Marketing Flashcards
What does the product life cycle describe?
The stages a product goes through from the beginning where it is first thought of right until it is removed from the market
What is marketing?
Understanding your customers needs and adapting your marketing mix to give them what they want
What are the 4 main stages of the product life cycle?
Introduction
Growth
Maturity
Decline
Why do branded goods enjoy continuous growth?
The product is constantly bring improved and advertised and maintains a strong brand loyalty
Where, on the product life cycle, would you see negative cash flow?
Development and introduction
What is a key problem with the product life cycle?
Few products finish the product life cycle. The length of each stage differs depending on the product, some even go straight from introduction to decline
What makes a successful product?
Finding a gap in the market and creating a product that fits in that gap
Appealing
Reliability
What is a product range?
Many companies we know produce a range of products to reach different segments of the market
What is an example of a product range?
Apple: ipad-workers, kids
iPhone-everyone
iMac-workers
What is the Boston matrix?
A process used by a company to know where each of their products are in terms of market share and growth.
What are the 4 categories in the Boston matrix?
Star
Cash cow
Question mark
Dog
What is the star?
High market share, high market growth
What is the cash cow?
Low market growth, high market share
What is he question mark?
High market growth, low market share
What is the dog?
Low market share, low market growth
What is the strategy for the question mark?
Build market share by using the 4 p’s
What is the strategy for cows?
Invest just enough to keep the product in its current position
‘Milk’ then for cash to spend on other products
What is the strategy for stars?
Reduce investments and promotions and raise prices in order to maximise the short-term cash flows and profits from the products
What is the strategy for dogs?
Products can phase out or sell the product in order to use the resources elsewhere
What is market share?
The percentage share of the market at any time. Business owners can control this
What is market growth?
Value of sales that changes in a minute. Change in the whole market over time
What is cost plus pricing?
Cost of making then adding a price onto it, making a profit
What is competitor pricing?
Look what competitors are charging and either match it or make your product cheaper
What is penetration pricing?
Go into the market at a low price and then rise prices as you’re going through the market
What is an example of penetration pricing?
Magazine collectibles
What is premium pricing?
Charge high prices to show that it’s expensive and has high quality
What is promotional pricing?
Sales over short periods of time in order to get rid of stock
What is psychological pricing?
Prices at £3999 look better than £4000 making you think you are spending less
What is loss leader?
Well something at a loss to get people to buy other things
What is deferential or differentiated?
Charge different target audiences different prices for identical products
What are some examples of the role of packaging?
To be attractive Appeal to target audience Sanitation Informative To hold the product
What are the 3 channels of distribution?
Traditional
Modern
Direct
Where does the traditional channel go?
Producer
Wholesaler
Retailer
Consumer
Where does the modern channel go?
Producer
Retailer
Consumer
Where does the direct channel go?
Producer
Consumer
What is an example of a business which used the direct route?
Small furniture shops who make the products
What is a promotion?
An attempt to retain and obtain customers by drawing attention to a firm or its products
What does promotion have to depend on?
Competitiveness in the market
The availability of the product
Stage of the product life cycle
How different is the product to the competition
What are the two types of promotions?
Above the line
Below the line
What is above the line promotion?
Promotion that everyone will see and is mainly media based e.g. Tv adverts
What is below the line promotion?
Aimed at certain people and it not media based normally e.g. Merchandising
What is a brand?
A sign, symbol, term, design, or any other feature that allows consumers to identify the goods and services from competitors
What are 5 reasons for branding?
Help make customer choice easier Customer loyalty Differentiate the product Make demand less elastic Increase the value of the company
What does make demand less elastic mean?
Is price increases, demand stays the same
How has the internet impacted on prices of products?
Customers can easily look and see which are providing the best deal- don’t have to drive to every shop
Businesses can see what others are charging
How has the Internet impacted on product?
Made shopping easier so products could stay in maturity longer and away from decline- products shown in detail so customers know exactly what they’re getting
Customers can research product in detail and can do it quicker and this is appealing-stay in maturity
How has the Internet impacted on place?
Allowing businesses to sell online-good for those who live far away or those who have trouble getting around
Distribution channels can include warehouses from places without a shop
How has the Internet impacted on promotion?
Advertise online-above the line promotion
Online used daily so lots of people will see the promotion online
Increase the knowledge of the business and increase sales
What is international marketing?
Involves the firm in making one or more marketing mix decisions across national boundaries
What are some reasons for marketing products internationally?
Increase profile Increase brand awareness Increase market share and sales Economies or scale Economic advantages-tax Gap in the market
What are the 6 main international marketing problems? E C T D L C
Economic Cultural Technological Distribution Legal Competitors
What are some economical features that can cause problems for international marketing? And how do they impact the marketing mix?3
Exchange rates- change price of products
Tax
how wealthy the country is
What are some cultural features that can cause problems for international marketing? And how do they impact the marketing mix? 3
Language barrier- product name
Work ethics- promotions
Religious issues- products
What are some technological features that can cause problems for international marketing? And how do they impact the marketing mix?3
Some countries aren’t as developed (no internet)-no promotions
Facilities available- no buying online
Too high technological developed
What are some distribution features that can cause problems for international marketing? And how do they impact the marketing mix?3
Online distribution- place sold
Transport - unreliable, quality
Infrastructure
What are some legal features that can cause problems for international marketing? And how do they impact the marketing mix?4
Regulations
Employing people
Tax
Alcohol- countries don’t allow it
What are some competitor features that can cause problems for international marketing? And how do they impact the marketing mix?3
Amount of competitors-promotions
Loyalty of customers- products
Knowing the market- price
What 4 factors influence the choice of distribution channel?
The cost
The market
The product
The company
How does the market influence the choice of distribution channel? 3
Is it a wide market?
Competition
Or a small geographically confined market?
How does the cost influence the choice of distribution channel? 1
The longer the chain, the higher the price
How does the product influence the choice of distribution channel? 4
Depends what the product is, is what decides the channel
Heavy?
Made to customers individual needs?
Easily broken?
How does the company influence the choice of distribution channel? 2
Does it have its own transport?
does it have lots of outlets?
