Management of marketing (Unit 2) Flashcards
1
Q
What is market segmentation
A
Market segmentation involves putting potential customers into groups based on specific criteria or characteristics.
2
Q
What criterea are commonly used to segment the market
A
A business can use many different criteria to segment the market:
age - consumers are divided into groups based on age brackets, e.g. 13-18 or over 55;
gender - consumers are grouped together based on the gender that they identify with as commonly used in the cosmetic and clothing markets;
income level - consumers are grouped together based on how much disposable income they have;
lifestyle/hobby - consumers who have a particular lifestyle or hobby are grouped together, e.g. vegetarians or gamers;
religion - consumers are grouped together based on their religious or cultural beliefs.
3
Q
What is target marketing
A
After segmenting the market the business will choose what group to target their products/services to.
4
Q
What are the benefits of target marketing
A
products or services will be better suited to the target market’s needs or wants, leading to improved customer satisfaction;
businesses will choose appropriate pricing that appeals to their target markets, leading to an increase in sales;
businesses will sell their products in appropriate places where the target market shops, leading to an increase in sales;
there is a decreased chance of product failure, leading to the likelihood of a reduction in wasted investment by businesses.
5
Q
What is market research?
A
Market research is the process of gathering, recording and analysing data about customers, competitors and market trends.
6
Q
What is the general purpose of market research
A
Conducting market research allows a business to make better informed decisions relating to the marketing of their product.
7
Q
What are some particular reasons a business may use market research
A
identifying what the target markets should be for their products or services;
finding out what the target market’s needs and wants are so as to design products that satisfy them;
finding out how much the target market would be willing to pay for products so as to set appropriate pricing;
gathering information about competitors, allowing them to gain competitive advantages.
8
Q
What are the two types of market research
A
Field research (Primary) and Desk research (secondary)
9
Q
What is field research
A
Field research involves a business gathering brand new information themselves using methods such as face-to-face interviews and focus groups. This type of research collects primary information.
10
Q
What are the advantages of field research
A
data collected is brand new and up-to-date;
data is not available to competitors;
the research is tailored to the specific requirements of a business, meaning that the data gathered is highly relevant.
11
Q
What is desk research
A
Desk research involves the use of pre-existing data that has been gathered by someone else. This type of research collects secondary information.
12
Q
What are the disadvantages of field research
A
it can be an expensive type of research compared to desk research;
it can be a time-consuming process, meaning that decisions cannot be made quickly.
13
Q
Name 6 methods of field research
A
Personal interview
Telephone survey
Postal survey
Online survey
Hall test
Focus group
14
Q
Describe a personal interview (field research)
A
the researcher conducts a face-to-face interview with the respondent using a questionnaire containing standardised questions.
15
Q
Describe a telephone survey (field research)
A
the researcher conducts an interview with the respondent over the telephone using a questionnaire containing standardised questions.
16
Q
Describe a postal survey (field research)
A
a questionnaire is sent through the post to respondents who mail it back upon completion. Postal surveys can cover a wide geographical area and can target specific target markets based on postcode; however, they have a very low response rate as many people view it as junk mail.
17
Q
Describe an online survey (Field research)
A
a questionnaire is hosted on the internet for respondents to complete. Many online surveying tools such as Survey Monkey will provide automatic analysis, graphs and summaries of the data collected; however, this method relies on people having internet access.
18
Q
Describe a hall test (field research)
A
respondents are given a sample of the product to try and their feedback is gathered.
19
Q
Describe a focus group (field research)
A
a group of volunteers from a target market are brought together to discuss a product. The researcher will record what is being said.
20
Q
Name 5 common sources of desk research
A
government reports and statistics (such as census data);
reports produced by market research companies such as Mintel;
competitors’ websites;
trade magazines and journals;
reputable newspapers.
21
Q
What are the advantages of desk research
A
it is a relatively inexpensive way of gathering and obtaining data;
it is relatively quick to gather compared to field research, meaning that decisions can be made quicker;
large amounts of information and data are available at little to no cost.
