management of marketing Flashcards
what is the purpose of marketing
to help raise awareness of products/services
help raise organisation’s profile on market
encourage customers to buy
target new customers and existing ones
allow an organisation to know what customers want
allow an organisation to meet its strategic objectives eg increase profits, increase market share, extend life of a product
what do different organisations use marketing for
private sector businesses would want to increase profitability
charities may want to increase donations/raise awarerness
police would want to raise awareness of certain campaigns
NHS would want to raise awareness if campaigns eg anti smoking
local authorities may want to increase use of certain facilities
what is product led
this is where the organisation manufactures the product and then tries to sell it off ti customers. they don’t do any market research. product research and product testing is key
what is market led
where the business puts the customers needs at core of business. market research and market testing is key
what are the advantages of market led
more likely to produce products that customers want
more able to anticipate and meet changes in customer demands
more able to make changes
what is market segmentation
the process of breaking down the market into groups of customers who have similar characteristics
how can you segment a market
into; age gender marital status religion music taste income occupation hobbies sports
what are the advantages of market segmentation
if you know who your target market is then you can use appropriate sampling for market research, which will allow you to finds out effectively tailor your product to their needs/services
the organisation can offer its products/services within an affordable price range for its target audience
be able to use appropriate method of distribution
highlights gaps in the market
segmentation means that organisation doesn’t have to waste money in advertising on promotional activities that don’t reach their audience
what is market research
systematic gathering, recording and analysing of data about an organisation’s products/services and its target market
what is the need for market research
able to anticipate changes in market
identify changes in customers tastes
identify who is buying the product
help stay ahead of competitors
identify if promotion is appropriate
what are the two types of market research
primary (field) research
secondary (desk) research
what are the sources of information
internal
external
primary
secondary
what are the advantages and disadvantages of primary information
adv
sources are more reliable
carried out for a specific purpose of business therefore more relevant
disadv
time consuming to collect, gather and analyse
expensive as you might need to pay for interviewer and materials
what are the advantages and disadvantages of secondary research
adv
more widely available to collect than primary
less cost effective than primary
disadv
collected for another business’s purpose so might not be as relevant
might be biased therefore inaccurate
what are the advantages and disadvantages of internal research
unique to org therefore relevant
source is known - reliable
disadv
info may not be up to date therefore unreliable
what are the advantages and disadvantages of external research
more info can be accessed through sources
disadv
source might not be known - unreliable
info may be out of date - unreliable
what are the types of information`
written oral graphical pictoral numerical quantative qualitative
what are the advantages and disadvantages of written
kept for future reference
facts can be passed onto oral
disadv
may be unable to obtain clarification
what are the adv and disadv of oral
immediate response given
questions can be asked
body language can be monitored
disadv
points misinterperted
requires careful listening skills
what are the advantages and disadvantages of pictoral
info presented attractively
sig points - highlighted
disadv
complex info - not communicated
factual info not communicated easily
what are the advantages and disadvantages of graphical
comparisons made easily
complex info communicated effectively
disadv
user needs to be able to interpret info easily
what are the advanatages and disadvantages of numerical
financial info easily calculated
calculations can be carried out
disadv
requires numeracy skills
what are the advantages and disadvantages of quantative
info can be compared and measured
disadv
doesnt take into account internal and external factors
what are the advantages and disadvantages of qualitative
can provide deeper info for user
disadv
can be difficult to measure two people’s opinions
what is secondary research
carried out by a researcher using secondary info in form of published sources
originally produced by someone else other than researcher
what is the advantages of secondary research
wide range of info that can be accessed - making decisions more informed
info is cost effective to collect
comp’s information is available
saves a lot of time compared to field research
what are the disadvantages of secondary research
info not unique
info can be out of date
difficult to test accuracy of info
info may be biased `
what is primary research
carried out by a researcher for a specific purpose. first hand information
researcher goes out to conduct research themself
what are the advantages of primary
info is reliable - collected first hand
info more relevant as you have collected it for specific purpose
up to date
what are the disadvantages of primary
can be expensive to carry out as you might have to pay for interviewer
