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Business Management > Marketing > Flashcards

Marketing Flashcards

1
Q

What is market segmentation?

A

Splitting customers into groups then marketing a product or service specifically to those groups

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2
Q

What are some examples of market segments? (6)

A

Age, Gender, Location, Socio-economic grouping, Religion,
Lifestyle

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3
Q

Identify 2 market segments that an organisation could target

A

Age + Location

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4
Q

Give 2 methods an organisation could use to segment a market

A

Lifestyle + Health conscious

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5
Q

What are the benefits of target marketing?(4)

A

-Tailoring of products to meet the needs of particular groups of consumers. If a product meets the needs of a consumer, sales will increase.

-Sale of products in the most appropriate places to reach the chosen target audiences. This can maximise sales.

-Pricing will be set to reflect what a target market will be willing to pay for a product or service. This can maximise profits.

-Customers will become loyal to the brand

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6
Q

What is field research?

A

Field research gathers primary information that is first-hand information. It has been collected by the business for a specific purpose.

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7
Q

What are some examples of field research?(7)

A

face-to-face interview
postal survey
focus group
hall test
telephone interview
online survey
observation

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8
Q

What is desk research?

A

Desk research gathers secondary information that is second hand information. It has been collected for a different purpose.

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9
Q

What does market research tell the business?

A

Information about competitors, Effective promotion methods to use, The effect of price on the market, customer feedback

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10
Q

What are some examples of desk research?(5)

A

Sales figures
Newspapers
Websites
Government publications e.g. the Census
Commercial publications e.g. Keynote and Mintel reports

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11
Q

What are the advantages of field research?

A

-Competitive edge: only the business has access to the findings

-Up to date: the business will know the date it was carried out

-Accurate: Collected for the specific purpose for the business

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12
Q

What are the disadvantages of field research?

A

-Expensive to carry out: the business has to create surveys, train employees to carry out interviews

-Time consuming

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13
Q

What are some advantages of a hall test?

A

Can see respondents reactions first hand
Can ask respondents further questions

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14
Q

What are some advantages of a telephone interview?

A

Can reach a large geographical area
Inexpensive

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15
Q

What are some advantages of an online survey?

A

Can send it to a large sample size
You can get feedback quickly

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16
Q

What are some advantages of a focus group?

A

Can gain information from respondents body language, facial expressions, tone
Can explore topics in depth

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17
Q

What are some advantages of a face-to-face interview?

A

Two way communication
Can clarify any misunderstandings

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18
Q

What are some advantages of a postal survey?

A

Inexpensive
Can target specific postcodes

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19
Q

What are some advantages of an observation?

A

Can see real life behaviours in action

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20
Q

What are some disadvantages of a hall test?

A

The respondent may feel obliged to give a positive response

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21
Q

What are some disadvantages of a telephone interview?

A

Could have a low response rate as customers see it as a “nuisance call”

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22
Q

What are some disadvantages of an online survey?

A

Limited to people with internet access

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23
Q

What are some disadvantages of a focus group?

A

This data is harder to analyse
Can be expensive to pay respondents to participate

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24
Q

What are some disadvantages of a face-to-face interview?

A

Can be expensive
Business needs to train staff how to interview

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25
Q

What are some disadvantages of a postal survey?

A

Low response rate as seen as junk mail

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26
Q

What are some disadvantages of an observation interview?

A

Analysis of the observation could be biased

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27
Q

What are the 4 Ps in the marketing mix?

A

Product, Price, Place, Promotion

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28
Q

What is the definiton of product?

A

A good or a service that is sold to customers or other businesses. This includes the after-sales service and packaging.
A product should have a USP (Unique Selling Point).

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29
Q

What is the definition of price?

A

This is what customers pay in order to obtain the product.

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30
Q

What is the definition of place?

A

This is the process by which the product reaches the market and consumers.
(This includes where the consumer purchases a product from the business. This can be in a physical location, through a website or an app. It also includes how the product is distributed.)

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31
Q

What is the definition of promotion.

A

How a business sells their product to customers and other businesses.

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32
Q

What is a USP?

A

What makes your business different to competitors

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33
Q

Why is it important to have a USP?(4)

A

-Helps the brand stand out from competitors
-Customers may be attracted to your company because of the USP
-Use they it as a promotional tool in promotional campaigns
-Charge a higher price

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34
Q

Be able to draw a diagram of the product lifecycle.