22
Q
What are the disadvantages of desk research
A
the data gathered could be out of date, leading to poor decisions being made;
the same information is also available to competitors;
the information might contain bias.
23
Q
What is observation (field research)
A
A method of market research conducted by watching consumer behaviour.
24
Q
What are the advantages of a face to face interview
A
Two-way communication
Researcher can encourage respondent to answer
Mistakes and misunderstandings can be cleared up right away
25
What are the disadvantages of a face to face interview
Personal interviews can be expensive
Researchers have to be selected and trained
Home interviews unpopular with consumers
Time consuming
26
What are the advantages of a postal survey
Inexpensive
No interviewer training needed
27
What are the disadvantages of a postal survey
Questions must be simple and easy to answer
Response rate very low, incentives sometimes needed
28
What are the advantages of a focus group
Qualitative information provided in the form of opinions, feelings and attitudes
Topics can be explored in some depth
29
What are the disadvantages of a focus group
Can be difficult to analyse qualitative information
Expensive
30
What are the advantages of a hall test
Qualitative information provided in the form of tasting or demonstrations
31
What are the disadvantages of a hall test
Respondents may be too positive as they feel obliged to give favourable opinion
32
What are the advantages of a telephone interview
Can reach a large geographical area
Inexpensive
33
What are the disadvantages of a telephone interview
Response rate may be low as people may view it as a “nuisance call”
34
What are the advantages of an online survey
Large sample sizes
Inexpensive
35
What are the disadvantages of an online survey
Limited to people with internet access
36
What are the advantages of observation
Quantitative information gathered
Real life and behaviours in action
37
What are the disadvantages of observation
Samples are often random and not representative of all customers
Only shows actions, does not explain attitudes and feelings
38
What is the marketing mix/ 4ps
The marketing mix is the name given to the key decision-making areas required in the marketing of a product or service.
39
List the 4 parts of the marketing mix
Product
Price
Place
Promotion
40
Why do customers buy a product
Customers buy a product to meet a need.`
41
Describe the first stage in developing a product.
Conduct market research to identify a need or want of consumers.
42
Describe the second stage in developing a product
Idea generation– Research and Development departments try to innovative and design products that are new or better than existing ones.
43
Describe the third stage in developing a product
Development– Businesses aim to have an innovation in their new product that they can point to as a USP (Unique selling point).
44
Describe the fourth stage in developing a product
Prototypes and testing–
Prototypes are made and then undergo tests to ensure the product is safe, reliable, fit for purpose and one that customers can and will use.
45
Describe the fith stage in developing a product
Modifications– After seeing the prototype or early versions in use, alterations can be made to improve the product.
46
Describe the sixth stage in developing a product
Patents and copyrights– Some products are registered for patents to protect the design from imitation by competitors.
47
Describe the seventh stage in developing a product
Launch to market– Finally the product is put into production and a marketing and advertising campaign is launched to introduce and sell the product to customers.
48
Name the 4 key stages of the product life cycle
Introduction
Growth
Maturity
Decline
49
Describe the introduction stage of the product life cycle
The product is first launched onto the market.
Sales are low and slow as very few consumers are aware of the product.
Heavy advertising will be required to make consumers aware of the product.
Most products make a loss due to low sales and high advertising costs.
50
Describe the growth stage of the product life cycle
Sales begin to rise quickly as more consumers become aware of the product and have been persuaded to buy it.
Heavy advertising is still required.
Most products begin to become profitable by the end of this stage
51
Describe the maturity stage of the product life cycle
The product has been on the market for a while and has an established customer base.
Sales of the product reach their peak.
As the product is now well established, less advertising is required.
Due to high sales and a reduction in advertising costs, profits will reach their peak.
52
Describe the decline stage of the product life cycle
Sales of the product fall quickly as the product has been on the market for a long time and newer products have been released which consumers are buying instead.
Profits also fall due to decreasing sales. The business will withdraw the product from the market before it starts to become unprofitable.
