Marketing Flashcards
What is market share
A firms % of all the sales in the market
E.g. % of I pads in the tablet market
What is market growth
Total increase in sales of a market
E.g. Market for tablet computers
Describe methods of into the pipeline promotion
STAFF TRAINING- manufacturers may offer training where a product is of a technical nature
For example, car manufactures may offer car dealing training to cover technical issues, the best method of promotion and how best to promote customer service
POINT OF SALES MATERIALS- generally provided to the wholesaler or retailer free of charge- includes posters and leaflets.
For example, when a new film comes out, film company will advertise the fill in the cinema adverts
DEALER COMPETITIONS- competitions for high sales can be offered to retailers or wholesalers
For example, car manufactures may offer holidays as prizes for car dealers who meet their sales targets
Describe methods of out of the pipeline promotion
FREE SAMPLES: perfume or Beauty counters often give away free examples to customers to let them try out their product which will hopefully lead to a purchase later on
BOGOF- often use this on selected products in supermarkets
COUPONS AND VOUCHERS- they provide customers with money off future purposes
For example, sainsburys have a price match coupon which means customer will get money of their next shop if they could have bought the products cheaper at another supermarket
COMPETITIONS- customer will purchase a product which will allow them to enter a competition
For example, newspapers may have ‘lucky wallets’ which means the buyer may have a chance of winning money
What is a product line portfolio?
They allow a business to grow internally by developing it’s core products and launching them into existing or new markets
E.g. Frozen the film had success in introducing games and costumes and dolls
What is a diversified product portfolio?
When a business sells a mix of different products
For example , Richard Branson the owner of Virgin now owns virgin airlines and virgin mobile but who can Remember virgin cola?
What are the advantages of a diversified product port folio
- reduces risk of failure of one product as one product might be doing better than another
- appeals to a variety of market segments- different products will appeal to different customers
- increase sales and profits from selling different products- customers will be able to buy variety of products from same busines
- make introducing a new product easier, customers will already be aware of business
What are the disadvantages of a diversified product portfolio?
- costs of promoting and advertising could be high-result in less profit
- if one product receives a bad reputation/image- May impact on all products being sold by business
- staff may require training on different features of different products- time consuming and expensive
What are the 7 P’s of the marketing mix
Product Price Place Promotion Process People Physical evidence
Describe changes that could be made to elements of the marketing mix to achieve a businesses objectives?
PRODUCT: Design Technology Quality Packaging PRICE: Skimming Penetration Cost plus PLACE: Internet Direct sales Mail order Retail Whole saler PROMOTION: Special offers e.g. BOGOF advertisements Celebrity Endorsements PROCESS (the different processes and systems used to deliver the service): Service delivery - systems to minimise waiting times - up to date delivery methods -up to date buying methods e.g. E-commerce , mobile scan PEOPLE( the employees involved in proving the service to customers): Having high quality, high trained, high skilled and motivated staff Train staff Rewarding, encouraging, motivation staff Customer service focus/ training PHYSICAL EVIDENCE (the location of where the service is being offered and what service looks like): Bright well lit, well furnished, modern e.g. Apple Improved signage Facilities Layout
What is into the pipeline promotion
Promotion offered to wholesalers and retailers to encourage them to stock the products
What is out of the pipeline promotion?
Promotions offered to the consumer to encourage them to make a purchase
(Focus on how the retailer can attract customers)
What is above the line promotion? What does I involve
It refers to mass media marketing -seen by a large number of people and a wide range of people -includes people with no interest Examples: TV and radio Newspaper Cinema Social media
What is below the line promotion? What does it involve
Far more targeted and takes place through public relations, sales promotions and direct selling -directly controlled by business -targets specific customer segments Examples: Sales promotions Direct mail Direct selling
What are the different types of purchases a customer can make?
Impulse purchases- buy something without thinking, spur of the moment
Routine purchase
Limited decision making purchases- e.g. Clothes, something that requires some thought before purchasing
Extensive decision making purchases- e.g. Car, house , something that requires a lot of thought before purchasing
What is a core product and an augmented product?
