Chap 16- Marketing Flashcards
Factors affecting demand
Price Substitute available Season Necessary or luxury Incomes Changes in taste and fashion
Factors that affect supply
Price Cost of production Taxes Subsidies Technology Weather conditions and natural factors
what is market equilibrium
Market price that equates supply and demand for a product
how to create value
- luxury environment
- awesome packaging
- increase brand name
- create a USP
Advantages of mass marketing?
- economies of scale
- less risky
Advantages of niche marketing?
- may be able to survive
- can raise prices if less competition
- large firms can use niche products for status and image
What is consumer profile?
A quantified picture of a firms consumers, showing age, gender, income levels, location.
What are the ways to segment market?
1- Geographic- based on locations. No wine in muslim countries, no ACs in antartica.
2- demographic differences. Age, gender, family size, ethnic background. Toys will be aimed at kids, makeup at women, large houses for large families.
3- psychographic factors- lifestyles, personality, attitudes. Eg. Diet consious ppl, feminisms and activists etc.
Why is market research needed?
1- to predict demand
2- to reduce risks
3- to explain sales patterns
4- to assess the most favoured styles, products etc.
What are the applications of PED
- setting prices
- making more accurate sales forecasts
Limitations of PED?
- it assumes nothing else has changed
- becomes outdated quickly
- not easy to calculate PED always