53
What is a brand
A brand can be a name, symbol, logo, slogan or unique design that a business can use to give their products a strong identity and make them easily recognisable by consumers.
54
What are the advantages of branding
consumers tend to perceive branded goods as being of higher quality;
customers will become brand loyal, meaning that they will only buy that brand;
customers are often willing to pay a higher price for branded goods;
costs and risks of launching a new product are reduced as consumers are already aware of the brand.
55
What are the disadvantages of branding
establishing a brand can be a very expensive and time-consuming process;
the entire brand could be damaged by one poor product in the range;
branding goods makes them easy to copy for counterfeiters.
56
What are extension strategies
When a product reaches the decline stage, a business can act to extend its life cycle. There are a number of extension strategies that they can use to prevent their product from becoming obsolete.
57
Name 7 extension strategies
Change product
Change price
Change place
Change promotion
Chnage packaging
Change usage
Change name
58
Describe the change product extension strategy
New and improved versions of the product can be released… version 2.0 and then version 3.0.
59
Describe the change price extension strategy
Price can be lowered to allow new customers to buy it.
59
Describe the change place extension strategy
Products can be sold in different countries or territories to gain more sales.
59
Describe the change promotion extension strategy
Different advertising or sales promotion techniques can prolong the life of the product, giving it a new image.
59
Describe the change packaging extension strategy
The style of the packaging may be changed to give the appearance of a new and improved product.
60
Describe the change usage exdtension strategy
Existing customers can be encouraged to buy more of the product or to use it in a different way. For example breakfast cereals used advertising to show consumers eating cereal at different times of the day.
61
Describe the change name extension strategy
If a product has suffered from bad publicity and sales are falling, a tried and tested technique is to simply change the name of the product.
62
Why is packaging a necessary cost for all businesses selling products
protecting products from being damaged during transportation
helping to keep products fresh
providing legally required information, e.g. nutrition.
63
How can packaging help with marketing of a product
packaging will be designed to reflect product branding, e.g. choice of colours and fonts;
packaging will be designed to appeal to the target market, e.g. choice of images and materials.
64
What are the benefits of effective packaging
Attractiveness and increased sales
Brand Recognition
Protection
Reduced costs
Preservation of freshness
Promotional opportunities
Regulatory information
65
What are the disadvantages of poor packaging
Increased costs
Negative impact on brand
Negative environmental impact
66
Describe in detail the attractiveness and increased sales benefit of effective packaging
Well-designed and attractive packaging can enhance the product's appeal, capturing the attention of consumers and influencing their purchasing decisions.
67
Describe in detail the brand recognition benefit of effective packaging
Packaging helps in creating brand recognition and differentiation in a crowded marketplace. Unique and distinctive packaging can make a product stand out from competitors, reinforcing brand identity.
68
Describe in detail the protection benefit of effective packaging.
Packaging provides protection during transportation, reducing the risk of damage and minimising associated costs. It ensures that the product reaches customers in good condition, enhancing customer satisfaction.
69
Describe in detail the reduced costs benefit of effective packaging
Effective packaging might involve reduced packing materials such as cardboard and plastic, reducing production and transportation costs.
70
Describe in detail the preservation of freshness benefit of effective packaging
Proper packaging helps to maintain the freshness and quality of perishable goods, extending their shelf life and ensuring customer satisfaction.
71
Describe in detail the promotional opportunities benefit of effective packaging
Packaging serves as a platform for promotional messaging and advertising. Eye-catching designs, logos, and taglines on the packaging can effectively communicate the product's features and benefits.
72
Describe in detail the regulatory information benefit of effective packaging
Packaging provides space for legally required information, such as ingredient lists, nutritional values, safety warnings, and recycling instructions. It helps businesses comply with regulations and provides transparency to consumers
73
Describe in detail the increased costs disadvantage of poor packaging
Poor packaging choices may result in higher costs, such as rework, damage during transit, or customer returns.
74
Describe in detail the negative impact on brand disadvantage of poor packaging
Consumers may view the product as poor or inferior quality.