A

Practise

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35
Q

What are the four stages of the product lifecycle?

A

Introduction, Growth, Maturity + Decline

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36
Q

Describe the introduction stage of the product lifecycle.

A

This is when the product has just been launched in the market and sales are slow. No profit is made yet due to still covering advertising costs.

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37
Q

Describe the growth stage of the product lifecycle.

A

This is when sales begin to rise as more customers become aware of the product. The business may begin to make profit at this stage.

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38
Q

Describe the maturity stage of the product lifecycle.

A

This is when sales and profit are at their peak in this stage as the product is now well known. This means less advertising is needed now.

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39
Q

Describe the decline stage of the product lifecycle.

A

This is when sales and profit begin to fall because newer products are entering the market

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40
Q
A
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41
Q

What are the advantages of branding?

A

-Can save money on marketing once the brand is a household name
-Higher price can be charged
-Easier to launch new products
-Customer loyalty

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42
Q

What are the disadvantages of branding?

A

-Fakes can appear- expensive to fight
-One product can affect whole brand image
-High initial costs

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43
Q

What does the term ‘own brand’ mean?

A

Large retailers sell branded goods under their own name or own brand names. Their products can be cheaper than branded goods and are of a similar quality e.g. Tesco Value.

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44
Q

What is it important for packaging to be?

A

Biodegradable, Reusable, Recyclable, Organic, Minimum

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45
Q

What is an advantage of packaging?

A

-It provides protection during transportation, customer appeal and recognition
-helps to keep goods fresh
-provides easy recognition of a product/brand
-creates opportunities for promotion/advertising
-provides legally required information
-provides information on it such as nutritional values/traffic
lighting
-Provides customer appeal

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46
Q

What is a disadvantage of packaging?

A

-Businesses are legally required to print information on it such as ingredients and weight.
-the cost of producing packaging will reduce profit
-Negative environmental impact

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47
Q

What are the benefits of a business having a strong brand?(6)

A

-Brand loyalty which means you are guaranteed returning customers
-Brand recognition so less advertising required
-Gives an illusion/image of quality which means higher prices can be charged
-Easier to launch new products due to customers being familiar with the brand

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48
Q

Outline the stages of product development.

A

-Carry out market research.
-Generate the idea.
-Analyse the idea.
-Produce a prototype.
-Test the product.
-Adjust the product based on tests and feedback.
-Change the packaging.
-Produce the product.
-Decide on the advertising and promotions/advertise so
consumers know it is available.

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49
Q

What must price do?

A

Cover costs and Not be too high for the target market

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50
Q

What are some factors to consider when setting the price?(7)

A

Competition, Quality of Raw Materials, Image, Production Cost, Profit per Unit, the economy, demand

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51
Q

Why does a business have to consider competition when setting the price?

A

A business can follow the lead of its competitors when it comes to pricing or adopt its own pricing strategy e.g. lower the price compared to competitors.

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52
Q

Why does a business have to consider raw materials when setting the price?

A

The price should reflect the quality of the raw materials used e.g. higher price for a meal made with fresh local ingredients

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53
Q

Why does a business have to consider image when setting the price?

A

The price will affect a customer’s perception of a product e.g. high prices are associated with luxury brands

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54
Q

Why does a business have to consider production cost when setting the price?

A

The price should be higher than the cost to make the product

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55
Q

Why does a business have to consider profit per unit when setting the price?

A

The business must consider how much profit they want to make on each product e.g. 50% markup

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56
Q

Why does a business have to consider the economy when setting the price?

A

If there is a recession customers have less money to spend so the price may need to be lowered

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57
Q

Why does a business have to consider demand when setting the price?

A

If there is high demand for the product then the price can
be increased e.g. BBQs becoming more expensive in the summer
months

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58
Q

What is premium pricing?

A

The price is set higher than competitors to achieve the image of quality

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59
Q

What is low/economy pricing?

A

The price is set lower than competitors to be the cheaper alternative

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60
Q

What is competitive pricing?

A

Businesses charge the same price as their competitors then compete on factors other than price

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61
Q

What is promotional pricing?

A

Price is reduced for a short period of time

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62
Q

What is price discrimination?