Core product- satisfy the basic needs and wants of customers
E.g. Shampoo- to clear hair
Augmented- in order to gain a competitive edge the must add attractiveness to their product
E.g. Shampoo- image enhanced by designer name e.g. Toni and guy
Name the stages of the product life cycle
Research and development Introduction Growth Maturity Saturation Decline
Describe the stages of the product life cycle
RESEARCH AND DEVELOPMENT:
Where product us us researched, designed and prototype made
No profits due to no sales
INTRO:
Product is launch onto market
Product is heavily advertised
Sales are low , beginning to increase as products are just being introduced to the product
Therefore profits non existent
GROWTH:
People become more aware of product
Advertisement costs still quite high
Modest sales levels
MATURITY:
When products sales and profits are at their highest
Everyone who wants the product has bought It
Advertisement costs paid off
SATURATION
Large number of competitiors in market now
Advertising costs increase as business lets customers know that their product still exists
Profits may remain high but sales start to decrease
DECLINE:
Sales decrease
Product gets taken of market
Profits come to an end
New and more modern products have taken over market
Describe some extension strategies a business may use to prolong the life of a product
- alternating packaging: appeal to new customers
- alternating price
- alternating promotional methods
- find new uses for the product
- improve the product: new improved versions
Describe the role of the marketing department
They aim to make a profit by identifying , analysing and satisfying customers needs and wants
marketing dep identifies customers needs and wants so that they can determine what the customers wants. If goods and services do not reach the customers requirements then they will not buy the product.
Customers trends change often : responsibility of marketing dep to keep up to date with these changes and meet them.
Anticipate customers needs and wants: aim to anticipate what goods and services customers want in the future by looking at current trends- important that business it up to date with trends
Satisfying: responsibility of ensuring customer has high satisfaction by providing high quality services and products that offer value for money.
Aim to produce well designed and packaged goods, deliver them promptly and provide an excellent after sales service
Draw the Boston Matrix
Market growth and market share
Stars- high growth products with high market share
Question marks- high market growth, low market share
Cash cow-low market growth, high market share
Dog- low market growth, low market share
Describe some pricing methods
Skimming- initially setting a high price for new product
Penetration- initially setting low price to attract customers
Destroyer pricing-tactically reducing the price of an existing product to an artificially low level. When competition is eliminated or been eroded, price will increase
Why do businesses use loss leaders as a pricing tactic?
Loss leader: product whose price is sustainably lowered to attract customers into shop
Business tactic: once customers are in the store, they will purchase other items
What is a wholesaler (place)
A wholesaler buys large quantities from the manufacturer and then sells them on to retailers or directly to the consumer in smaller quantities
What is a retailer
A retailer sells the products to the consumer on behalf of the manufacturer
What is a manufacturer
Person who physically produces the goods
What are the benefits (to the manufacturer) of using a wholesaler
- wholesaler buys in bulk- means manufacturer doesn’t have to make large number of small quantities-cuts costs of transportation
- wholesaler bares risk of holding to much stock- without the wholesaler, manufacturer would have more capital tied up in stock
- wholesaler provides advice to manufacturer
What are the costs (to the manufacturer) of using a wholesaler?
- manufacturer looses complete control of product- may not like way product is being portrayed by wholesalers or retailers
- less profit for manufacturer- have not sold directly to consumer
- loyalty cannot be gained
Describe methods of direct selling
Involves manufacturer selling straight to customer
- Personal selling-door to door- allows for detailed descriptions of products to be given by trained employees e.g. Double glazing
- mail order- catalogues etc - more private, customers unable to access shops, wider range in catalogues :but customers may not like lack of personal contact, can’t see product in real life
- TV shopping
- mobile marketing
Name methods of physical distribution that a produce could use to get their product to consumers
Road Rail Sea Air Pipeline- into and out of
What is a product portfolio?