75
Describe in detail the negative environmental impact of poor packaging
Packaging that is not recyclable or environmentally friendly can harm the environment and lead to negative publicity. Increasingly, consumers are concerned about sustainability and prefer brands that demonstrate environmental responsibility
76
What is price (marketin mix)
Price is how much money a business charges their customers to buy their goods or services.
77
Why is price important?
This is because the most important factor that many consumers consider when buying a product is the price. Consumers will only buy a product if they feel they are getting value for money - that is a good quality product at a reasonable price.
78
What are the factors a business must consider when choosing a price
Cost of buying or producing the product
Amount of profit to be made
Price charged by competitors
Quality of the product
Price target market will pay
Government restrictions on pricing
79
Further desribe the factor of choosing a price: "Cost of buying or producing the product"
the business will have to ensure that the price is higher than the costs to buy or make the product to ensure that a profit is made on each product sold.
80
Further describe the the factor of choosing a price: "Amount of profit to be made"
the business will price the product higher or lower depending on the level of profit it wishes to make on each product sold.
81
Further describe the factor of choosing a price: " Price charged by competitors"
the business needs to consider whether to match the price charged by competitors or choose a different pricing strategy to stand out from the crowd.
82
Further describe the factor of choosing a price "Quality of the product"
the price set by the business must reflect the quality of the product. If the business charges a high price for a poor quality product, the customer will feel that they have been ripped off.
83
Further describe the factor of choosing a price: "Price target market will pay"
the business must choose a price that is acceptable to their target market otherwise they will struggle to persuade customers to buy it.
84
Further describe the factor of choosing a price: "Governement restriction on pricing"
the government has legislation for specific products which restricts the minimum or maximum amount a business can charge for the product (such as the minimum unit pricing on alcohol set by the Scottish Government).
85
List the long term pricing strategies
Premium (High) price
Low price
Competetive pricing
Cost-plus pricing
86
Describe the premium (high) price strategy (long term pricing strategy)
A business will set the price of their product higher than that of their competitors. Premium pricing is used to give consumers the perception of quality and luxury. To justify the high price, the business must ensure their product is of high quality.
87
Describe the low price strategy (Long term pricing strategy)
A business will set the price of their products lower than that of their competitors. Low price is effective in markets where there is little brand loyalty and customers place price above all other decision-making factors. However, some consumers will see low price as an indicator of poor quality and will be put off from buying the product
88
Describe the competetive pricing strategy (Long term pricing strategy)
This strategy involves setting the price of the product at the same level as that of competitors. As there is no difference in competitive prices, businesses will then need to compete on other factors such as customer service and product quality to convince customers to buy from them.
89
Describe the cost-plus pricing strategy (Long term pricing)
A business first calculates the cost of making or buying one unit of the product. They then add a percentage mark-up to the cost price to calculate the selling price. For example, a business which adds a 25% mark-up on a product which costs £1 to make will sell the product for £1.25. Cost-plus pricing ensures a profit is always made on any product sold as the selling price will always be higher than the cost price.
90
List the short term pricing strategies
Price skimming
Penetration pricing
Promotional pricing
Psychological pricing
Demand orientational pricing
Destroy pricing
91
Describe the price skimming strategy
(short term pricing strategy)
The price is set high when the product is first launched. Once there are no customers left willing to pay the initial high price, the price of the product is then gradually lowered over time. Price skimming is most effective in markets where there is little to no competition.
92
Describe the penetration pricing strategy
(short term pricing strategy)
Penetration pricing is used to enter a new market. The price will be set lower than competitors to gain market share. Once a product becomes established the price will increase to be more like the market price.
93
Describe the promotional pricing strategy
(short term pricing strategy)
A short-term reduction in the price of the product. It will be widely publicised and is used to generate increased sales or to sell off outdated products. Examples include Boxing Day sales and buy one get one free (BOGOF) offers.
