bus man booklet 2 Flashcards
What is the definition of marketing mix?
The elements of a firm’s approach to marketing that enable it to satisfy and delight its customers.
What is the marketing mix commonly described as?
The 4 P’s
What are the 4 P’s?
Price, place, product and promotion
Why are the 4 P’s manipulated?
To maximize sales and profit, create a brand, develop customer loyalty and to create a unique selling point/proposition
Define product
This includes the physical features and specifications of the product, (i.e. what it looks like, how reliable it is, quality of product, etc.)
What do businesses have to ensure when making a product?
Have to ensure that it considers its intended customer when designing/developing products to ensure that it meets their needs.
What are the key features a product should posses?
(ensure it appeals to the needs of target market)
Functionality, Reliability, Durability, Suitable packaging, fashionable and keeping in with social trends
Define price
This refers to the way the product is priced and the rationale behind it.
What factors must be taken into account when deciding how to price products?
Cost of production, Needs and wants of customers, Supply and demand, Competitor prices, profit
What are the 2 pricing strategies?
Price skimming and Penetration pricing
What is price skimming?
A firm charges the highest initial price that customers will pay then lowers it over time.
As the demand of the first customers is satisfied and competition enters the market, the firm lowers the price to attract another, more price-sensitive segment of the population
What is penetration pricing?
A pricing strategy used by businesses to attract customers to a new product or service by offering a lower price during its initial offering.
The lower price helps a new product or service penetrate into the market and attract new customers away from competitors.
Define place
This refers to where the product will be sold and how it will be distributed.
What are some conditions when it comes to place?
Where will people be looking for your product?
Will they need to hold it in their hands/try it on?
Will you use third party sellers or not?
Why is it important to consider your target audience when deciding where to retail your product?
To create easier access to business for customers
Define promotion
This refers to how the product will be advertised.
Its part of the marketing mix that public notices the most, this is therefore essential that the business selects the most appropriate of promotion for its target audiences.
What is the aim of promotion?
- Inform the customer e.g. prices, location, product features
- Build a brand image
- Create customer loyalty, encourage customer to buy again
- Persuade the customer to purchase the product for the first time or more regularly
What are methods of promotion?
Advertising, Sponsorship, Sales promotions
Define advertising
Paying for a message to be shown through various media, such as television, radio, magazines, newspapers, social media etc. it can be expensive
Define Sponsorship
Providing financial assistance to an individual, event or organization in return for exposure and advertising
Define Sales Promotion
Short-term sales initiatives to boost sales, for example, various offers such as ‘buy one, get one free’ (BPGPF), competitions, collect the tokens, loyalty cards, credit terms and coupons
Examples of Promotion
Television and print advertising.
content marketing, coupons
scheduled discounts
social media advertising
email marketing
display ads
What is SWOT Analysis?
SWOT is a study/ analysis/ planning tool undertaken by an organization to identify its natural strengths and weaknesses, as well as its external opportunities and threats.
Examples of SWOT
Internal strengths e.g. innovative staff, products unique selling point
Internal weakness e.g. high wastage, high staff turnover
External opportunities e.g. move into foreign markets
External threats e.g. increased competition, the need to keep up with changing technology
What does SWOT stand for?
Strengths, Weaknesses, Opportunities, Threats
What are the benefits of SWOT?
It analysis of the effectiveness of the company’s operation and internal factors that influence its success
Shows current and potential future position
highlights strengths and weaknesses against competitors
used to help the company meet customer needs and keep up with competition
What are the drawbacks of SWOT?
Weaknesses and strengths are often a matter of perception rather than fact
May be advised to employ outside company to carry out regular audit of the business
Open to interpretation (no 2 opinions are the same)
Information is never perfect and future is always changing
Which of the SWOT are internal (can be controlled) to the business?
Strengths and weaknesses
Which of the SWOT are external (cannot be controlled) to the business?
Opportunities and threats
What are strengths in SWOT?
Factors that are positive relative to competitors.
(currently achieving and can be controlled by the business)
It provides an analysis of a firm’s advantage over its competitors
What are weaknesses in SWOT?
Factors which are negative relative to competitors.
(these can be controlled)
Identifies areas where the firm is at a competitive disadvantage
What are the uses of SWOT Analysis?
To set objectives and highlight areas that require special questions.
What are opportunities in SWOT?
Factors in the external environment (cannot be controlled) that can be beneficial to the organization.
(future)
What are threats in SWOT?
Factors in the external environment that can be detrimental to the organization.
What is management style?
behavior and attitude of the manager
What are the 4 factors that influence the management style?
Nature of the task- is the task dangerous, creative, straighforward
Time- is there any time pressure? what time frame is involved?
Experienced of employees- experts? high or low skilled? new? motivated?
Manger preference- personality align with?
What are the 3 management styles?
Autocratic (tells)
Consultative (asks)
Laissez Faire (lets do)
What are the characteristics of Autocratic?
“do it the way I tell you”
- central decision making by manager with no staff input
- communication from the top down. Employees told what to do
-importance on completing task efficiently and effectively (degree of uniformity)
-high level of contol
When is an autocratic style appropriate?
-High risk or crisis situation, large groups of employees working on simple task
-Time is limited
-employees lack skills/knowledge
-prefers to maintain control/lack faith in staff
Advantages of autocaratic style?
High levels of clarity= clearly defined procedures=consistency in outcome
Employees’ roles and expectations set out plainly= performance can be monitored and staff held accountable
Decisions made quickly= highly responsive in time of crisis
Disadvantages of autocratic style?
