Marketing Flashcards
(101 cards)
1
Q
marketing
A
meeting the wants and needs of customers so that marketings primary aim of increasing sales can be met
2
Q
the marketing mix
A
4 Ps of marketing
price, product, promotion, place
each part affects the other
3
Q
promotion
A
collection of techniques used to inform+persuade customers to buy a product or service
4
Q
above the line promotion
A
uses media where there is no direct contact with potential customer
5
Q
television advertising (above the line promotion)
A
reaches mass audiences
visual+sound easy to remember
very expensive
6
Q
billboards (above the line promotion)
A
busy roads+traffic lights
more cost effective than tv
people less exposed bc they’re static
content needs to be concise
7
Q
below the line promotion
A
business can contact customer directly
8
Q
below the line promotion techniques
A
email personal selling telesales (phone) product sampling leaflet distribution trade fairs
9
Q
personal selling
A
direct link between a customer and a sales persons
inclu. sales assistants,door to door+telesales
10
Q
advantages of below the line promotion
A
target those who shown genuine interest in product
offer personalised service
11
Q
disadvantages of below the line promotion
A
customers become frustrated so media is ignored
12
Q
Above the line promotion techniques
A
Billboards Tv advertising Radio Magazines Cinema Sponsorship
13
Q
Radio (above the line promotion)
A
Locally Reach large group Doesn’t need full attention Change radio station Expensive prime time spots
14
Q
Magazine (above the line promotion)
A
Target certain group Well respected mag association Pass on to friends Flick past it Put at the back with others
15
Q
Cinema (above the line promotion)
A
People from all sections of society Big impact big screen Audience can’t turn it off Arrive late Limited exposure
16
Q
Sponsorship (above the line promotion)
A
Sports persons/team Product awareness Positive association Bad actions of sponsor linked Lack of control brand displayed wrong
17
Q
Newspapers (above the line promotion)
A
National or local
18
Q
what are the other two types of below the line promotion
A
branding
social media
19
Q
branding
A
powerful for people to want to be associated with your brand
helps boost sales
20
Q
social media
A
business website+social media pages directing target consumers
21
Q
advantages of social media as a below the line promotion technique
A
more cost effective
personal customer interaction
social med boost traffic to website
easy to measure success
22
Q
three social media strategies for promotion
A
cold sell
influencers/ambassadors
organic posts
23
Q
disadvantages of social media
A
fail to respond/engage on sm=bad rep
costs of someone running it
influencer controversy
24
Q
price
A
amount of money given up to obtain a good/service
25
cost plus pricing
adds % cost of making product to selling price
26
competitor pricing
based on prices charged by competitor
| this price often lower to gain sales from rivals
27
price skimming
product more advanced/customers want to associate wi a particular brand
price is set higher
customers willing to pay
28
penetration pricing
business new to market
set prices lower to break customer loyalties
short term
29
marginal pricing
fixed+variable cost covered by current output
| cost of producing extra unit only compromise variable cost
30
contribution pricing
price covers variable cost and gives a contribution to the fixed cost
31
psychological pricing
appeals to emotion over rational repsonses over price
| e.g 0.99- would round down not up
32
price elasticity of demand formula
% change in demand/% change in price
33
how do you work out % change in demand
from a demand graph
34
what does it mean if price elasticity of demand is over 1
elastic in relation to price
35
what does it mean if price elasticity of demand is 1
its unit elastic (15% rise in price=15% contraction in demand)
36
what does it mean if price elasticity of demand is between 0-1
inelastic in relation to price
37
what does it mean if price elasticity of demand is 0
perfectly inelastic
| demand doesn't change when price does
38
What type figure does price elasticity usually come out as
Negative
| Follows law of demand
39
Income elasticity of demand
Measure responsiveness of demand with changes in income
40
Formula for income elasticity of demand
% change in QD/ % change in income
41
What does it mean if income elasticity is more than one
They’re luxury products
42
What does in mean if income elasticity of demand is less than 1 but more than 0
Product is a necessity
43
Define cross price elasticity of demand
Responsiveness of demand for good x following a change in the price relating for good y
44
Formula for cross price elasticity of demand
% change in demand for good x/ % change in price for good y
45
Substitutes (cross price elasticity of demand)
Close substitutes have a strongly positive cross price elasticity
46
Complement (cross price elasticity of demand)
Strong relationship, highly negative
47
Unrelated products (cross price elasticity of demand)
Products have zero cross elasticity
48
Summary points for elasticity formulas
Marketers decide wether to increase/decrease price
Assumes you will know what happens demand as a result of a change in variable
This info won’t always be available/accurate
49
Product life cycle
Theoretical model which describes stages that a product goes through overtime
50
Four stages of the product life cycle
Introduction
Growth
Maturity
Decline
51
Key points of intro stages of product life cycle
Sales initially slow
Heavy promotion
Cash flow could be an issue
Penetration pricing used
52
Key points of growth stage of product life cycle