94
Describe the psychological pricing strategy
(short term pricing strategy)
A price is selected which makes the customer feel they are getting a much better deal than they actually are. When using this strategy, businesses will usually avoid rounding prices up to whole numbers. For example, a business will charge 99p rather than £1. Customers are more likely to buy at the 99p as their mind is tricked into thinking this is a lot cheaper than if it was priced at £1.
95
Describe the demand orientated pricing strategy
(short term pricing strategy)
This short term pricing strategy is used when demand for a product or service may change due to changes in consumer demand. This means that you may pay different prices for the same product or service at different times of day or at different times of year. For example:
96
Describe the destroyer pricing strategy
(short term pricing strategy)
Destroyer pricing is used to eliminate competition. It involves a business setting a very low price in order to attract customers away from competitors, who will struggle to match the low price and may go bust. Usually only large businesses can use this strategy as they can withstand the losses for a longer period than small businesses can. Destroyer pricing is illegal in the UK.
97
List the factors a business must consider when choosing a lcoation
Type of business
Location of competitors
Cost of premises
Availability of labour
Transport links
Government incentives
98
Describe the type of business factor of choosing a location
Depending on what the activity of the business is, some businesses need to be located in particular areas. For example, a wind farm needs to be in a rural area which is windy otherwise it will not generate much electricity.
99
Describe the location of competitors factor of choosing a location
When researching locations, a business will find out which competitors already operate in each area. A business then must consider whether it makes greater business sense to locate next to competitors or far away from them. For example, a small independent coffee shop might try to avoid areas where well-known chains such as Starbucks and Costa are already located as they might find it difficult to compete with them. However, a shopping centre food court might attract lots of people to it so setting up next to competitors might result in greater sales.
100
Describe the cost of premises factor of choosing a location
How much it costs to buy or rent premises in each possible location also needs to be considered. A business will need to choose a location that it can afford where the rent or mortgage is low enough to allow it to make sufficient profit. Most retail businesses would choose to locate in city centres (such as Buchanan Street in Glasgow) or shopping centres with high footfall; however, it is very expensive to rent premises in these locations, meaning that many smaller businesses cannot afford it.
101
Describe the availability of labour factor of choosing a location
A business must consider whether the location they choose has enough people with the appropriate skills to employ. People will only be willing to travel so far to their place of work so the business will have to locate close enough to a populated area that has enough people with appropriate skills.
102
Describe the transport links factor of choosing a location
A business should assess the transport links to the location. It is essential that the area has good road and public transport links to allow customers and employees to easily reach the location.
103
Describe the government incentives factor of choosing a location
A country's government might offer incentives, such as grants, to businesses who locate their operations in a specific area. By locating in a government specified area, the government will provide the business with money to help set up their operations there.
104
What is E commerce
E-commerce is the buying and selling of products and services via the internet. The number of people using the internet to buy goods and services has grown significantly in the last decade and is expected to continue to rise exponentially in years to come.
105
What are the advantages of e commerce
consumers across the world can buy from the business, which is likely to result in increased customers;
customers can buy at whatever time is most convenient to them, which will increase the number of sales;
businesses do not have to pay rent or buy fixtures and fittings for physical premises, which reduces costs;
websites can display an unlimited number of products, which improves customer choice and satisfaction.
106
What are the disadvantages of e commerce
customers cannot see or handle products before buying them, which could result in businesses spending a lot of time processing returns and refunds;
there are high initial costs in creating a high-quality professional website;
increased competition as businesses now have to complete with online competitors across the world, which could result in a loss of customers;
ongoing maintenance and updates of websites and associated technology can be expensive.
107
What are the 4 main methods of distribution
Road - Using trucks, vans and lorries to deliver via the road network.
Rail - Goods are transported by trains using the rail network.
Air - Transporting goods around the world using cargo planes.
Sea - Transporting goods around the world using cargo ships.
108
What are the advantages of using road as a method of distribution
The only method which allows for direct door-to-door delivery.
A relatively quick and cheap method for delivering across short distances.
109
What are the disadvantages of using road as a method of distribution
Traffic jams and bad weather can cause delays.
Only transports a relatively small quantity of goods.
