types of products?

A

producer products(for producers) and consumer products(for consumers)

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4
Q

What are types of consumer goods?

A

FMCGs(fast moving consumer goods), perishables, durables and speciality goods

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5
Q

What are FMCGs?

A

Products which do not have an expiration date but wear out quickly so conusmers buy them again and again. E.g - toilet paper/toothbrush

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6
Q

What are perishables?

A

Goods that perish very quick. E.g - food

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7
Q

What are durables?

A

Products that can last a long time. E.g - electronic devices

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8
Q

What are speciality goods?

A

Goods with unique characteristics and are distributed through limited distribution channels. E.g - designer clothes

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9
Q

What is product life cycle?

A

stages a product goes through from launch to decline.

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10
Q

What are the stages of product life cycle?

A
  1. R&D(research and development)
  2. Launch(introduction)
  3. Growth
  4. Maturity(saturation)
  5. Decline
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11
Q

What is R&D?

A

research and development stage. Protoype - initial version of a product from which later versions are developed.

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12
Q

What is the relation between R&D and investment, profits and cash flow?

A

It has a high reliance on investment, no profits and cash outflows only.

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13
Q

What is launch?

A

Stage of the product life cycle when the product becomes available for purchasing.

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14
Q

What is the relation between launch and investment, profits and cash flow?

A

There is still a high reliance on investment, no profits, negative cash flow but improving

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15
Q

What is growth?

A

Stage of the product life cycle where sales are growing at a relatively fast rate. Comapanies can use economies of scale and competition intensifies.

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16
Q

What is the relation between growth and investment, profits and cash flow?

A

Investment still high, but profits and cash flow become low positive

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17
Q

What is maturity?

A

The stage where the sales reach their peak. Competition stabalises and managers try to target new segments.

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18
Q

What is the relation between maturity and investments, profits and cash flow?

A

Investment is spread across promotional(remind people) and extension strategies, profits are high and cash flow is positive

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19
Q

What is decline?

A

The stage when sales fall after reaching the peak. New products are launched when old products reached decline.

20
Q

What is the relation between decline and investments, profits and cash flow?

A

No or little investment and costs, positive but failing profit and cash flow.

21
Q

What are extension strategies?

A

Organisations action plan to avoid decline and prolong maturity.

22
Q

What is brand?

A

A combination of name, symbol and other characteristics that is associated with a certain business/product

23
Q

What is branding?

A

The process of adding a set of characteristics to a business/product that adds value and differentiates

24
Q

What is brand awareness?

A

The extent to which people are able to recognize a brand.

25
Q

What is brand development?

A

A strategy that aims at strengthening the brand and improving its awareness

26
Q

What is brand loyalty?

A

Customers dedication to make repeat purchases of the same brand.

27
Q

What is brand value?

A

Premium that customers are willing to pay above the actual value of the product.

28
Q

When is brand awareness important in the PLC?

A

Very important at the launch stage of the product life cycle.

29
Q

How is brand development related to the PLC?

A

It acts as an extension strategy(prolongs maturity)

30
Q

How can brand loyalty be improved?

A

by WOM and brand ambassadors

31
Q

What is the issue with brand value?

A

It acts as an entry barrier.

32
Q

What are the advantages of branding?

A
  • Legal protection
  • Differentiation strategy
  • Adds value
  • Increases profit margins
  • Customer loyalty
33
Q

What are the disadvantages of branding?

A
  • Time consuming
  • Expensive
  • Good brand ≠ good product
  • Customers overpaying for “feel good” factor
34
Q

What is price?

A

The amount of money required or given in payment for something.

35
Q

What are the pricing strategies?

A
  • Cost-plus
  • Penetration
  • Loss leader
  • Predatory
  • Premium
36
Q

What is cost plus pricing?

A

Average cost+ markup
markup ≠ profit margin
markup = direct costs + %

37
Q

What are the advantages and disadvantages of cost plus pricing?

A

Costs are covered but disregards competitors prices

38
Q

What is penetration pricing?

A

Setting low prices to penetrate the market and attract more customers

39
Q

What are the advantages and disadvantages of penetration pricing?

A
  • Potential to increase sales and increase brand awareness
  • Profitability(cheap, low quality) and brand value are at risk
40
Q

What is loss leader pricing?

A

Selling some products at a loss in order to attract more customers in order to buy more products.

41
Q

What are the advantages and disadvantages of loss leader pricing?

A
  • Attracts potential customers, works well for FMCGs causes brand switching
  • Works only if customers purchase other products- otherwise loss
42
Q

What is predatory pricing?

A

Temporary measure to squeeze cometitors out of the market. Customers may benefit from predatory pricing in the short term but in the long term it might result in a monopoly

43
Q

What are the advantages and disadvantages of predatory pricing?

A
  • Increased market share and a high entry barrier
  • Not sustainable in the long term or unethical/illegal
44
Q

What is premium pricing?

A

Setting a high price for premium high quality goods.

45
Q

What are the advantages and disadvantages of premium pricing?

A

High profit margins and increased brand value but sales volume is low. Also inapplicable to certain products.

BM (12 decks)

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