Marketing mix and strategy 1.3 Flashcards
What are 3 main things a business may take into account when assessing the function of a product?
A business will want to assess its safety, if it is fit for purpose and convenient to the consumer.
What are some of the things that should be included when assessing the aesthetics of a product?
Appearance, smell, taste, shape and size, compact…
Why may aesthetics be the most important in the design mix for consumers?
The looks of the product is what catches consumers attention when purchasing a good therefore making it important for it to stand out from rivals.
Why may costs be the most important in the design mix for producers?
The cost to produce the good is what determines if a business is able to afford to produce the good. If it is to expensive to manufacturer then it may be substituted for cheaper materials.
Products for each element that is most important:
Function: tools, housing systems, hiking boots etc
Aesthetics: Fashion, Accessories and jewellery
Costs: Insurances, consumer durables, housing appliances
What is meant by resource depletion?
This is when raw materials/resources are used beyond the rate of replacement.
How can the design mix be implemented when producing a product to ensure waste minimisation?
- changing the function so that it can be used to last longer than it does.
- Can be designed to be more compact and lighter to reduce materials used per unit of output.
- Producing a good that can be used more than once implemented via the design
How can the design mix be implemented when producing a product to ensure it can be re-used?
- Designing goods so that they can be re-used later for the same purpose
- Implementing schemes that are cost-effective such as refunding empty bottles
How can the design mix be implemented when producing a product to ensure it can be recycled?
- Using waste materials to produce products so that your utilising waste to make new products which is cost-effective as well as sustainable
- using old materials which can be used for new materials
What is ethical sourcing?
When a business uses eco-friendly resources, pay fair wages and provide a safe working environment.
Advantages and disadvantages of ethical sourcing?
A = USP, attracts consumers and helps environment D = can be costly, people may only want low priced goods
What is promotion
When a business aims to inform customers about products that they are selling to increase sales.
What are 3 main types of promotion?
Sales promotion, public relations and merchandising and packaging
What is sales promotion?
When a business uses incentives to help increase the chances of consumers continuing to buy their products.
For example, Coupons, loyalty cards and free gifts
What are examples of public relations?
Press releases, press conferences and sponsorships
What are examples of merchandising and public relations?
Product layout, display materials and well-stocked shelves
How might a business choose its method of promotion?
How small/big the business is?
The market the product is in?
The product type?
What is branding?
Allowing a business to be recognisable to consumers through name, brand and logo
What are 3 good things about having good branding?
- Adding value (through using celebs for TV adverts etc)
- premium prices (a good brand has the ability to charge a higher price because customers will remain loyal to them)
- Reduce PED (brand loyal means if price increased, consumers are less price sensitive)
How can a business build a brand?
- Advertising
- Sponsorships
- Using social media
What is cost-plus pricing?
This is when a business calculates the cost to produce a single unit and then add a % mark up to ensure they make profit per unit
What is price skimming? One plus and one con
This is when a business sets the price really high and then eventually decreases the price of it overtime. This is good because it means business can gain maximum profit as their are no competitors in the market but may only work on inelastic demand
What is the difference between penetration pricing and predator?
Predator rapidly decreases prices with an aim to force competitors out of the market whereas penetration allows businesses to gain loyal customers and offer free trails etc
What is psychological pricing. One con and one pro
Psychological is when a business sets a certain prices to make it seem like they are getting a better deal. Adding 0.99 seems cheaper than adding the extra 0.01p
May not always work if customers are price aware
