business mm from notes Flashcards
What is the difference between product-led and market-led approaches?
Product-led focuses on high levels of research and development into the product, while market-led conducts extensive market research to determine customer wants.
How do product-led businesses respond to external factors?
Product-led businesses often do not change their products in response to external factors, whereas market-led businesses can adapt to consumer behavior.
What type of markets do product-led businesses exist in?
Product-led businesses exist in highly competitive markets, while market-led businesses often face little competition.
How do product-led businesses create products?
They create products based on what they think customers will want, often using intensive advertising.
What factors influence consumer purchases?
Consumers buy products based on needs/wants, social status, or as gifts for others.
What types of purchases do consumers make?
Consumers make routine/habitual purchases, impulse buys, and informed purchases.
What are examples of routine purchases?
Routine purchases include food, washing powder, toiletries, and fuel.
What characterizes informed consumer behavior?
Informed consumer behavior involves taking time to investigate a product before making a purchase.
What payment methods do consumers use?
Consumers may pay with cash, debit cards, credit cards, or store credit.
Where do consumers typically purchase products?
Consumers purchase products from retail outlets, e-commerce sites, or catalogues.
What are the advantages of telephone surveys in market research?
They allow targeting specific customers and provide immediate information that can be clarified.
What are the disadvantages of telephone surveys?
Customers may find them intrusive, and only short surveys can be conducted.
What is an advantage of postal surveys?
Customers can complete the survey at their convenience.
What is a disadvantage of postal surveys?
Surveys can be ignored as they may be viewed as junk mail.
What is an advantage of online surveys?
They can reach a large geographical area and results can be easily analyzed.
What is a disadvantage of online surveys?
Responses may be too brief to be meaningful, and internet access is required.
What is the advantage of personal interviews in market research?
They allow for two-way communication and can encourage fuller responses.
What is a disadvantage of personal interviews?
They can take a long time to conduct, and customers may refuse to answer certain questions.
What is a hall test in market research?
A product is given to customers to try, and their feedback is gathered.
What is an advantage of hall tests?
They provide good-quality feedback based on product trials.
What is a disadvantage of hall tests?
Customer opinions can be difficult to analyze, and they may feel pressured to give positive feedback.
What is a focus group in market research?
A group of customers discusses questions posed by a market researcher.
What is an advantage of focus groups?
They gather in-depth feedback from participants.
What is a disadvantage of focus groups?
Strong personalities can sway the discussion, and participants may be paid, increasing costs.
What is a consumer audit?
It continuously monitors customer habits and influences, often through recorded responses.
What is an advantage of consumer audits?
They identify customer trends over time and provide detailed feedback.
What is a disadvantage of consumer audits?
They can be expensive and may gather inaccurate or incomplete information.
What is test marketing?
A new product is launched in a regional area to monitor reactions before wider release.
What is an advantage of test marketing?
It allows for changes to be made before a wider launch.
What is a disadvantage of test marketing?
Customer preferences in one area may not represent the wider market.
What is EPOS in market research?
Electronic point of sale gathers information on customer preferences as loyalty cards are used.
What is an advantage of EPOS?
It provides vital information about consumer behavior and allows for tailored promotions.
What is a disadvantage of EPOS?
It can be expensive and time-consuming to set up.
What is a random sample in market research?
A sample picked at random from a pre-decided list.
What is an advantage of random sampling?
It shows no bias and is quick to select.
What is a disadvantage of random sampling?
The sample may not reflect the target market.
What is a quota sample?
A sample chosen by a researcher from a group with specific characteristics.
What is an advantage of quota sampling?
It is quick and can reflect the target market.
What is a disadvantage of quota sampling?
It may contain bias as it is not randomized.
What are the stages of the product life cycle?
The stages are R&D, Introduction, Growth, Maturity, and Decline.
What happens during the introduction stage of a product?
The product is launched, and sales are low.
What characterizes the growth stage of a product?
Sales increase quickly as customer awareness grows.
What happens during the maturity stage of a product?
Sales peak, and profits are maximized.
What occurs in the decline stage of a product?
Sales decrease, and the product may be withdrawn from the market.
What are some extension strategies for products?
Changing the product, promoting frequent use, altering packaging, and developing new markets.
What is an example of changing promotional methods as an extension strategy?
Using free gifts or advertising campaigns to maintain consumer awareness.
What is an example of finding new uses for a product?
Lucozade was originally marketed as a health drink but is now sold as an energy drink.
What is a product line portfolio?
Involves a business having a variety of products on sale.
Define a diversified portfolio.
A business selling products from completely different market segmentation.