can be very time consuming as it has ti be created, generated and analysed
what is a personal interviewer
face to face interview
can be held in street or home
what are the advantages and disadvantages of personal interviews
two way communication
researcher can encourage respondent to answer
mistakes and misunderstandings can be clarified
disadv
can be expenisve
low response rate
what is a focus group
involves specially selected groups of people
led by experienced chair person
what are the adv and disadv of focus group
qualitative information in form of opinions
feelings and attitudes gained
disadv
can be difficult to analyse qualitative info
what are telephone surveys
involves market researcher phoning home numbers
what are the adv and disadv of telephone surveys
cheap to undertake
response immediate
disadv
many people think of these as an intrusion and so don’t respond
what is a postal survey
involves market researcher sending questionnaires through post
what are the adv and disadv of postal surveys
inexpensive as it doesn’t require trained interviewer
disadv
questions must be simple and easy to answer
response rate - low
what is a customer audit
certain customers issued a diary and asked to record some/all purchases
monitored by market research company
what are the adv and disadv of customer audit
accurate info can be gained if diaries kept properly
info can indicate customer trends
disadv
can be expensive method as participants usually recieve payment
can be inaccurate/incomplete
what is sampling
a group of customers selected from population who participate in market research
what are the 3 types of sampling
random
quota
stratified random
what is random sampling
respondents are picked at random from list
interviewer must interview all people who are on the list
can be time consuming as all on list must be interviewed
what is quota sampling
set number of people with certain characteristics must be interviewed
researcher must find people who meet criteria
what is stratified random sampling
sample divided into segments based on how population is divided up and then respondents are randomly selected from each sub group
researchers able to obtain sample which represent the population as a whole
gives better representation of population therefore returns more accurate results
what is included in the marketing mix
product place price people process physical evidence promotion
what is product
sales levels at research, introduction, growth, maturity, saturation, decline phases at a product’s life cycle
what do extension strategies do
used to enhance products sales and profits
what is incluxed in the development stage
idea generation, design product, produce prototype, test product, conduct test marketing and apply for trademark
what are the stages of the product life cycle
research and development, introduction, growth, maturity, saturation, decline
whats the development stage
r and d of prod
no sales/profits
high costs
what is the introduction stage
product launched heavy advertising sales being to rise sales low costs high revenue used to pay R+D costs so no profit
what is the growth stage
product gained customer awareness and sales begin to grow at faster rate.
profits grow at faster rate
what is the maturity stage
sales move toward a peak, rate of sales growth slows
high sales and high profits
what is the saturation stage
sale growths levels out neither increase/decrease
profit and sales are at highest point
what is the decline stage
still making sales but they are falling, eventually leading to withdrawal from market
profits fall with sales - losses are incurred
what are extension strategies
these are to help stop the product from falling into the decline stage eg
improve the product
change the packaging
change channel of distrubution
what is the product portfolio
firm produces what is known as the product portfolio. a successful business will have a varied product portfolio as:
it can appeal to different market segments
spreads its risk
dominate the market
can increase potential sales revenue
what is the boston matrix
used to plot range of products that an organisation offers. can help identify where products might need to be introduced/changed
what is each quadrant in terms of the product life cycle
dog - introductory stage
problem child/???? - growth
star - maturity/saturation
cashcow - decline
what do star products have
high market share in a fast growing market
what do cashcow products have
high marketshare in slow growing market
what do problem child products have
low market share in fast growing market
what do dog products have
products low market share in slow growing market
what are the disadvantages of a varied product portfolio
costs of promoting and advertising lots of different products therefore could impact profit
if one product has a bad rep, then it could impact rep of other products
maintaining varied product portfolio will involve a cost of R+D
staff require training on various features of products which can be time consuming and expensive
what is branding
name, logo, symbol that sets the business’s product apart from competitors
what are the advantages of branding
easier to launch new products with an established branded name
higher prices can be charged
customers become brand loyal
brand manufacturers can save money on marketing
what are the disadvanatages of branding
can be susciptable to fakes
one product reputation could affect all other products
advertising and R+D costs can be high
what is public relations
concerned with managing communication between an organisation and its stakeholders.
