Marketing Flashcards
What is marketing
Finding the needs of the customer and showing how the business can meet those needs
How does a business use marketing to fulfil their objective of increasing sales
1 identifying and understanding the customer - know who they are trying to sell to through market research
2 Informing customers about the product
3 increasing sales through advertising, increasing range of products available, reducing price, sell in different places
What does a business need to think about when it decides to market a product
1 who marketing is aimed at
2 location of customers
3 understand and identify customer neede
4 customer habits
What is analysis of a market
It identifies who customers are likely to be - age, gender, disposable income
Who are the target market
The people the business aims its goods at
Why is it useful to understand the target market
It helps the business to segment its market and aim its different products at different groups
What is market research
How a business collects information about if their product will be bought and avoids unnecessary investment
What are the 2 categories of market research
Primary and secondary
What is primary research and what is it also known as
Also known as field research and it is collecting new information
What is secondary research and what is it also known as
sometimes called desk research and it involves looking at research and information collected by others,
Which methods of primary research will businesses use
Questionnaires, interviews, trials, focus groups
What bare the advantages of questionnaires
1 cheap
2 can target particular consumers
Disadvantages of using a questionnaire
a difficult to predict how many will be completed
2 people may not understand the questions
What are the advantages of interviews
1 questions can be explained by interviewer
2 customers can be easily targeted
What are the disadvantages of interviews
1 can be expensive
2 customers can be uncomfortable being stopped in the street
How can trials be useful
As they can determine if there is a demand for the product
How does a trial work
A product is sold for a short period of time as a test to see if it is popular
What are the advantages of trials
1 can save a business money if they find out the product is not popular
What are the disadvantages of trials
1 trials can be costly
2 often carried out in one area which may not be representative of population
What are focus groups
Small groups of people carefully selected to represent the target market. They are given information and asked questions and their answers are analysed to provide data
What are the advantages of a focus group
usually accurate and reliable data as groups are showed to represent the market
What are the disadvantages of focus groups
groups are small and this makes collection expensive and time consuming
Give some examples of secondary research
census data, websites, internal data, newspapers and magazines
What is a census
Every person living in Britain is questioned about how they live, income and other information useful to a business. Collected every 10 years
How does a business use census information
Useful information about age of population, could help plan future needs eg if night clubs would be popular in years to come
How are are websites useful for businesses
Many companies put information on about themselves which could be used by competitions
What is internal data
Many companies have their own secondary data eg past sales figures, profits from departments which can be used to make future decisions
How can magazines and newspapers be useful form of secondary data
They are full of information that could be useful to a businesses trends in fashion ad interests that could be used to develop new products
List the advantages of secondary research
1 much cheaper usually than primary
With the internet there is now a wide range of info available
List the disadvantages of secondary research
1 information may not be exactly what the business wants
2 Data may not be up to date
3 data may not be in the form that a business can analyse
What is qualitative data
collected when customer opinion is needed
Usually collected by primary research
Disadvantages of qualitative data
can be hard to interpret opinions eg
People may say they don’t like a product but buy it for someone else
What is quantities date
Facts and numbers, can be collected using primary or secondary and the data is easy to analyse
What does market research find out
1 what customers want
2 what they are willing to pay
3 where and how to sell
4 the design that will be attractive
How many products customers will buy
What is market segmentation
Splitting the market for a product into different parts eg clothing into men’s women’s children’s and teen fashion
Why is segmentation helpful
People in different segments want different types of products business will target different products at needs of customers in a segment Helps to identify target market effectively and looks at the different types of customer that might buy a product
Give examples of hoe a market could be segmented
by age gender income location lifestyle
Give an example of how age is a segment
Gender - different colours
Income - certain watches show wealth
Location - different parts fo the country have different needs city small car country 4x4
Lifestyle different hobbies this also connects to location and income
Different ages buy different products technology is aimed at the young
what is the marketing mix
4 ps price product place promotion
State factors affecting price of products
1 look at price charged by competitors
2 if a new business price lower to entice customers
3 consider costs as well as profit
List the different pricing strategies
1 competitor pricing - looking at what competitor charges to indicate what you should charge
2 cost plus - look at cost to make and add profit
3 penetration - reduce price to tempt customers away from established names
4 skimming - selling a high end product at high price at its introduction and prices falls later
5 promotional - reduce to attract customers to existing product or to sell off old products
What considerations should be made about a product
1 make a product customers will want to buy at a price that will make profit - through market research
2 Image and design and style - does it need updating
3 design innovation - try to develop something new - technology plays big part here, there is a large financial investment
4 plays an important part in success eg desingning the smallest mobile phone
5 branding - linked to design and image often linked to a logo which will indicate a certain quality eg budget, high end
6 product life - most products have a life span, tastes change and products must keep up with this.
