Marketing Flashcards
Explain marketing
Meeting the needs and wants of customers so that marketing’s primary aim of increasing sales can be met
Explain the 4p’s of marketing
Product - the product the customer obtains
Place - how the product is distributed to the customer
Price - how much the customer pays
Promotion - how the customer is found and persuaded to buy the product
Explain promotion
A collection of techniques used to inform and persuade potential customers to buy a product or service that meets their needs
State the purpose of promotion
Inform customers or raise awareness
Increase sales
Encourage brand loyalty
Enhance the reputation/image of the business
State what ‘above the line’ promotion is
Uses media where there is no direct contact with the potential customer
State what ‘below the line’ promotion is
Uses the type of media where business can directly contact the potential customer
State the above the line promotion techniques
Television
Radio
Newspapers
Cinema
Sponsorship
State the below the line promotion techniques
Sales promotion
Packaging
Telesales
Personal selling
Trade fairs
Email
Merchandising
Direct and digital marketing
Explain drip marketing
Where information is sent to consumers bit by bit over time using a particular method of promotion (usually emails) to keep them updated on new products/offers
Explain viral marketing
The use of social media sites to increase brand awareness, usually in the form of posts or adverts so that people see it when using social media
Explain advertising elasticity of demand
Shows the extent to which spending on advertising will affect sales
Explain marker research
A systematic, objective collection and analysis of data about a particular target market
Reasons market research is undertaken
Describe the market - identifying the customers to ensure they’re targeted in an appropriate manner
Explaining the market - understanding why changes in the market have taken place
Predicting the market - knowing how customers will react to changes in the price of products
Investigating the reactions of customers in the future
Explain primary market research
New research that a business undertakes itself
Explain secondary market research
When a business uses existing information from other sources
Explain how interviews work
The candidates answer questions which help the business understand your skills, motivation and experience
Advantages and disadvantages of interviews (for market research)
+ you can tailor the interview to the specific needs of the research project
- time consuming and expensive
Advantages of surveys for market research
It’s a quick and economical method of gaining the opinions of consumers and potential customers
Explain why surveys may not be effective for market research
They can be brief and respondents may misinterpret questions or skip them
Explain focus groups
A small group of carefully selected participants who contribute to open discussions for research
Advantages and disadvantages of focus groups for market research
+ they offer in-depth understanding of the customer
- participants may want paying for their contribution to the discussion
Explain trial marketing
A system of ‘testing the waters’ before going ahead with the full launch of a product
Advantages and disadvantages of trial marketing
+ reduces the risk of a full scale launch
- delays in the full launch may limit the potential revenue opportunity
Advantages and disadvantages of market research reports
+ you’re better prepared to make decisions based on complete information
- time consuming and expensive to carry out
Explain census data
Information recorded about the population of a country
Explain quantitative research
Involves the collection of facts and the research concentrates on numerical data
Explain qualititative research
Aims to gather and analyse non-numerical data in order to gain an understanding of individuals
State factors affecting the price of a product
Objectives of the business
Consumers incomes and tastes
Cost of producing the good
Level of demand
Explain price elasticity of demand
The responsiveness of demand to a change in price of a product
Explain factors affecting price elasticity of demand
Whether the good is a necessity or luxury
The level of the price change
The income of the consumer
The number of previous price increases
Where there the purchase can be postponed
Explain income elasticity of demand
The responsiveness of demand for a product to a change in the persons income
Explain cross elasticity of demand
How the change in price for one good will affect the demand for another good
Explain price skimming
Where the business sets a high price for its goods or services in an attempt to gain profits quickly
Explain penetration pricing
Setting a low price to attract customers as it’s a new product, once this has been achieved the price may be raised
Explain premium pricing
A high price is set for a product or service in an attempt to crests an image and indicate a high level of quality
Explain psychological pricing
This involves setting a price that sounds less than it actually is - charging £0.99 sounds substantially cheaper than £1
Explain loss leaders pricing
Used to entice consumers into a particular retail outlet - used by supermarkets where they reduce the prices of essential products to below costs
Explain competitive pricing
A business sets their price below their competitors with the intention of gaining additional sales - only a short term strategy
Explain predatory pricing
An established business in the market lowers its prices so that it’s harder for a new competitor to compete because of the price
Explain market-based pricing
For products that are very similar or identical (homogenous), a business will take its price for the product form the market
State types of promotional pricing
Buy one get one free
Price reductions
3 for 2 offers
Loss leaders
Explain cost plus pricing
Adding a percentage to the cost of making the product to make a mark up
Explain price discrimination
Occurs when different prices are charged for the same product in different parts of the world or country
Explain Boston matrix
This categorises the products into one of four different areas, based on market share and market growth.
Explain product life cycle
Describes the stages that a product goes through over time - introduction, growth, maturity and decline
