Chapter 10- Marketing, Competition + The Customer Flashcards
marketing
Identifying what the customer wants and satisfying them profitably
Customer
Person, business or other organisation which buys goods or services from a business
Describe marketing in a large public limited company
The marketing director will have people responsible for:
Market research of new products
Sales
Promotion
Distribution
Draw the marketing department of a large PLC
What is the sales team responsible for/contain
Sales of the product
There are separate for each region distributed to
If exported, export team
Describe the market research team
They find out customer needs, market chances and impact of competitors actions
They report to the marketing director who will use information to make decisions
Describe the role of the promotion team (4)
They organise and advertises products
Arranged for the production of the adverts eg. filming
Decide on campaign styles
Have a marketing budget and stick to it
What marketing team has a budget
Promotion
Describe the distribution team
They are responsible for transporting goods to the market
Customer loyalty
Existing customers buying products from the same business
Customer relationships
Communicating with customers to encourage them to become loyal to the business and its products
What are the roles of marketing (5)
Identify customer needs
Satisfy customer needs
Maintain customer -loyalty+relationships
Gain information about customers
Anticipate changes in customer needs
Identify customer needs
What products/services customers want
The price they are willing to pay
Where /how they want to by the goods services
What after-sale services they might want
Satisfy customer needs
To sell goods and services profitability
Customers want right product, right place, right price
If needs not satisfied, they may go to competitors and the business may lose profit and close down
What are after-sales
Asking if you are happy with your product.
Installation
Returns/refunding
Maintain customer loyalty
By building customer relationships, check in on them ensures success.
Important to focus on keeping customers and not just new ones.
Eg. Loyalty cards
Gain information about customers
By building relationships
Know what they want and when their wants change
Needs and wants, e-mail, phone number, name etc.
Means market research can be used to analyze why and how customers use and buy products
Anticipate changes in customer needs
Identifying new trends in customer demands/gaps in market so the business can produce goods or services not currently available.
What does the success of the marketing department enable the business to do (7)
Raise customer awareness of a product/service
Increase revenue and profitability
Increase/maintain market share
Maintain/improve the image of products/business
Target a new market/market segment
Enter new markets at home or abroad
Develop new products or improve existing products
Why do businesses need to understand market changes and 2 eg.
So that they can change their goods and services to respond to market changes
Rapid changes: cellphones
Slow: cereal
Why/how could customer/consumer spending patterns change (4)
Consumer tastes in fashions can change - trends
Technology can change - out with the old in with the new
Changes in incomes-economy good = sales good vise versa, the more you earn the more you spend
Aging populations - anti aging creams more in demand
What is a dynamic market
A market that all businesses operate in, ever changing
Power and importance of changing customer needs
How businesses respond to changing customer needs result in the outcome of the business. Failure to satisfy results in business failure. Businesses that have done their research know what the changes are and respond to them, resulting in successful business
Why would a business need to respond to changing spending patterns and increased competition
To maintain level of sales and market share.
Why have some markets become more competitive (3)
Globalisation
Internet/e-commerce
Improvement in transport
How can a business respond to changing spending patterns and increased competition (4)
Maintain good customer relations
Keep improving existing products
Keep costs low
Bring out new products to maintain interest
What is meant by a market
Total number of customers+potential customers+sellers for a particular good/service.
Can be measured by total number of sales or value of sales of goods and services
Can be mass or niche
What is a Mass market
Where there is a very large number of sales of a product
What is a Niche market
Small, usually specialized segment of a much larger market
What is a a market segment
An identifiable sub-group of a whole market in which consumers have similar characteristics/preferences
What are the advantages of mass marketing (4)
Total sales are high
Businesses can benefit from economies of scale
Risks can spread
Opportunity for growth+large sales potential
What are the disadvantages for mass marketing(3)
High levels of competition
High costs of advertising/promotion
Standardized products+services don’t cater to all needs- leads to lost sales
What are the advantages of Niche marketing (3)
Larger businesses focus more on mass markets, so there are fewer competitors
Customer needs can be targeted leading to good customer loyalty +relations
Limited demand may suit a business that is unable to produce on large scale
USP
What are the disadvantages of Niche marketing (3)
Limited sales potential
No spread risks
Increased interest in Niche markets may attract larger companies
What is segmentation
The process of dividing the total market into smaller groups of people who share similar characteristics
Why are market segments used
It makes marketing expenditures cost effective-all marketing efforts go here and product is produced to meet specific needs
Higher sales+profits for business due to cost effective market
Helps to identify market segments with unmet needs-offers opportunities to increase sales
Ways you can segment a market(6)
Socio-economic groups
Age
Lifestyle
Use of product
Gender
Region/location
What are the benefits of market segmentation to the business
Helps sell more products as different brands can be made, each aimed to a different market segment
Helps the business identify gaps in the market-can then produce a suitable product and increase sales
Influence how products are presented+where they are sold to get max sales
How can a business decide which method of market segmentation should be used
Making a detailed analysis of the market+size of each potential segment I. Terms of consumers and likely sales.
Whichever one would suit the company brand+image
Take into account the cost of entering each segment