What is the Boston matrix used for?
To analyze a business’s product portfolio.
What does market share represent?
The percentage of sales in the market a product makes.
What is market growth?
The overall potential for sales that the market has as a whole.
What are ‘Stars’ in the Boston matrix?
Products that have a high market share in a high-growth market.
What do ‘Cash cows’ represent in the Boston matrix?
Products that have a high market share in a low-growth market.
What are ‘Question marks’ or ‘Problem children’?
Products that have a low market share in a market with high growth potential.
What are ‘Dogs’ in the Boston matrix?
Products that have a low market share in a market with low growth.
List one advantage of having a product portfolio.
- Businesses can spread risk over multiple markets
- Newer products can replace those at the end of the Product Life Cycle
- Can increase brand awareness
- Can meet the needs of different market segments
- Cash cows can fund other riskier ventures
- Star products can improve the overall reputation of the business
List one disadvantage of having a product portfolio.
- High marketing costs due to advertising a range of products
- Can be difficult to bring out a range of products
- Poor quality of one product can impact the overall portfolio
- Unpopular products can drain profits
- Hard to manage resources across different products
What is a hypermarket?
A retailer that is open 24/7 and offers a huge range of products.
What is a convenience supermarket?
A smaller store that caters to changing customer needs but has limited choice.
What is an advantage of out-of-town retail parks?
They often attract customers due to nearby amenities.
What is a disadvantage of online retailers?
Customers cannot try or touch the product before buying.
What is cost-plus pricing?
A pricing strategy where the business calculates unit cost and adds a percentage mark-up for profit.
What is competitive pricing?
Setting the price of a product similar to competitors.
What is skimming pricing?
Setting a high initial price and lowering it over time.
What is penetration pricing?
Setting a low initial price to attract customers, then increasing it over time.
What does price discrimination involve?
Altering prices based on a discriminating factor, such as age.
True or False: Dogs in the Boston matrix can be turned into stars.
False.
What is the purpose of sales promotion in the pipeline?
To encourage retailers to purchase products from manufacturers.
What is a press conference?
An event where media are invited to receive information from a business.
What is the benefit of promotional merchandise?
Customers are reminded of the business when they use the product.
What is celebrity endorsement?
When a business pays a celebrity to promote their brand and products.
What is sponsorship in marketing?
Paying to sponsor an event or team, often seen in sports.
What is product placement?
Paying for products to appear in TV shows, films, or video games.
Why are people important to businesses in the tertiary sector?
People are crucial for delivering customer satisfaction levels in after-sales.
Who can be considered as ‘people’ in the context of customer service?
Shop floor staff, waiters/waitresses, management, security personnel, after-sales service staff, call center staff.
What impression is formed when employees interact with customers?
An impression is being formed in the customer’s mind.
How can people impact a business?
They can significantly impact the business’s reputation and the opinion of customers.
What does ‘people’ relate to in customer service?
The quality of customer service provided during interactions with the business.
Why is high-quality customer service essential for businesses?
To ensure they remain competitive and retain customers.
What is meant by ‘process’ in the context of service delivery?
The systems in place to ensure satisfactory delivery of the service to the customer.
Give an example of a process in service delivery.
Automatically sending new credit/debit cards for old ones that expire.
What does ‘physical evidence’ refer to?
The tangible aspect of delivering the service, such as the layout and cleanliness of the store.
What elements are included in physical evidence?
- Layout of the store
- Cleanliness of facilities
- Lighting
- Props used in the premises
How can e-commerce impact business operations?
It allows businesses to sell products globally and operate 24/7.
What are some advantages of e-commerce?
- Global reach
- Convenience for customers
- Cost reduction on physical premises
- Reduced staffing costs
- Wider product range
What are some disadvantages of e-commerce?
- Customer wariness of websites
- Need for internet access
- High website design costs
- Risk of website crashes
- Intense global competition
- No opportunity for customers to handle products
What role does technology play in marketing?
It facilitates access to products and services, market research, and customer engagement.
How can apps be utilized in marketing?
For easier access to products, in-app advertising, and enticing customers to download.
What is the function of social media in marketing?
To increase customer awareness and gather market research on customer preferences.
What information can EPOS systems gather?
Market research information on customer buying habits.
What are text alerts used for in marketing?
To inform customers of special short-term offers.
Fill in the blank: __________ can be used to produce high-quality marketing literature.
Photo editing
What is the purpose of computer-aided design in marketing?
To develop promotional materials and gather feedback.
What does QR technology enable customers to do?
Access further information about products/services.
True or False: Customers can shop online only during business hours.
False
