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Business Nat 5 > Marketing > Flashcards

Marketing Flashcards

1
Q

What is Market Share?

A

It is the percentage of all sales in the market for that product

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2
Q

What is Market Growth?

A

-It is taking customers from existing businesses or attracting new customers to buy the product in a certain market

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3
Q

What is a target market?

A

a particular group of consumers with a common characteristic which a product or service is aimed at.

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4
Q

What are the benefits of target marketing?

A

-Improves customer satisfaction as customers needs are being met.
-Customers will be loyal to the product and keep buying
-Influx of customers leading to an increase in market share
-The correct price can be set depending on the target market

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5
Q

What is market segmentation?

A

The identification of groups with similar needs and wants within a market.

Some common market segmentation are age, gender, income, geographical location and occupation.

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6
Q

What is the difference between the consumer and the customer?

A

Customer is the person who buys the product

Consumer is the person who uses the product

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7
Q

What is market research?

A

The constant gathering, recording and analysing of data about an organisation’s product and their target market.

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8
Q

What is market research used for?

A

-Identifies customers’ needs and wants
-To see consumers reaction to the new product
-How much customers are willing to pay for the product
-Identifies target market

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9
Q

What are the 2 types of market research?

A

Field research and Desk research

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10
Q

What is desk research?

A

Information that has already been gathered for another purpose e.g. internet

Methods are: Newspaper, magazine, websites, social media, government statistics

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11
Q

What are the advantages and disadvantages of desk research?

A

Advantages
-Information already exists
-Cheaper than field research
-Obtained easily and the information is readily available

Disadvantages
-Information may be out of date
-Same information is available to competitors
-Information may contain bias

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12
Q

What is field research?

A

The organisation gathering its own information first hand

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13
Q

What are the benefits and costs of field research?

A

Benefits
-More reliable as it has been gathered first hand and the source can be verified
-Meet the needs of the organisations
-Not available to competitors
-Will be up to date

Costs
-More expensive than desk research
-Takes time to gather information
-It can be costly if people need to be trained in order to conduct the research
-A wide audience must be surveyed if findings are to be realistic

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14
Q

What are postal surveys?

A

Sending our/delivering questionnaires to people’s homes.

Advantages
-It is inexpensive as it does not require a trained interview

Disadvantage
-Response rate from people can be low
-Questions need to be simple, so people can fill out without any misunderstandings
-People tend to bin postal surveys as ‘junk mail’

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15
Q

What are hall tests?

A

This is where the product is given to customers to try and their feedback is obtained

Advantages
-Customers actually try the product and so can give good feedback
-Fairly inexpensive to carry out

Disadvantages
-Customers might feel obliged to give positive feedback because they have a free product
-Difficult to analyse qualitative information

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16
Q

What is test marketing?

A

Launching a product in a small regional area

Advantages
-may highlight aspects of the product that customers dislike
-Saves an expensive national launch if the product fails in the test area

Disadvantages
-Customers in one area may have regional tastes that are not representative of the national population

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17
Q

What is a social networking site?

A

Websites such as twitter and Facebook can be used to gather field research.

Advantages
-Large number of customers can be contacted
-Customers will respond quickly

Disadvantage
-Customers may not have Facebook or twitter accounts
-Competitors can view information as it is public

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18
Q

What is observation?

A

This involves watching and recording customers reactions and daily shopping

Advantages
-The people being observed may be oblivious to this fact and will therefore respond in a natural way
-Quantitative information is gathered

Disadvantages
-The observer cant ask those being observed to explain why they did or did not do something

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19
Q

What are the difference between the Field Research and Desk Research

A

Field research then Desk research

  • Field is researched by the business themselves whereas desk is gathered from a secondary resource
  • Field is gathered for a specific purpose so it is relevant whereas desk is gathered for another purpose may be vague and not relevant
  • Field up to date as the information has just been gathered whereas desk is old and out of date because the figures may be from a couple years ago and trends have changed
  • Field costly to gather as wages and cost of equipment need to be considered whereas desk is cheap to gather as it is research information that has already been gathered so there are no costs
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20
Q

What are the steps involved in when developing a new product?