```
Sales increase quick
Competitors become interested
High promotion spending continues
Adoptions to product made
Increase distribution
```
53
Key points of maturity stage of product life cycle
Weak rivals leave market
Defend position from remaining comp
More improvement to product
Positive cash flow likely
54
Key points of decline stage of product life cycle
Tech advance,eco conditions + fashion fads=cause of decline
Drastic price fall (cost plus wi small %)
Limit distribution
55
What is an extension strategy
Product starts to decline
Don’t withdraw
use strategy to bolster sales
56
What are potential extension strategies
```
Advertising (potential new audience)
Price reduction (more attractive)
Add value
Explore new markets (new geographical)
New packaging
```
57
Benefits of a product life cycle
Helps with planning
| Spot trends in previous life cycles, avoid pitfalls
58
Cons of the product life cycle
Too rigid e.g sales might dip in intro then rise again
| Self fulfilling- product looks in decline so is discontinued, but just be a dip
59
Product positioning chart
Plotting products on a grid
| In relation to two important market features
60
Why would marketers want to position a product in a highly saturated area of the market
Suggest high sales volume
61
Product portfolio
Collection of products produced by a business
62
How can a business analyse its product portfolio
With a product positioning chart
63
Why would a business want to ensure it has multiple products in a market
```
Increase sales
Meet needs of multiple customer groups
Compete with rivals
Reduce risk
Increase brand recognition
```
64
Boston Matrix
Tool used to identify where to allocate investment
| Categorises products into one of four areas based on market share and growth
65
Four areas of Boston Matrix
Question marks (problem child)
Stars
Dogs
Cash cows
66
Summarise stars (Boston Matrix)
High growth products
Heavy investment to sustain growth
Growth will slow but if maintain market share will become cash cows
67
Summarise dogs (Boston Matrix)
Low market share in low growth market
Might have enough cash to break even, rarely invest
Usually closed/sold
68
Summarise question marks/problem child (Boston Matrix)
Low market share, high growth market
Have potential but need substantial investment
Hardest products to make decisions on
69
Summarise cash cows (Boston Matrix)
Low growth product, high market share
Little need for investments
Need to be managed for consistent profit
Can generate strong cash flow to fund stars
70
Benefits of the Boston Matrix
Identify stars to invest in
Identify cash cows to reduce investment
See which question marks to invest in
71
Why is the Boston Matrix limited
Other indicators which determine which stars to invest
Cash cows may still require advertising to maintain market share
Doesn’t identify the question marks to invest in
72
Define place
How the product is distributed
73
Channels of distribution
Provides link between production
74
Retailer
Responsible for selling the final product to the consumer
75
Types of retailing
```
Multiples (chains)
Department (John Lewis)
Convenience (costcutter)
Independents (shop run by owner)
Franchises
```
76
Key trends in retailing
Growth in out of town stores
Decline in independents
Increased use of tech in retailing
77
Role of a wholesaler
Good for producers can’t deal wi every shop it sells to
Help small shops (can’t bulk)
Have own logistics
Allow producer+retailer focus on specialist areas
78
Agent
Negotiate between seller+buyer
| E.g admiral
79
Key points about agents
Tertiary sector
Usually on commission
Don’t hold stock
Reduce cost of marketing
80
What is channel 3 also called
Direct marketing
81
Why have channels of distribution changed
From 1-2= increase size of supermarkets
| From 2-3= internet sales
82
What is online distribution
Tangible product being purchased online
| Delivered by physical distribution
83
What is digital distribution
Electronic methods to deliver good
| Downloadable
84
Advantages of online distribution
Geographical reach increase
Overhead lower e.g don’t need physical stores
Open all times
85
Drawbacks of online distribution
Shipping+returns complicated
High initial capital investment
Some like to try before buy
Security problems
86
Advantages of digital distribution
Convenient
No physical stores
No delivery costs
87
Disadvantages of digital distribution
Not suitable for all products
Customers need Internet
Ongoing cost of systems+security
Illegal streaming competition
88
Physical distribution
Physical method business used to distribute goods
89
Types of physical distribution
Air-perishable
Road-smaller distance
Sea shipping- big bulky products
90
Service marketing
How business increases sales for an activity that a business does for you. Intangible in nature
91
Additional 3 Ps/ extended marketing mix
People
Process
Physical evidence
92
People extended marketing mix
Make contact with customer to deliver product
93
Process extended marketing mix
Systems and processes that deliver a product to a customer
94
Physical evidence
Elements of the physical environment the customer experiences
95
Viral marketing
Use of social media sites to increase brand awareness
| Will be shared like a computer virus
96
Drip marketing
Automated process send a set of messages
| E.g ‘new season’ emails from clothes brands
97
Why does drip marketing work
Increases visibility
| Remind customer of business
98
Why does viral marketing work
Shared instantly
99
Examples of physical evidence
Uniform
Appearance
Cleanliness
100
Examples of process
Website layout
Booking
Mobile apps
101
Examples of people
Customer service
Friendliness
Capability