Doesn’t allow the manager to access staff knowledge/ideas= potential that best decision is not made
Employees= no power= no chance to develop skills + feel undervalued= decreased morale= low job satisfaction = higher staff turnover
an ‘us and them’ mentality = lack of employee pride= meet expectations but not improve= lower overall business performance
What are the characterisitcs of Consultative style?
Decisions made by management (centralized) after discussion with employees to obtain their opinion
two way communication
obtaining information from staff to improve decision making but management still responsible for final decision= accountability
manager maintains ultimate control, however importance is on employee involvement and some control over info. flower passed over during decision making
When is a Consultative style appropriate?
more complex/ creative tasks, when elements of tasks employees have more knowledge over/ wider variety of considerations to be taken into account
limited time pressure
higher levels of experience and skills
likes to include employees and values input however still makes final decision
Advantages of consultative style?
Greater variety of ideas= improved decisions= improved bus performance
employees have some ownership= increased motivatin and commitment
employee development/ learning= allows management to identify high pot staff= increased employee development
Disadvantages of Consultative style?
slow due to time constrants
Some employees may not want to be consulted or some may not have knowledge to be able to communicate meaningfully
conflict or resentment b/c some ideas ignored
sensitive can become common knowledge b4 decision= oncreased fear amongst employees
What are the characteristics of Laissez Faire?
Decentralised- authority to make decisions is handed to employees
two way communication- management sets objectives and time constraints but employees report back to management on process
automomy= main importance= allow staff to select their own way to get outcome
manager hands control over to employees and monitors progress towards objectives
When is Laissez Faire style appropriate?
simple no requirements for uniformity- employees not need supervision// complex- highly dependent on employee skill- where solution may not be known
extended time period to make decisions
high level of expertise- employees may have more exp than management or certain tasks
managers prefer to delegate to employees, comfortable with hands off approach, sometimes lack sense of personal responsibility
Advantages of Laissez Faire
employees feels a sense of ownership= promote outstanding results
continual encouragement for creativity
management able to focus on other elements or organisation
employees able to respond quickly to issues that arise= empowered to make decisions= no need to run pass management
Disadvantages of Laissez Faire
complete loss of control by management= can lead to management being disconnected t4 lack ability to intervene when required
potential for misuse of organization resources
can breed personal conflicts whereby individuals do not cooperate and management is not there to direct or negotiate
can lead to sense of lack of direction for staff- not clear what is wanted or expected of them= lowers motivation
Define Quality
the degree of excellence in a good or service and its ability to satisfy the customer
What do quality management strategies aim to do?
Aim to minimize waste and defect rates in production, obtain consistently high standards of product and service, achieve set benchmarks
What are the 2 types of management strategies?
Proactive quality management- Prevents defects therefore decrease waste, decrease costs, and increase efficiency
Reactive strategies try to fix errors after they have already occurred.
State the 3 control…
Quality control
Quality assurance
Total Quality Management
Define Quality control
the process of checking the quality standards of work done or quality of raw materials or component parts
-done at different stages, checks against designated standards-eliminates post-production errors=prevents low quality products being sold to customers
A reactive strategy bc it detects and eliminates defects after the occur
Quality control process
1.Benchmarks set e/g/ 2% variance in measurements is
acceptable
2. inspections conducted
3. comparisons between product and benchmark made
4. corrective action in the event quality is deemed to be below benchmark
Examples of quality control
Batch testing- random sample from batch checked rather than every input/output
Secret shopper- used in service organizations (retail, restaurants, banks)- pretend customer assess quality of customer service + wait times, sales, cleanliness
Safety checks- where every output is checked- e.g. cars every car will undergo some tests before being delivered to customers
Pros of quality control
customers do not receive faulty goods or services=improved reputation
reduces need for refunds
relatively inexpensive strategy to implement
Cons of quality control
Creates waste=cost+enviromental impact
unless every product is inspected, inferior goods may still reach the customer= impact on reputation
time consuming
Define quality assurance
organization achieve certification of quality in its products from an independent body after being assessed
need to meet set standards for industry
Proactive because it seeks to use best practice to prevent errors from occurring but still includes checking mechanisms in case these do not work
Pros of quality assurance
reduces waste from errors=lowers cost + enviromental impact
external certification= improves competitiveness as increase customer confidence
reduced errors increases productivity
Disadvantages of quality assurance
Employees may need to be trained
documentations can be time consuming
expensive to organize external body to assess operations systems
Define total quality management
whole organization approach to achieving quality based on continuous improvement. part of culture with all employees having a role to play= internal customers able to give feedback to others within the organization
TQM=proactive- seeks to prevent defects from occurring
3 principles of TQM
continuous improvement- standards keep getting raised bc quality can always be improved= incremental improvement
Employee empowerment- employees are given direct responsibility through quality circles- small groups meet tougher to discuss ways of improving the quality process= proposals put to management
Customer focus- review through lens of customer needs and expectations but there are internal customers- those who use what your work group provides as well as external customer- the person who purchases your product. PPL, t4 view their work as one step in a continuous process rather than in isolation
Pros of TQM
highly adaptable to specific business requirements
reduces errors t/4 waste= cost and environmental impacts reduced
increases motivation- employees empowered + establishes a culture of quality
Cons of TQM
time consuming
requires a shift in culture
Employees require training to be able to identify methods to improve quality
