Marketing Mix Flashcards
What is a loss leader
what is one advantage
what is one disadvantage
when price is less than cost
so customers buy other products alongside that are profitable
- stimulates sale of other products
- if not monitored or strategised correctly customers make large quantities resulting in major loss
what are the factors of price
- cost / internal cost = if invest in cheaper to run machinery cost less so price less increasing sales. // if cost go up increase prices
- nature or market - if luxurious market then prices higher
- degree of competition - if too high than competition no sales less than competition for sales
- product life cycle - when growth or intro phase put prices low/high to encourage sale and once in maturity competitive pricing when in decline reduce prices
how can you do product differentiation
- introduce a USP // special new feature
- brand imaging - constantly managing market mix and help increase sales due to loyalty and being chose over by competition
otherwise pick cheaper
what is the product life cycle
Research and development - high cost no sales // testing
introduction - new sales lots of promotion and advertising , place is important here
growth - high sales due to lots of demand well known and established
maturity - demand at peak promotion less require less growth no room for expand
decline - demand falls sales fall require extension or drop
how can businesses employ extension strategies
- adding new features // appealing
- using new packaging// targets new audience eye catching
- targeting new markets // promotional at new markets for sales
- change advertising campaign
- lowering prices
what is the Boston matrix and what does it consist of
analyse portfolio and market share in regards to market growth
question mark - low market share in a growing market require lots of investment
cash cows - high market share high growth maturity phase low cost no promotion
stars - high market share high market growth future cash cows
dogs - low market share low growth
what is the use of Boston matrix
use money from cash cows to invest in question marks to become stars
why do business need a variety of products
- products at different stages of product life cycle give balanced portfolio
some at peak allowing money for investment
some declining so products needed in development or introduction later grow to maturity ] need investment
how can businesses broaden portfolio and why and why not
- adding products to range but different features
- increasing range of products
increases sales as extends lifecycle of existing products
appeal to new market segment stimulating sales
charge higher prices for new products
reduces risk that decline in one product affects profits
costly and could just be unsuccessful
cannot produce at low cost at large cost
can damage reputation
what are the two methods of promotion
sponsorship and Public relation
sponsorship on tv or sport brands - can get bad publicity if image suffer
public relations - little control on what media publishes and easy and cheap method
what are the reasons of promotion
- persuade customers to choose you over competitors
- create or change brand image
- increase sales for profit
- brand awareness and show off USP
What is telesales
when firms directly sell to customers
cheapest but time consuming as customers may be buying small quantities hence delivery of good is difficult and time consuming as all over the place.
good for small firms
why is market research important
identify needs of customer and provide products with needs for satisfy
developing product so find market opportunities or info
how is market research beneficial
- increase sales as knowing demand allow u to adjust price
- stay competitive if you know prices of competitors become strategic
- understanding target market allow effect promotion and sales
what are primary research methods
- questionnaires } cheap large geo
- Phone surveys ) high rate of response
- interviews
- focus groups } quicker than interviewing