110
What are the advantages of using rail as a method of distribution
Large quantities of goods can be transported.
Relatively environmentally friendly.
111
What are the disadvantagees of using rail as a method of distribution
Distribution is limited by where there are stations to stop at.
Goods still have to be transported to the customer from the train station.
112
What are the advantages of using sea as a method of distribution
A much larger quantity of goods can be transported around the world than a plane.
Cheaper than air travel.
113
What are the disadvantages of using sea as a method of distribution
Very slow compared to air travel.
Goods still have to be transported to the customer from the port.
114
What are the advantages of using air as a method of distribution
The quickest method for transporting goods globally.
Planes can reach some parts of the world that other methods cannot.
115
What are the disadvantages of using air as a method of distribution
Very expensive.
A very high carbon footprint.
Goods still have to be transported to the customer from the airport.
116
What are the aims of promotion
inform consumers that the product exists;
provide consumers with information about what the product is and what it does;
persuade consumers to buy the product;
convince consumers to buy from the business instead of from its competitors.
117
What are the two categories of advertising
Traditional advertising: advertising methods which have been around for a long time, e.g. print and television.
Digital advertising: methods which have come about due to developments in technology, e.g. SMS and websites.
118
List the traditional methods of advertising
tv - adverts combining audio and video shown during the breaks of shows.
radio - audio adverts
cinema - adverts combining audio and video shown before the start of films.
newspapers/magazines - printed adverts containing text and images.
billboards - posters placed on large signs usually at the side of busy roads.
119
What are the advantages of using TV advertising
Potential to reach very large audiences as many people watch TV.
Demonstrations of the product can be given.
Can reach wide geographical audience
120
What are the disadvantages of using TV advertising
A relatively expensive method of advertising.
Modern technology and 'channel hopping' means consumers can avoid watching TV adverts.
121
What are the advantages of using newspaper advertising
Consumers can cut adverts out to keep for future reference.
Customers can be targeted through choice of newspaper.
122
What are the disadvatnages of using newspaper advertising
Limited to only text and images, which makes it difficult to make adverts memorable.
Newspapers contain many adverts, making it difficult to stand out from the crowd.
123
What are the advantages of using billboard advertising
Consumers will see the advert repeatedly, increasing the chances of them remembering it.
Usually placed in busy areas, meaning that lots of consumers will see it.
Can promote business in a specific geographical area
124
What are the disadvantages of using billboard advertising
Can only contain a small amount of information as most people will pass it quickly.
Can get vandalised or damaged by weather.
Only reaches a specific geographical area
125
What are the advantages of cinema advertising
Advanced sound and screen technology can make adverts more engaging.
There is a captive audience who will see the advert.
126
What are the disadvantages of cinema advertising
Only a relatively small number of people will see the advert at any one time.
Some consumers purposely arrive late to screenings to avoid the adverts.
127
What are the advantages of using radio advertising
Can reach a wide geographical audience
Cheaper to advertise than on TV
128
What are the disadvantages of radio advertising
Only sound, no products or demonstrations can be shown
Listeners can 'tune out' during the adverts
129
List the types of digital advertising
Internet adverts
SMS
In-app advertising
Email advertising
130
What are the advantages of internet adverts
Adverts can reach a global audience if consumers around the world visit the website.
Can target specific market segments by their interests and the websites that they use
131
What are the disadvantages of internet adverts
Consumers will ignore the adverts if they are focused on the content of the website.
Can be difficult to stand out from the many other adverts consumers will see when browsing the internet.
132
What are the disadvantages of SMS as a method of advertising
Customers can become annoyed if they receive lots of SMS adverts.
SMS message can only contain a very limited amount of information.
133
What are the advantages of SMS as a method of advertising
Cost effective as the text can be sent to a large volume of consumers simultaneously.
