Business topic 5 - Marketing

Question 1

What is meant by the term “Market Segment”? Name 4 examples.

Answer 1

Involves dividing the market target / niche markets into parts which have specific characteristics e.g. age / gender / income / socio-economic group

Question 2

What is the difference between primary and secondary research and give examples of each.

Answer 2

Primary (Field research) is data collected first hand. E.g. Questionnaires, Surveys , Polls, Focus groups.
Secondary/Desk research involves using data already collected. E.g. using internet, government statistics, newspapers

Question 3

What is qualitative market research and give 2 examples

Answer 3

Involves collection of data about attitudes, beliefs and intentions. Focus groups, participant observation and interviews are common methods used to collect qualitative data

Question 4

What is quantitative market research and give 2 examples.

Answer 4

Involves the collection of data that can be measured. E.g. statistical data such as sales figures and market share. Surveys and the use of government publications/existing statistics.

Question 5

Name the marketing mix (the 4P’s)

Answer 5

Product
Price
Promotion
Place

Question 6

What is meant by the term “Brand”?

Answer 6

It is the name / logo / trade mark / image / marque / identity etc. given to a good or service

Question 7

What does the term “USP” mean and name 3 products that have USPs.

Answer 7

Unique Selling Point
Examples include Toblerone, Polo mints, Terrys chocolate orange

Question 8

What is meant by the term “Product Life Cycle” and name all of the stages.

Answer 8

The stages a product passes from its earliest development until it is no longer available on the market.
Introduction - Growth - Maturity - Saturation - Decline

Question 9

Suggest two reasons why packaging is important.

Answer 9

1. Protection of the product
2. Increased credibility and makes the customer trust your company and the product you sell.

Question 10

What does the term “extension strategy” mean and give 3 examples.

Answer 10

Involves a number of methods businesses might use to prolong the life cycle of their product. E.g. new flavours, new packaging, new promotions, sell in new markets, new feature

Question 11

What is penetration pricing?

Answer 11

launching a product with a very low price in order to encourage consumers to try it.

Question 12

What is skimming pricing?

Answer 12

Charging a high price initially, and then lowering the price over time.

Question 13

What is cost plus pricing?

Answer 13

Calculating the cost of producing the item and then adding on the percentage profit required by the company

Question 14

What is psychological pricing?

Answer 14

where a business would charge 99p instead of £1, or £9.99 instead of £10 to make items seem cheaper to customers.

Question 15

What is discrimination pricing?

Answer 15

Where different customers are charged different prices for the same products or services.
For example train tickets are cheaper for U16s.

Question 16

What is competitive pricing?

Answer 16

Where a business bases its selling prices on the prices of its direct competitors rather than, for example, its own costs. Usually pricing their products lower than competitors.

Question 17

What is loss leader pricing?

Answer 17

Where a product or service is sold at a loss (less than it cost them to produce) in order to bring customers to a business

Question 18

What does above-the-line promotion mean and give 3 examples.

Answer 18

Paid for communication such as advertising that uses the mass media such as television, newspapers, billboards, cinema, radio

Question 19

What does below-the-line promotion mean. Give examples

Answer 19

an advertising strategy where products are promoted in media other than mainstream radio or television.
Examples - direct mail campaigns, trade shows, catalogs, and targeted search engine marketing.

Question 20

Describe the different distribution channels used by businesses.

Answer 20

The routes which goods follow between the manufacturer and the consumer.
Manufacturer – Consumer
Manufacturer – Wholesale – Consumer
Manufacturer – Retailer – Consumer
Manufacturer – Wholesale – Retail – Consumer

Question 21

What is meant by
“E-commerce” and
“M-Commerce”?

Answer 21

E-commerce refers to buying goods and services online via the internet, m-commerce is buying through wireless hand held devices

Question 22

What is meant by
“The Sales Process”?

Answer 22

Involves a series of steps taken from when the potential buyer meets the prospective seller until after the final sale is made. This includes offering good customer service