What are the 4 stages of product life cycle
Introduction
Growth
Maturity
Decline
Describe the introduction stage
1 product launched following investment and market research
2 business may advertise as currently product is unknown by consumers
3 sales should start to rise
Describe the growth stage
1 sales rise rapidly, no need for special offers as product is in high demand
Describe maturity and decline stages
1 sales at highest but declining
2 may need further advertising or offers to maintain sales - successful business will already have developed a new product to replace this one
State the methods a business uses to extend the life of a product
1 advertising more widely as anew or more improved product or modernising packaging
2 reduce price
3 product exported-different target market
In businesss what does product place refer to
What ar the 2 main methods
Where the product is sold how goods reach a customer
Physical and digital distribution
How is product place changing
Businesses used to sell to public from shops on the high street, this is more out of town shopping now and high street shops are closing
What is distribution channel and how is this changing
method of distribution changing because of the growth in technology enabling digital distribution has grown
What is physical distribution and give examples
Movement of goods we can see. Goods made in a factory sent to a shop, food grown by a farmer sent to shop, products mined from the ground and sent to be made. Usually movement is by road or air
Outline 3 physical distribution methods
1 producer distributing directly to customer
Small businesses selling to another business where number of customers is small
2 producer sells to a shop who then sells to a customer- common with electrical goods
3 producer sells to wholesaler to to RDC who have storage
What is the role of a wholesaler
Buy in bulk from producer and sell in smaller amounts to retailer, can give credits to retailers ‘trade credit’ and will deliver to retailer
What is role of RDC
Storage facility owned by retailer to send to their shops later
What is digital distribution give examples
No physical movement of goods, they are downloaded although don’t have to be paid for digitally. Music books insurance banking
How is digital distribution different to e commerce
there can be a physical product with e commerce
What are the advantages of digital distribution
1 24 hour access
2 goods quickly available
3 cost savings for businesses
Disadvantages of digital distribution
1 not suitable for all goods
2 business may feel forced into it to keep up with competitions
3 not all customers have internet
4 it is now easier to illegally copy and distribute for free
What is promotion
How a business informs a customer about their product and persuades them to buy it
What are the aims of a promotion
1 inform customer about a product
2 keep ahead of competitors
3 create an image change for a product
4 maintain or increase sales
What are the 2 categories of promotion
Point of sales and advertising
Give examples of point of sales
1 price reduction - to sell off old sock or boost sales when a product would not usually sell eg Christmas cards in January
2 loss leaders - form of price reduction, reduce to point where shop gets little profit but it attracts customers into the shop who buy other things
3 competitions - customers enter into monthly draw
4 free samples - allow customers to try products if reluctant to buy full size product
give examples of advertising
1 advertising media reaching wide audience
2 websites -can include video links
3 printed media - ideal for low cost advertising only reach local target
3 leaflets
4 tv - wide audience can target a group by choosing programme expensive
5 radio - cheaper than tv product can’t be seen
What is an advertising campaign
series of adverts using different types of media
Explai. How the 4 aspects of the marketing mix work together
A business must have a PRODUCT customers want to buy. It has to be distributed and sold in a PLACE customers are happy with. PRICE of product must be acceptable and to attract interest the goods must be PROMOTED
Is one aspect of the mix ever more important than another aspect - explain
yes a new product will need more advertising. A new cafe on a high street may charge lower prices
What is market data
Information that helps a business make marketing decisions
What information might market data include
1 changes in demand