Customers receive the SMS message instantly.
relatively inexpensive method of promotion
134
What are the advantages of In app advertising
products can be targeted at specific customer groups
customers don't have to be online to see ads
135
What are the disadvantages of in app advertising
limited to smart phone or tablet owners
customers may be irritated by ads which interrupt game play or other activity
136
What are the advantages of Email advertising
emails can reach a wide audience
a relatively cheap method of promotion
same email can be sent to many recipients
good for the environment as no paper needed
attachments can be added
137
What are the disadvantages of email advertising
email may be treated as spam and not reach customer's inbox
email can be easily deleted or ignored without reading
worry about viruses in attachments can put people off opening email
138
List the types of sales promotion
Special offers
Discounts
Buy one, get one free
Point of sale displays
Loyalty cards
Free samples
Free gifts
Celebrity endorsement
Competition
139
Describe the special offers method of sales promotion
Special offers are short-term pricing strategies that businesses, especially shops, will adopt to encourage customers to buy from them.
140
Describe the discounts method of sales promotion
By offering products at a reduced price for a set period of time, a business can offer customers better value, for example 20% off the price of a brand of washing-up liquid. This can encourage customers to buy more or to buy from them rather than a rival company.
141
Describe the buy one get one free method of sales promotion
Buy One, Get One Free (BOGOF) is a commonly used special offer. This deal is used to offer customers extra value and may encourage them to buy more or to choose one business or product over another.
142
Describe the point of sales displays method of sales promotion
Point of sale displays are to be found at the checkout, for example at supermarkets. The point of sale display is most commonly designed to attract the customer to products that are new, for example the latest DVDs, books or video games.
143
Describe loyalty cards as a method of sales promotion
Loyalty cards can encourage a customer to keep coming back to the same business. Most commonly, loyalty cards operate on a points-based system. The more that a customer spends in a shop, the more points are added to their loyalty card. These points can then be converted into some sort of reward, for example a discount on other products.
144
Describe free samples as a method of sales promotion
Many food companies will offer free samples
as a way to let potential customers test a product. For example, supermarket shoppers will be given the chance to taste a new snack. The idea is that people will try the product and hopefully like it, encouraging them to buy.
145
Describe free gifts as a method sales promotion
Often a business will encourage customers to buy by offering a free gift with its product. For example, fast food companies give away toys with children’s meals, or some products include tokens in their packaging which have to be cut out and posted off in order to claim the free gift.
146
Describe competition as a method of sales promotion
The customer is entered into a draw to win prizes, e.g. electronics and holidays, by buying the product. This encourages the customer to buy the product more often as it increases their chance of winning a prize.
147
Describe celebrity endorsement as a method of sales promotion
Celebrity endorsement involves using a famous, well-liked person to promote a product. The celebrity might appear in the advert for a product or make social media posts discussing it. Fans of the celebrity are likely to buy a product if they see that the celebrity also uses it.
148
What should a business do to make sure its marketing is ethical
not intentionally mislead consumers by making false claims about a product;
ensure adverts do not contain indecent or obscene content that is intended to offend;
not intentionally include content which could offend consumers' moral or cultural beliefs;
ensure that adverts conform to discrimination legislation;
make sure adverts comply with legislation regarding the promotion of products to children, e.g. avoiding 'pester power'.
149
How is the internet used in marketing
A business might sell their goods and services via the internet; this is known as e-commerce
The internet can also be used to conduct market research by gathering secondary information from reliable online sources or asking customers to complete an online survey.
A business can also place advert banners on websites which they know that their target market are likely to use
150
How is desktop publishing used in marketing
Desktop publishing software can be used to create high-quality, attractive adverts and promotional materials.
151
How is Email used in marketing
A business can use e-mail software to send information about new products and special offers directly to customers. Customers must consent to the business using their e-mail for this purpose and can get annoyed if they receive too many marketing e-mails from a business.
152
How are smartphones used in marketing
A business might develop a smartphone app which allows customers to browse their product range and purchase directly through the app
The business might offer exclusive discounts and offers to encourage customers to download and purchase through their app. Push notifications can also be used to alert customers to new products or offers available via the app.
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How are databases used in marketing
A database could be used to store customers' details. They query function can be used to quickly search the database to find customers who meet specified criteria.
