Marketing Mix Flashcards
What is price skimming
Setting a high introductory price and decreasing it over time
What is penetration pricing?
price of a product is initially set low to rapidly reach a wide fraction of the market and initiate word of mouth
What is competition based pricing?
price is determined more by the price of a similar product sold by a powerful competitor than by considerations of consumer demand and cost of production
What is psychological pricing
based on the theory that certain prices have a psychological impact
What is cost-price pricing
selling price of a product is determined by adding a specific fixed percentage to the product’s unit cost
What is marginal pricing
the marginal cost is the change in the total cost that arises when the quantity produced is incremented, the cost of producing additional quantity.
What is contribution pricing
pricing strategy which works without any mention of gross margin percentages.
What is price elasticity of demand
a measurement of the change in consumption of a product in relation to a change in its price.
What is income elasticity of demand
economic measure of how responsive the quantity demand for a good or service is to a change in income.
Cross elasticities of demand
evaluates the relationship between two products when the price in one of them changes
Evaluate the usefulness of price elasticity of demand
to create inelastic demand for the products they market. They achieve that by identifying a meaningful difference in their products from any others that are available
The importance of price to stakeholders
it defines the value that your product are worth for you to make and for your customers to use
Channels of distribution
direct selling, selling through intermediaries, dual distribution, and reverse logistics channels.
What is promotion
The marketing communication used attract the target audience of the business
Distinguish between above and below the line promotion
Above the line is generalised brand awareness and below is for fostering direct customer contact
What is branding
The way to identify the business whether by name, logo, slogan etc
What is personal selling
Where sales representatives meet with a potential client for the purpose of transacting a sale
What is social media
A social media outlet used to showcase the business which can be more personal to a customer or generalised eg instagram
What is the importance of promotion
Sets the business apart from competitors in order inform, persuade and show potential customers the good aspects of purchasing from them
What is drip marketing
Pre-written messages sent over a standardised time to a customer to remind them of the businesses existence
What is viral marketing
Using media that has gone ‘viral’ allowing the information to be passed on by shares/ word of mouth rapidly
What is advertising elasticity of demand
Measures the effects of increase and decrease of advertising in a market
Advertising elasticity of demand formula
dividing the percentage change in the quantity demanded by the percentage change in advertising expenditures