A

A business charges different prices for the same product or service at different times of the day/ year e.g. off-peak

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63
Q

What is price skimming?

A

A new product enters the market at a high price then lowers over time

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64
Q

What is penetration pricing?

A

The price is set low when entering the market then rises once the product has become popular with customers. Used in a market with lots of competitors.

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65
Q

What is cost plus pricing?

A

This is a strategy used to set the price. The cost to make the product is calculated then a % of profit added to create the price.

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66
Q

What is destroyer pricing?

A

The price of a product is set much lower than competitors so they can’t compete

67
Q

What is psychological pricing?

A

The price is set just below a whole number to appear cheaper e.g. 99p, £249

68
Q

What is the channel of distribution?

A

The route a product takes to get from the manufacturer to the customer.

69
Q

What is a manufacturer?

A

A business which produces goods to be sold

70
Q

What is a wholesaler?

A

A business which buys goods in bulk from the manufacturer to sell on to retailers or consumers

71
Q

What is a retailer?

A

A business which sells goods to customers in relatively small quantities

72
Q

What is a consumer?

A

People who buys the goods to be consumed

73
Q

What is a mail order?

A

a business sells its products via a printed catalogue which is sent to the consumer e.g. Boden

74
Q

What are the advantages of a mail order?

A

Customers can browse products in their own time e.g. when having a cup of tea
Can save on physical store costs e.g. rent

75
Q

What are the disadvantages of a mail order?

A

Catalogues can be expensive to produce
Catalogues are not environmentally friendly - may face backlash

76
Q

What is direct mail?

A

A business sends letters, leaflets or brochures to customers via post or in magazines/newspapers

77
Q

What are the advantages of direct mail?

A

Specific market segments can be targeted e.g. supermarket discounts and recipe cards inside cooking magazine

78
Q

What are the disadvantages of direct mail?

A

Can be seen as ‘junk mail’ and thrown away

79
Q

What is personal selling?

A

a salesperson sells products ‘door to door’

80
Q

What are the advantages of personal selling?

A

Allows demonstration of a technical product and more info on the product to be given

81
Q

What are the disadvantages of personal selling?

A

May find not answer the door

82
Q

What are shopping channels?

A

a business sells products on the TV using a dedicated channel on the TV e.g. QVC

83
Q

What are the advantages of shopping channels?

A

Customers can see products being modelled and demonstrated
Customers can be convinced to buy products using ‘limited time’ offers or special prices

84
Q

What are the disadvantages of shopping channels?

A

Customers need to be watching the channel to see the product being sold
Customers may be put off by delivery costs or having to wait for the product to be delivered

85
Q

What are examples of direct selling?(4)

A

Shopping channels, Personal Selling, Direct mail, Mail order

86
Q

What are examples of retailers?

A

Online retailers, convenience supermarkets, discount stores, department stores, retail parks.

87
Q

What are online retailers?

A

Businesses who sell their product or service online. Rather than setting up their own online store some manufacturers will sell through other online sites

88
Q

What are discount stores?

A

Stores that sell branded products at lower prices

89
Q

What are department stores?

A

Sell a variety of different products often over many levels in different departments e.g. menswear or cosmetics

90
Q

What are convenience supermarkets?

A

Small versions of supermarkets located in city centres.

91
Q

What are retail parks?

A

Many shops found in one location on the outskirts of major town/cities that is close to good infrastructure

92
Q

What are some factors to consider when choosing a location? (9)

A

Demand, competitors, close to suppliers, cheap, easy access to staff, good infrastructure, parking, government legislation, government grants.

93
Q

Why is it important to consider demand when choosing a location?

A

So that you are at a location with demand from consumers in the area who want their goods and services

94
Q

Why is it important to consider competitors when choosing a location?

A

So that you are at a location away from competitors to attract more customers OR near competitors to give customers choice

95
Q

Why is it important to consider close suppliers when choosing a location?

A

So that you are at a location close to suppliers of raw materials to reduce lead time and transport costs

96
Q

Why is it important to consider a cheap location?

A

So that you are at location with a cheap price or cheap rent so you can maximise profit.

97
Q

Why is important to consider a location that staff can access easily.