A

Carrying out market research
-finding out what potential customers need’s and wants are and find a gap in the market

Generate an Idea
-Brainstorming session or focus group to come up with ideas

Testing the idea
-Considering whether the product will be success, taking into account a number of factors

Create a Prototype
-When a prototype of a product will be developed using details that the market research indicated the consumers want

Test the Product
-Test consumer response, before it launches nationally

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21
Q

What are the 4 P’s in Marketing

A

Product, Price, Place, Promotion

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22
Q

What is introduction in the product life cycle?

A

The product is first launched, heavily advertised to make customers aware of the product, sales are low.

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23
Q

What is growth in the product life cycle?

A

Awareness of the product is increasing and sales rise rapidly.

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24
Q

What is maturity in the product life cycle?

A

Product is well known in the market, sales are at its highest. Advertising is reduced, Competition has increased and the price of the product falls, most profitable stage.

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25
What is decline in the product life cycle?
Sales and profit start to fall as new and more advanced products enter the market.
26
What are extension strategies?
A business wishing to extend the life of a product which has reached maturity or is in decline can alter one or more of the marketing mix by changing. Product-alter the packaging, introduce a new version Price-reducing the price to interest customers Promotion-introduce a new adverting campaign Place-change where it can be bought, for example move online
27
What is branding?
A brand is a name, symbol, design that makes a product instantly recognizable.
28
What are the advantages of branding?
-Brand is easily recognised, this means that the customer may buy more as they are familiar with the product -Brand loyalty is developed, customers feel that that brand is the best available, this could increase market share -Can charge higher prices, customers are willing to pay more a specific brand, this can lead to a certain image for the product -Easier to launch new products, customer is loyal to a brand, new products under that brand will be looked at the same way, this means less chance of a product failing
29
What are disadvantages of branding?
-One fault with a product may affect the image of the whole product range and brand, this means that customers may stop buying so market share decreases -Brands can be copied and fake products can be produces and sold, this can affect the brand image -It is time-consuming and expensive for a business to establish a bran which impacts upon profitability
30
What are own brand products?
These are goods/services that are branded under the name of a retailer, e.g. tesco finest, george at ASDA
31
What are the advantages of own brand products?
-They do not require advertising -They are usually cheaper than branded products which makes them more popular
32
What are the disadvantages of own brand products?
-They can be seen as poorer quality -Can be seen as a poor copy of the branded product -One poor quality product can affect the whole range of products -Can affect the reputation of the business is the quality is poor
33
Outline the advantages of packaging
-Protects the product during transport -Makes the product more appealing -Allows the customer to easily access the product
34
Outline the disadvantages of packaging
-Businesses are legally required to print information on packaging, such as ingredients, weight, etc. -Packaging causes environmental problems
35
What are factors to consider when setting the price of a product
-Cost of production: This means the cost of making the product will be covered meaning there will be less chance of a loss -Competitors' prices: This means that the product will be in line with what the competitors are charging -Level of profit the organisation wishes to make: This means the business will be able to reach the objective of making a profit
36
What are some pricing strategies?
-Cost plus pricing: the firm calculates the cost of producing the product and adds on a percentage to that price to arrive at the selling price -Competitive pricing: When rival companies charge similar prices for similar products to avoid a price war -Price skimming: Charge high price for new products, once competition enters the market the price will be forced back down -Psychological Pricing: Making the customer think a product is cheaper than it really is by charging £0.99 rather than £1.00
37
What are factors to consider when choosing a location?
Parking Facilities-Customers need easy access to the business otherwise they may go elsewhere Competition-A business can locate further away to avoid competitors or it may choose to locate nearby to increase their market share Availability of labour-Employees with the right skills and education need to be close by Good transport links (infrastructure)- Good access to motorways, train stations etc. for deliveries and customers
38
What is e-commerce?
The buying and selling of goods online
39
What are the advantages of e-commerce?
-Products can reach a wider audience, which can increase sales and market share -Reduces cost for renting shops and premises -Reduces number of staff needed therefor staffing costs are reduced -Products are available on the website 24/7
40
What are disadvantages of e-commerce?
-lack of customers interaction-sales assistants cannot communicate and help customers the same way as a physical store -Decreased loyalty, there are so many options online that customers are no longer loyal to one retailer, they simply look for the best deal -Increased costs for postage, business' must pay postage fees for delivery and need to pass this cost onto the customer
