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Business AS level 9609 > Chapter 17: The nature of marketing > Flashcards

Chapter 17: The nature of marketing Flashcards

1
Q

Marketing objectives

A

The goals set for the marketing department to help achieve corporate objectives

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2
Q

4 P’s and 4 C’s

A

Product - Customer solution
Price - Cost to customer
Place - convenience to the customer
Promotion - Communication with the customer

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3
Q

Marketing

A

Identifying and meeting customer needs and wants profitably by getting the product at the right price, right place at the right time

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4
Q

Corporate objectives

A

Well-defined and realistic goals that are set for the whole company. These produce the marketing objectives

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5
Q

Marketing involves

A

Market research
Product and package design
Pricing, advertising and distribution
Customer services

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6
Q

Marketing should result in

A

Increased market share
Increase in total sales
average goods sold per customer
Shopping frequency by loyal customers
Customer loyalty
number of new customers
customer satisfaction
brand identity

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7
Q

Marketing objectives should be

A

Linked to achieving corporate objectives
Determined by senior management
Realistic, motivating, achievable, measurable and communicated to all departments

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8
Q

Why are marketing objectives important?

A

Provide a sense of focused direction
Can help measure business success
They can be broken down into regional and product sales targets
They form the basis of marketing strategy

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9
Q

Marketing strategy

A

A plan of action detailing how a business intends to achieve its marketing objectives by creating a competitive advantage

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10
Q

Examples of marketing strategy

A

Penetrating existing markets
Entering new markets in other countries
Developing new, or updating products

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11
Q

Coordination of marketing with the finance department

A

The finance department will rely on marketing’s sales forecasts for cash flow and budget planning.

Finance must secure adequate capital to cover the approved marketing budget for promotional expenses.

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12
Q

Coordination of marketing with the HR department

A

HR will use sales forecasts to develop a workforce plan, which may include hiring more sales and production staff to boost sales.

HR must ensure the recruitment and selection of qualified and experienced workers

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13
Q

Coordination of marketing with the operations department

A

Market research data will play a key role in new product development

The operations department will use sales forecasts to plan the capacity needed.

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14
Q

Demand

A

The quantity of a product that consumers are willing and able to buy at a given price in a specific time period.

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15
Q

Supply

A

The quantity of a product that firms are prepared to supply at a given price in a specific time period

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16
Q

Equilibrium price

A

The price level at which demand is equal to supply

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17
Q

Demand curve

A

A downward slope that shows, for normal goods, the lower the price the more the demand. It has an inverse relation with price.

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18
Q

Supply curve

A

The higher the price the higher the quantity supplied. It has a positive relation with price.

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19
Q

Market segment

A

A subgroup of a market iwhere customers have similar characteristics

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20
Q

Industrial market

A

The selling of products from one business to another, aka B2B

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21
Q

Consumer market

A

Selling of products from businesses to consumers, aka B2C

22
Q

Customer/market orientation

A

An outward-looking approach that bases product decisions on consumer demand as established by market researcher

23
Q

Benefits of customer orientation

A

Low chances of newly developed products failing

More profitable products with longer lifespan because it is based on customer needs

Constant feedback means market research never ends

24
Q

Product Orientation

A

An inward-looking approach on making products that can be made for a long time and then trying to sell them

25
Q

Benefits of product orientation

A

Invents and develops products
High concentration on high-quality goods

26
Q

Market size

A

Total value of sales of all producers in a time period

27
Q

Importance of market size

A

Allows a marketing manager to see if its worth entering a market
Allows a business to calculate its own market share
Market growth/decline can be identified

28
Q

Market growth

A

Percentage change in the total market (volume or value) size over a time period

29
Q

The rate of market growth depends on

A

The country’s economic growth
Changes in consumer income/taste
Development of new markets
Technological changes boosting market sales
Whether the market is saturated

30
Q

Brand leader

A

The brand with the highest share of the market

31
Q

Implications of an increase in market share

A

Sales rise faster than competitors
Possibility of increasing the price/profit per unit
Less costs due to more sales
More competition from new businesses entering the market

32
Q

Implications of a decrease in market share

A

Sales will increase slowly
Competitors may decrease prices to increase sales
Lower prices mean lower profit per unit

33
Q

Consumer products

A

Goods/services sold to end users

34
Q

Industrial products

A

Goods/services sold to businesses

35
Q

the 3 consumer products

A

Convenience- purchased frequently (water)
Shopping: Not bought frequently, requires planning (microwave)
Specialty: Often expensive with strong brand loyalty (phones)

36
Q

The 3 industrial products

A

Material and components: raw materials
Capital items: Equipment, machinery and vehicles
Services and supplies: Business services and utilities

37
Q

Mass marketing

A

Selling standardised products in the same way to the whole market

38
Q

Advantages of mass marketing

A

High sales can lead to lower average costs
Cost advantages can lead to lower prices for consumers
Can result in extensive publicity

39
Q

disadvantages of mass marketing

A

Undifferentiated products can be unappeaing
Low prices do not create a premium brand image
Some changes could lead to a fall in demand

40
Q

Niche marketing

A

Identifying/exploiting a small segment of a larger market by differentiating products to suit that segment

41
Q

Advantages of niche marketing

A

Small businesses can survive in markets not dominated by big businesses
An unexploited niche has no competitors
Exclusive marketing/products create status/image

42
Q

disadvantages of niche marketing

A

Do not allow economies of scale
Limited growth because of few customers
Businesses are vulnerable to market change
Profitable niche markets attract competitors

43
Q

Market segmentation

A

Identifying customers with common needs in a market and marketing different products to those customers

E.g computer manufacturers make home and gaming computers but also laptops for people who travel

44
Q

Consumer profile

A

A quantified picture of a business’s consumers, showing data about age, income, location, gender and social class

45
Q

Methods of Market Segmentation

A

Geographic: Cultural, social and climatic differences
Demographic: age, gender, income, social class
Psychographic: lifestyles, personalities, values

46
Q

Advantages of market segmentation

A
  1. Businesses can define their target market precisely
  2. Identifies market gaps
  3. Different marketing strategies for different consumers
  4. Small firms can specialise in one market segment
  5. Price discrimination can increase revenue and profits
47
Q

Disadvantages of market segmentation

A
  1. Research/development costs can be high
  2. Promotional costs can be high
  3. Product/inventory costs can be high
  4. Excessive specialisation can backfire if consumers change their buying habits
  5. Extensive market research is needed to identify market segments
48
Q

Customer relationship marketing (CRM)

A

Maintaining customer loyalty through personalised experiences that build good customer relationships

49
Q

Methods of building long-term relationships with customers

A

Targeted marketing: Giving the customers what they want
Customer service and support
Regular communication with customers
Using social media

50
Q

Benefits of CRM

A

Results in higher sales
It is a sustainable strategy for long-term
Cost-effective
Easier to maintain loyal customers than to get new ones

51
Q

costs of CRM

A

IT systems and software are needed
Employees need to be trained to respond to customer feedback
External marketing consultancy can be costly
Requires customer base

Business AS level 9609 (19 decks)

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