Chapter 16: Marketing #1 Flashcards
Define marketing.
Involves finding out what customers want, making a product that will satisfy their needs and persuading them to buy it. Identifying and anticipating what consumers want today and will want in future.
Define field research. Give two advantages and one disadvantage.
Primary research that involves going out into the marketplace and collecting new information directly from consumers. Advantage: Immediate up to date info, specific to the business and precisely relevant.
Disadvantage: Expensive and time consuming.
Explain three different types of field research.
Observation-Researchers watch customers in action and learn from how they behave and react in certain situations. E.g. SuperValu based layout of store on observations of shoppers.
Focus Group-Researchers bring a small group of consumers together to discuss the business and product. Aims to capture feedback. E.g. Vodafone runs feedback groups of customers
Survey-Researchers ask consumers a series of questions and the answers are recorded to find out what consumers think. Consumers contacted by phone, email, internet, face-to-face. E.g. YouTube survey’s random users before videos.
Define desk research. Give one advantage and one disadvantage.
This is Secondary research that involves using existing information that someone else has already gathered.
Advantage: Inexpensive and easy as already collected.
Disadvantage: Information may be out of date or inaccurate.
Explain three types of desk research.
Internal Reports: Information from previous sales and finance reports produced. Shows popular products and successful ideas. E.g. Coca Cola saw that Diet Coke wasn’t being bought by men.
Government publications-Info about market produced that can be bought or obtained for free. E.g. Enterprise Ireland-Export Trade Information, Census
Internet-Info on any topic for free, easy to find. E.g. Public Surveys
The four reasons market research is important.
- Market Research can save a business money in the long run by not wasting money on bad products. E.g. “New Coke” product thrown out for lack of interest.
- Reduces risk of failure as helps makes products that consumers actually want today or in the future. E.g. Spin 1038 saw how much people hated ads and ran ten songs in a row.
- Business can identify new markets-Products that consumers want that aren’t on sale so larger demand. E.g. Diet Coke for health conscious drinkers.
- Helps identify business threats-Potential threats and sources of competition spotted in advance. Can take action to neutralise. E.g. Consumers didn’t know “Coke Zero” had zero sugar renamed “Coke Zero Sugar.”
Define market segmentation.
Involves dividing up the market into clearly identifiable groups of consumers which have common characteristics. E.g. Young sporty females
Distinguish between geographic segmentation and demographic segmentation.
Geo: The market is divided into geographical areas. A business makes money by satisfying local needs. E.g. Irish Radio Stations.
Dem: The market is divided based on characteristics and demographics of the population. E.g. Nivea for Men (gender)
Advantages of Market Segmentation.
Establish Presence in the Market: Start off focusing on one segment and then expand with success. Example: Newstalk
Increase Sales: Target a previously neglected segment and increase sales. Example: Nivea for Men
Lower Marketing Costs: Only needs to develop campaign to target one segment. Example: Its4women
Define target market with an example.
Is a precise description of the consumers to whom a product will be aimed at. It is a particular segment within the overall market that the business sets its sights on. E.g. Penny’s target budget conscious consumers.
Define niche market with an example.
Niche market is a small group of potential customers within a market segment for a product. These customers have specialised needs not satisfied by mainstream products for which they will pay a higher price. E.g. Rock Music Radio Station
What is Marketing Concept?
The most important person in a business is the customer and the business must understand what the customer needs to make money. Aiming to make products that’s satisfy customer’s needs better than competitors. E.g. Brown Thomas, Personal Shoppers.
What are the three advantages of market concept?
Increased Profits: When customers have good quality products they are happy to buy more leading to increased sales.
Good Reputation: When customers are happy they will tell friends leading to good reputation.
Fewer Returns/Repairs: Customers less likely to complain and ask for returns which reduces costs.
Define marketing plan/marketing strategy
A written place taking the aims and objectives from the business plan and puts in place marketing activities to ensure these objectives are met. E.g. Coco Cola sales in decline due to low-sugar craze, introduced Diet Coke to meet sales targets.
Explain the four steps of a marketing plan with examples.
Step 1: Investigate Market: Conduct SWOT analysis to spot a gap in the market to take advantage of and make money E.g. Meteor learned phone market was growing.
Step 2: Select Target Market: Split the market into segments and target one or more of these segments. E.g. Meteor targeted youth market.
Step 3: Research Target Market: Conduct research into your target market to find out what they want. E.g. Meteor discovered young people like texting.
Step 4: Develop Marketing Mix: Have the right product, at the right price on sale in the right place. Promote in a way that appeals to target market. E.g. Meteor ads have humour to appeal to young people.