A

So that you are at a location that staff can easily access and local people can be employed as they have the suitable skill set

98
Q

Why is it important to consider a location with good infrastructure?

A

So that you can access, for example, road and rail links

99
Q

Why is it important to consider a location with good parking?

A

Some businesses will want a location with customer parking

100
Q

Why is it important to consider government legislation when choosing a location?

A

So that you are at a suitable location not breaking any government legislation e.g Health and Safety Act

101
Q

Why is it important to consider government grants when choosing a location?

A

So that you are possibly at a location where the business is eligible for a government grant

102
Q

What is distribution?

A

Products need to be transported from the manufacturer to the wholesaler, retailer or consumer.

103
Q

What are the methods of distribution?

A

Road, rail, air, sea

104
Q

What are the advantages of road distribution?

A

Door to door delivery
Cheapest method of transport

105
Q

What are the disadvantages of road distribution?

A

Difficult to transport large items
Can be slow
Not environmentally friendly

106
Q

What are the advantages of rail distribution?

A

Can transport large quantities
Often quicker than road

107
Q

What are the disadvantages of rail distribution?

A

Often rail stations are not located near customers or retailers so still require another method of transport

108
Q

What are the advantages of air distribution?

A

Can transport items worldwide
Quick method of transport compared to sea

109
Q

What are the disadvantages of air distribution?

A

Can’t transport large items
Very expensive

110
Q

What are the advantages of sea distribution?

A

Can transport large quantities in shipping containers

111
Q

What are the disadvantages of sea distribution?

A

Slow and time consuming
Very harmful to the environment

112
Q

What factors do you have to consider when choosing which method of distribution to use? (4)

A

Market Structure, product type, method costs, infrastructure

113
Q

Why do you have to consider market structure when choosing which method of distribution to use?

A

Goods created on an island need to be transported by sea or air.

114
Q

Why do you have to consider product type when choosing which method of distribution to use?

A

different products have to be transported in different ways. E.g. perishable need quick and refrigerated options

115
Q

Why do you have to consider method costs when choosing which method of distribution to use?

A

the amount of finance available and the cost of transport

116
Q

Why do you have to consider infrastructure when choosing which method of distribution to use?

A

this will affect options e.g. can’t use air if no airport

117
Q

What are the advantages of e-commerce?(5)

A

-Can sell to customers all over the world
-Online shopping 24/7
-Discounts can be given to customers
-Businesses can save money because they don’t need a physical store
-Whole product range can be shown

118
Q

What are the disadvantages of e-commerce?

A

-Goods can’t be seen or handled before they are purchased.
-Can be expensive to pay for an internet service provider.
-Can be expensive to make and maintain a website.
-Employees need training to maintain and update the website

119
Q

What are some methods of promotion?(6)

A

Discounts, Free samples, Celebritity, Loyalty Card, Competition, Advertising

120
Q

What are discounts?

A

Provide customers with money off for a limited time when they buy it e.g. BOGOF, 20% off

121
Q

What are free samples?

A

Customers can try the product before they buy which may increase the likelihood of a sale

122
Q

What is a celebrity endorsement?

A

a business pays a celebrities to use and promote its products

123
Q

What is a loyalty card?

A

a customer collects points every time they shop then can exchange them for a reward

124
Q

What is a competition?

A

a customer can be entered into a prize draw when purchasing a product e.g. to win a free holiday,

125
Q

What is advertising?

A

a business can use broadcasting or print media, apps, social media etc

126
Q

What are the advantages of celebrity endorsements?

A

Consumers are attracted to the product in an attempt to be like the celebrity
The celebrity is a household name so the business can save money on marketing
Higher prices can be charged as the product can be seen as higher quality
Customers can become loyal to the celebrity and brand

127
Q

What are the disadvantages of celebrity endorsements?

A

It is expensive to pay a celebrity to promote your product
If the celebrity receives bad press then the celebrity could damage the business reputation

128
Q

What are sales promotions?

A

Sales promotions are designed to be used as a short-term tactic to boost sales

129
Q

What are some examples of sales promotions? (4)

A

Special offers e.g. BOGOF
Coupons
Competition
Free samples

130
Q

What are the different types of advertising?

A

Informative, Persuasive, Product Placement, Product endorsement

131
Q

What is informative advertising?

A

Informs the customers about the product (features, USP)

132
Q

What is persuasive advertising?