what are some examples of better public relations
improving product image and image of organisation
supporting and promoting charity
sponsoring sporting cultural events
what is the advertising standards authority
ASA is organisation that monitors all advertising sales, promotions and direct marketing to ensure they operate at the correct standard
what is the trades description act
this act states that a product must be advertised in an honest way which is not misleading to customers
what is people in the marketing mix
company’s employees are important in marketing because they are the ones who deliver the service. Thorough research is important to discover whether there are enough people in your target market that is in demand for certain types of products/services
what is process
systems and processes of organisation affect execution of service
tweaking and enhancements can come later to ‘tighten up’ a business to minimise costs + max profity
what is physical evidence
physical presence of business and establishment concept is branding
your immediately know what their presence is in market place as they usually marketleaders and have established physical evidence as well as psychological evidence in their marketing
what is own labels/own brands
own label/brand refers to a retailer’s own product which may be the retailer’s own name eg tesco value, asda smart price
what are the advantages of own brands
requires little advertising
tend ti be cost effective
what are the disadvantages of own brands
seen to be inferior qualities to branded quality
what is price
these are the pricing strategies and factors that influence an org to use these strategies
what are the pricing strategies
cost - based loss leaders skimming penetration promotional destroyer premium competitive discrimination
what are the factors influencing price
competitors prices cost of production where product is sold market segment state of economy profit expected
what is cost based pricing
cost of making each unit is considered before adding a % as profit. covers cost of production and ensures a profit on each unit sold
what is competitive pricing
price lower than competitors, so it entices customers to buy their product instead of competitors
what is skimming pricing
high price is charged when product is launched into market . after a while they will lower price to match competitors. large profits can be made due to lack of competiton in area
what is penetration pricing
low price is charged when product is just launched. After a while business raises price to be in line with competition. allows prod to gain attention and loyalty before increasing
what is promotion pricing
firm lowers price for limited period of time then raises it again to previous level. helps to attract customers and loyalty before raising price
what is discrimination pricing
different price offered for product as times change. Allows firm to take advantage of higher profits at different times
what is destroyer pricing
large companys drop price so low that competitors cant compete with, so then those businesses fall out of the market. after this happens, then the company raises price to make profit. tis illegal
what is loss leader pricing
firms lower certain prices so low that they are making a loss on each unit of output. Entices customers to buy other products at a higher price. Hopefully gains customer loyalty and allow business to off set loss by making higher profits
what is place concerned with
how product gets from manufacturer to customer
what are the 3 channels of distribution
direct selling,
retailer function,
wholesaler function
what does the channel of distribution depend on
product being sold
finance of busines
desired image of product
product’s life cycle
what is the wholesaler function
buy large quantaties off manufacturuer than sell in bulk to retailer sometimes directlu to customer
what are the adv and disadv of wholesaler
storage costs reduced as you buy in bulk
may label and package goods which also reduces cost
dont have to worry about excess stock not selling therefore reduced risk
disadv
manufacturer loses control over presentation of product
relationship with customer hard to develop
difficult to notice buying patternd
less profit for manufacturer as they need to sell at lower price to allow for wholesaler/reatiler to make profit
what is the retailer function
retailer has own distribution network and buy straight from manufacturer. big supermarkets use this function
what are the adv and disadv of retailer
established customer base across country - saves you effort n distribution
established online presence
will deal w/ after sales service
disadv
lose out on profoits as they have to buy it off you at a cheaper price
lose direct relationship with customer
lose control of presentation of product
what is direct selling
carried out in number of ways - e tailing, s tailing, personal selling, direct mail, mail order
what are the adv and disadv of direct
get to keep all of profits
keep control of how product is presented
easier to track buying patterns
close relationship with customer
disadv
expenisve for holding all stock incurr all packaging costs
what is promotion
3 aims - persuade people to buy
inform customers
reminding product exists
what are the 2 types of promotion
above line - tv newspapers to reach mass audience
lot of waster
below line - directly controlled by business
sales promotion
what is above the line
different ways org use adverts
what are the examples of above the line
informative adverts - use to persuade customers to buy product /service and to inform people of service
product placement - firm pays its product to be used in films/tv
product endoresemennts - celebrities paid to use product
what is below the line
into and out of pipeline
what is into pipeline
promotions manufacturer will offer to retailer/wholesaler to sell stock
what is outof pipeline
retailer offers promotions to encourage consumer to purchase products
what are examples of into pipeline
point of sale material - display material given to retailer such as posters and stands to make it more attractive
sale/return - distributor will take back any unsold stock/ reduces costs and risk
staff training - particularly with tech and machinery so retailer feels confident dealing w/ customers
what are examples of out of pipeline
free samples - allow customers to try product before committing to larger purchase
loyalty schemes - to entice return custom where customers can work towards something free.
vouchers - can entice customers to return
special offers - bogof or short term reductions in price.
