marketing mix Flashcards
what are the axis for Boston Matrix
market share and market growth
what does distribution channel one include
producer-> wholesaler-> retailer->consumer
what does distribution channel two include
producer-> retailer->consumer
what does distribution channel three include
producer->consumer
what are the 4 factors that businesses need to consider before setting up a store
- cost (rent)
- coverage
- convenience to consumers
- control of the market
how can a business benefit by selling with a retailer
- may sell more products as they use a reliable brand to sell their new product
- exclusivity deals may be signed to gain further market share over competitors
which type of industry will especially benefit from selling with a retailer
- a firm selling food
- a firm selling in an unknown market abroad
- luxury goods selling through Selfridges and harrods
what are 2 negatives of using longer distribution channels
- more delivery cost
2. the producer earns less profit as it may have to sell the product to the retailer at a reduced cost
what is above the line marketing
advertising
using paid media outlet to inform consumers about a businesses product
(tv advertising mass appeal)
what is below the line marketing
advertisement that doesn’t include a paid media outlet
what’s a negative of advertising on tv
- less targeted
2. very expensive
3 examples of below the line marketing
- targeted search engine marketing
- direct mail
- sponsorship
penetration pricing
selling at a low price compared to competition and raising the price overtime as consumers develop brand loyalty
price skimming
selling at a high price at release then lowering the price overtime as product to target the markets where demand is less inelastic
when is penetration pricing necessary
- when the market has high brand loyalty to existing brands
- if demand for product is elastic
- saturated market
when is price skimming necessary
when a business with high brand loyalty is releasing a new product
eg ps5
loss leadership
selling a product below cost to encourage purchase of other goods
eg Nike selling cheaper jumpers but more expensive joggers
psycological pricing
making product appear cheap by selling at a price ending in 99
discrimination pricing
selling the same product at different prices in different markets
what are the different stages of the product lifecycle
- R+D
- introduction
- growth
- maturity
- decline
what is a product with a high market share and high market growth called
star
what is a product with a high market share or a low market growth
cash cow
what is a product with a low market share or a low market growth
dogs
what is a product with a low market share or a high market growth
question marks
why may a question mark product be problematic
heeds lots of promotion to benefit from growing market share
why do we want a cash cow
revenue can be used to innovate other products and develop a wider product portfolio
Ansof matrix
a model which determines which growth strategy carries the most risk
draw the ansof matrix
- market penetration
- market and product development
- differentiation
Why may smaller businesses benefit from using the ansof matrix
it is important for smaller businesses to assess their risk as a failure in investment may cause the business failure especially if a loan is taken out
what is market development
- selling in international market
2. different pricing policies
when may market development be beneficial
- when there is a lot of competition in domestic market
2. when there is high demand in another market
what is product development
developing new products or features but selling at the same price
what is diversification
selling a new product in a new market
Draw porters generic strategy
nice
problems with selling with a retailer
- unsure on how the product is going to priced
- no control on marketing
- may be sold directly next to competition
why may lower costs benefit a business
- may mean they can lower prices and maintain profit margins.
- increased profit margins may be used in product development or advertising