A

Gives the impression it is desirable to own these products or services

133
Q

What is product placement?

A

A business pays for its products to appear in a movie, game, TV show

134
Q

What is product endorsement?

A

Celebrities get paid to use and recommend a product

135
Q

What are the advantages of TV advertising?

A

-Can reach many customers
-Can demonstrate the product
-Target different markets depending on time/channel

136
Q

What are the disadvantages of TV advertising?

A

-Very expensive
-Viewers channel hop during adverts

137
Q

What are the advantages of advertising with newspapers/magazines?

A

Can be aimed at different market segments
Can be kept for future reference

138
Q

What are the disadvantages of advertising with newspapers/magazines?

A

Can be expensive
Competitors also advertise here
Easy to flick past

139
Q

What are the advantages of advertising on the radio?

A

Cheap on local stations
Captive audience with viewers less likely to channel hop

140
Q

What are the disadvantages of advertising on the radio?

A

Listeners may not pay attention
Cannot see the product

141
Q

What are the advantages of cinema advertising?

A

Captive audience

142
Q

What are the disadvantages of cinema advertising?

A

Limited audience
More likely to remember the film than the advert

143
Q

What are the advantages of direct mail?

A

Cheap
Can target market segments

144
Q

What are the disadvantages of direct mail?

A

Many consumers bin ‘junk mail’

145
Q

What are the advantages of billboard advertising?

A

Usually in a busy location so large audiences
People may go past it more than once

146
Q

What are the disadvantages of billboard advertising?

A

Deteriorate with the weather and vandalism

147
Q

What are the advantages of advertising via apps?

A

Can be downloaded onto the phone- send reminders and pop up adds

148
Q

What are the disadvantages advertising via apps?

A

May be ignored or deleted

149
Q

What are the advantages of advertising via social media?

A

Can target large audiences
Can respond quickly to changes/customers
Relatively inexpensive

150
Q

What are the disadvantages of advertising via social media?

A

Customers may not see adverts unless they already follow the business

151
Q

What are some factors to consider when choosing promotion? (6)

A

-The actual product/service for example do customers need to see a demonstration?
-Where the target market is likely to see the promotion or access it
-Is the business selling locally, nationally or global?
-Available finance will influence what promotions the business can afford
-The business will consider where competitors are promoting
-Legal restrictions have to be considered e.g. cigarettes can’t be advertised on TV

152
Q

How could a business be unethical in its marketing activities?

A

Obtain market research illegally or without permission e.g. not asking for participants consent to interview them
Reach agreements with competitors to keep prices high and exploit customers
Exclude potential customers from the market
Deliberately market their products at vulnerable groups e.g. children or the elderly
Carry out false advertising e.g. the product claims to do something it cant

153
Q
A
154
Q

What are the advantages of carrying out an online survey?

A

Cost effective
Can be sent to a large number of participants at once
Can be emailed to customers e.g. after a purchase
Data can be analysed instantly

155
Q

Why are EPOS (electronic points of service) used?

A

-regular purchases
produce information which can be used to target promotional campaigns to the appropriate customers

156
Q

What is the advantage of using a QR code?

A

It enables the customer to access the goods quickly and easily. This could increase sales.

157
Q

What are the advantages of e-commerce?

A

-The business can sell 24/7 as it is not limited to shop opening times
-Can sell to a worldwide market
-Can offer customers discounts via the website or app
-Customers can view the businesses whole product range

158
Q

How do marketing use a database?

A

Information on customers can be stored in databases. These can be searched to find customers with specific characteristics. This can then be used for target marketing or promotional campaigns.

159
Q

How do marketing use email?

A

This can be used to send surveys or promotions to customers.

160
Q

How do marketing use slides/powerpoints?

A

Can be used to display market research information, present promotional campaign or new adverts to management.

161
Q

How do markting use apps?

A

Apps can be used to give customers easier access to products and services. They can also be used to advertise products, for example ‘in-app’ advertising when playing games.

162
Q

How do marketing use spreadsheets?

A

Can be used to analyse data from market research and create graphs and carry out calculations.

163
Q

How do marketing use desktop publishing?

A

DTP software can be used to create professional looking advertisements to encourage customers to purchase products.

Business Management (7 decks)

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