The range of products a business has
Describe factors influencing the choice of distribution methods
- the product itself and it’s life cycle: perishable products e.g. Fruit need quick channel of distribution
- finance available to the organisation: if it is too expensive to have retail outlets, manufacturers might use wholesalers who can save them the expense of labelling and packaging
- reliability of wholesaler and retailers: if past experiences have been unreliable manufactures will probably sell direct to customers
Describe product led organisations
Focuses on producing a technically sound product or service and then presenting it to the market once it is developed
No market research is done, contact with consumer is only when the product is released into market
Usually the products are new inventions, or a technically unique product
Products have a USP
The advantages and disadvantages of a product led organisation
Adv:
-businesses can focus on quality of their product and take their time in production
-business could invest in technology and apply it to their product/ services
dis:
-the actual needs of the market are completely ignored
-any changes for tastes in fashion will not be a accounted for
Describe market led organisations
Continually identifies, reviews and analyses customers needs
Business will modify their product to any changes in the market
The desire to satisfy customers needs at the priority of this strategy
The advantages and disadvantages of market led organisations
Adv:
-the business can identify any market changes and is flexible enough to react quickly due to it’s constant use of market information
-more confident in launching new products as they have done research
Dis:
-market research is expensive
-future is unpredictable - high risk of failure
-constant change within the business as it meets the needs of the market and stays ahead of competitors
Name some methods of field research
Should know their adv and disadvantages also
- surveys: telephone, online, postal
- personal interview
- observation
- test marketing
- social networking
What are the 3 types of sampling an organisation could use to carry out field research
Random sampling
Stratified random sampling
Quota sampling
Describe random sampling
- people are pre-selected from a list e.g. Phone book , and the interviewer then randomly chooses a number of people from that list to phone
- time consuming
- costs increase
- May not be representative of whole population
Describe statified random sampling
More representative of the population as a whole
Sample is divided by knowledge about how the population is divided up
Covers variables such as income and location
Describe quota sampling
People are selected on a basis of characteristics that they share such as age, gender or occupation
Ways of market segmenting
Religion Characteristics Location Age Gender
Advantages of market segmentation
- improved customer satisfaction
- customer loyalty
- new sales opportunities as new segments can be targeted
- costs of advertising are less
Describe some pricing strategies
-low price: often used to attract sales of products that have lots of competition
High price: charging a high price to certain customers (luxury products)
Market skimming: initially set product with a high price and customers will rush to buy one , as novelty wears of business will reduce price
Penetration pricing: initially set price of product lower than competitors to attract customers quickly and make sales (normally do this when entering a new market )
Promotional pricing: price is lowered for a short time to draw attention to product- business is trying to boost sales or create interest in a. Ew one
Loss leader: products priced very low to Intice customers into shop- the idea being that once they are in the shop they will buy more expensive products
Name different types of sales promotion
Public relations Advertising Product endorsement Product placement Above the line and below the line
Advantages and disadvantages of celebrity endorsement
Adv:
- Consumers buy product in attempt to be same as celebrity
- higher prices can be charged
- brand loyalty
- photographs can be used to create visual connections to the product
Dis:
- costs large amounts
- if celebrity gains bad publicity the product is also tarnished
- does not guarantee quality product
Methods available to public relations department to improve the image of an organisation
Hosting a press conference to inform public of a new product
Giving factory tours to the press
Organising charitable donations
Generating press releases
How does a business carry out ethical marketing practises
- market research : invasion of privacy , stereotyping
- advertising and promotions: truth and honesty, use of violence, sex and profanity , controversial advertising
- target market: when vulnerable groups are being targeted e.g. Children
Factors influencing choice of distribution channel
- the product itself and it’s lifecycle
- finance available to business
- legal restrictions
- reliability of wholesaler and retailers
Advantages and disadvantages of e-commerce
Adv:
- shop 24/7
- customers can compare prices to get best deals
- businesses can target a large amount of people
- no need for expensive retail outlet
- quite cheap to set up
Dis:
- don’t get to see what they are physically buying
- time consuming to have entire product range available online
- websites sometimes crash
- returning goods can be difficult
Advantages and disadvantages of direct selling
Adv:
- don’t need to worry about the manufacturer damaging their products
- direct to customer - one on one service
- increase customer loyalty
Dis:
-expensive for business
Methods of direct selling
Internet Direct mail Telephone E-mail marketing Mail order
Describe the extended marketing mix
PROCESS-
The ways of delivering the service
E.g. Helpfullness of staff, quality of information given
PEOPLE-
anyone who comes into contact with your customers that will have an affect on customer satisfaction
PHYSICAL EVIDENCE-
The tangible aspect of delivering the service e.g. The building
Describe product led organisations
Focuses on producing a technically sound product or service and then presenting it to the market once it is developed
No market research is done, contact with consumer is only when the product is released into market
Usually the products are new inventions, or a technically unique product
Products have a USP
The advantages and disadvantages of a product led organisation
Adv:
-businesses can focus on quality of their product and take their time in production
-business could invest in technology and apply it to their product/ services
dis:
-the actual needs of the market are completely ignored
-any changes for tastes in fashion will not be a accounted for
Describe market led organisations
Continually identifies, reviews and analyses customers needs
Business will modify their product to any changes in the market
The desire to satisfy customers needs at the priority of this strategy
The advantages and disadvantages of market led organisations
Adv:
-the business can identify any market changes and is flexible enough to react quickly due to it’s constant use of market information
-more confident in launching new products as they have done research
Dis:
-market research is expensive
-future is unpredictable - high risk of failure
-constant change within the business as it meets the needs of the market and stays ahead of competitors
Name some methods of field research
Should know their adv and disadvantages also
- surveys: telephone, online, postal
- personal interview
- observation
- test marketing
- social networking
What are the 3 types of sampling an organisation could use to carry out field research
Random sampling
Stratified random sampling
Quota sampling
Describe random sampling
- people are pre-selected from a list e.g. Phone book , and the interviewer then randomly chooses a number of people from that list to phone
- time consuming
- costs increase
- May not be representative of whole population
Describe statified random sampling
More representative of the population as a whole
Sample is divided by knowledge about how the population is divided up
Covers variables such as income and location
Describe quota sampling
People are selected on a basis of characteristics that they share such as age, gender or occupation
Ways of market segmenting
Religion Characteristics Location Age Gender
Advantages of market segmentation
- improved customer satisfaction
- customer loyalty
- new sales opportunities as new segments can be targeted
Describe some pricing strategies
-low price: often used to attract sales of products that have lots of competition
High price: charging a high price to certain customers (luxury products)
Market skimming: initially set product with a high price and customers will rush to buy one , as novelty wears of business will reduce price
Penetration pricing: initially set price of product lower than competitors to attract customers quickly and make sales (normally do this when entering a new market )
Promotional pricing: price is lowered for a short time to draw attention to product- business is trying to boost sales or create interest in a. Ew one
Loss leader: products priced very low to Intice customers into shop- the idea being that once they are in the shop they will buy more expensive products
Name different types of sales promotion
Public relations Advertising Product endorsement Product placement Above the line and below the line
Advantages and disadvantages of celebrity endorsement
Adv:
- Consumers buy product in attempt to be same as celebrity
- higher prices can be charged
- brand loyalty
- photographs can be used to create visual connections to the product
Dis:
- costs large amounts
- if celebrity gains bad publicity the product is also tarnished
- does not guarantee quality product
Methods available to public relations department to improve the image of an organisation
Hosting a press conference to inform public of a new product
Giving factory tours to the press
Organising charitable donations
Generating press releases
How does a business carry out ethical marketing practises
- market research : invasion of privacy , stereotyping
- advertising and promotions: truth and honesty, use of violence, sex and profanity , controversial advertising
- target market: when vulnerable groups are being targeted e.g. Children
Factors influencing choice of distribution channel
- the product itself and it’s lifecycle
- finance available to business
- legal restrictions
- reliability of wholesaler and retailers
Advantages and disadvantages of e-commerce
Adv:
- shop 24/7
- customers can compare prices to get best deals
- businesses can target a large amount of people
- no need for expensive retail outlet
- quite cheap to set up
Dis:
- don’t get to see what they are physically buying
- time consuming to have entire product range available online
- websites sometimes crash
- returning goods can be difficult
Advantages and disadvantages of direct selling
Adv:
- don’t need to worry about the manufacturer damaging their products
- direct to customer - one on one service
- increase customer loyalty
Dis:
-expensive for business
Methods of direct selling
Internet Direct mail Telephone E-mail marketing Mail order
Describe the extended marketing mix
PROCESS-
The ways of delivering the service
E.g. Helpfullness of staff, quality of information given
PEOPLE-
anyone who comes into contact with your customers that will have an affect on customer satisfaction
PHYSICAL EVIDENCE-
The tangible aspect of delivering the service e.g. The building
The advantages and disadvantages of an observation
Adv: get to see the customers personal response to the product
Dis: time consuming for the business , may need to hire more staff to do this
Advantages and disadvantages of hall tests
Adv: In depth information can be obtained
Increase business sales
Dis: can’t analyse the information received in depth (quantitative)
Advantages and disadvantages of a personal interview
Adv:
Get clarification
Face to face- get to see body language and facial expressions - helps you to understand person better
Dis: time consuming- individual surveys
Advantages of staff training to an organisation
- Staff will be more motivated and more happier at their work which will improve performance
- improve quality of products-improved customer relations
- improve image of organisation-attract high quality staff
- reduced staff turnover
- allow business to be more flexible in the market place as more people will wish to work for them
The impact of industrial action on an organisation (describe different types of industrial action)
Strike: people refuse to carry out their work- no products are being made and sold
Overtime ban: employees refuse to work overtime which can mean customers orders can be late
Go slow: employees work at a slower rate than normal- increase costs of production
Sit in: employees do not work but still come to work
Work to rule:employees only do the tasks that are stated in their job description and nothing else-results in job taking longer to do
BENIFITS OF MARKET RESEARCH
- keeps organisation ahead of competitios
- ensures products meet the needs of customers
- helps identify a space in the market
- reduces risk/failure when launching a new product