41
What are the 4 methods of distribution?
Road, rail, air and sea
42
What are the advantages of road distribution?
-Refrigerated vehicles can be used to transport perishable items -Allows door to door delivery -As road networks improve it is a quick method -It is relatively cheap compared to other methods such as air
43
What are the disadvantages of road distribution
-Can be problems with delays, road works and weather -Cost of fuel rising makes the overall cost increase -Not always suitable to transport to other countries -Legislation restricts how long a driver can operate for this increases costs
44
What are the advantages of rail distribution?
-Ideal for heavy products -Less Restrictions on how long goods can be on the move -Is more environmentally friendly than road
45
What are the disadvantages of rail distribution?
-Requires specialized freight terminals to load products -Not suitable in rural areas with no rail network -Another method is required to get to customer
46
What are the advantages of air distribution?
-Is good for long distances and for transportation across continents/countries -Can access remote areas -Is a faster method for overseas distribution
47
What are the disadvantages of air distribution?
-Can be more expensive than road or rail -Airports are often located a distance from city centres meaning road transport is still required
48
What are the advantages of sea distribution?
-Ideal for heavy or bulky goods -Is good for items that are not time bound -Useful when transporting goods to remote areas e.g. islands in the north of Scotland
49
What are the disadvantages of sea distribution?
-Is a slower method than road, rail or air -Requires additional method beyond port
50
What factors affect the method of distribution?
-The size of the product: large items may often be delivered by rail as they cannot travel safely by road -The distance of delivery: If an item is to travel abroad then it is likely to go by air or sea as road will take to long -How quickly the item is required: UK items will be delivered by road as they can go directly to the location/railway stations are stations are not found in every town -The perish-ability of a product: the method of transport must be capable of keeping the item in a safe way such as refrigerated lorries
51
What are the advantages and disadvantages of a TV advert?
Advantages -Adverts can be targeted at a large audience -Products can be made appealing using catchy, tunes, colour, movement etc. Disadvantages -Can be expensive -Many viewers change channels when adverts come on
52
What are the advantages and disadvantages of a Social Media?
Advantages -Large numbers of customers can be reached -Improves brand loyalty -Cheaper than other methods Disadvantages -Difficult to measure how successful it is -Can cause legal problems if ads are misleading
53
What are the advantages and disadvantages of a Billboards?
Advantages -Usually in a busy location so seen by a large audience -Passer-by will be see the advert frequently Disadvantages -Often suffer from vandalism -Can deteriorate quickly due to weather
54
What are the advantages and disadvantages of a Text pushing/app push notifications?
Advantages -Messages are received instantly -Large number of customers can be targeted -Reminders can be personalised Disadvantages -Can only include a small amount of information -Need access to customers' mobile number or customers need to have the app downloaded
55
What are the advantages and disadvantages of a radio?
Advantages -Much cheaper than TV -listeners don't tend for 'channel hop' or avoid the adverts Disadvantages -It is hard to listeners to imagine the product as they can only hear and can't see it -Listeners often do not pay attention during the adverts
56
What are methods of sales promotion?
-Buy one get one free -Free samples to try before you buy -Giving customers a free item (gift) when they join -Free delivery goods are delivered free of charge
57
What is product placement?
A firm pays for its products to be used in films or TV programmes
58
What is celebrity endorsement?
When famous personalities are paid to wear and use particular product e.g. Taylor swift and diet coke
59
What are the advantages and disadvantages of celebrity endorsement?
Advantages -Consumers associate products with the personality so they will buy the product -Gives a good image to the business/product -Higher prices can be charged -Product has a better chance of success Disadvantages -Expensive large payments to celebrities -If the celebrity gets negative publicity this can affect the image of the business/product
60
What are methods of ethical marketing?
-Using fair-trade products and careful consideration of where raw materials come from -Using less paper in promotions if not necessary -Consider who advertises your product, ensure all areas of your market are represented
61
What are the advantages of ethical marketing?
-The business is more successful as customers trust the business -Can give a good ethical reputation -Can reduce environmental impact of waste if environmentally friendly packaging is used
62
How can technology be used in marketing?
Websites -Websites can be regularly updated and used to display the entire ranges of products -They can accessed by customers 24/7 -Products can be ordered and paid for online and delivered to the place of the customer's choosing Social media -Social media can be used to increase awareness of the product -Promotions and news can be posted to keep followers up to date -Customers can like and share increasing overall awareness Online Surveys -A large number of people can be targeted using online surveys -The surveys can be easily customised to the target market

Business Nat 5 (5 decks)

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