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HSC Business Studies > Marketing Strategies: 4Ps > Flashcards

Marketing Strategies: 4Ps Flashcards

1
Q

What is market segmentation?

A

Breaking the market into smaller groups - either to have different brands/products for each segment, or to only focus on one of the segments

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2
Q

What are the ways you can segment a market?

A
  • Psychographic
  • Demographic
  • Geographic
  • Behavioural
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3
Q

What is psychographic segmentation?

A

Separating the market based on people’s preferences or values

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4
Q

What is demographic segmengtation?

A

Separating the market based on people’s characteristics, such as age, gender or ethnicity

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5
Q

What is geographic segmentation?

A

Separating the market based on where they are located

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6
Q

What is behavioural segmentation?

A

Separating the market based on their interactions with the business (e.g. how often they purchase, when they purchase, how loyal they are)

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7
Q

Why is segmentation a useful marketing strategy?

A

By focusing on one market segment, you can better meet their preferences to increase sales

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8
Q

How can a business differentiate its product as a marketing strategy?

A
  • Product features
  • Customer service
  • CSR
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9
Q

What is positioning?

A

The image of the brand relative to competitors

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10
Q

Why is positioning a useful marketing strategy?

A

By having a unique brand image, the business can stand out from rivals to increase sales

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11
Q

What is the case study for market segmentation?

A

Unilever - Lynx, Dove, Rexona

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12
Q

What does ‘product’ mean as a marketing strategy?

A
  • The product features
  • The branding
  • The packaging
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13
Q

What are four benefits of good packaging?

A
  • Protects the product
  • Easy to transport
  • Attracts customers’ attention
  • Indicates the quality of the product
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14
Q

What are three benefits of branding?

A
  • Customers trust the business’ reputation
  • Increases customer loyalty
  • Can launch new products under the same brand
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15
Q

What is the case study for product strategies in marketing?

A

Coca-Cola - ‘share a Coke’ campaign and recyclable bottles

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16
Q

What are the pricing methods?

A
  • Cost-based
  • Competition-based
  • Market-based
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17
Q

What is cost-based pricing?

A

Look at how much it costs to produce, and add a profit margin

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18
Q

What is the benefit of cost-based pricing?

A

It is simple and guarantees a fixed profit margin

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19
Q

What is competition-based pricing?

A

Look at rivals’ prices and set prices either below, the same or above them depending on your positioning

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20
Q

What is the benefit of setting prices below competitors?

A

Attracts sales because you are cheaper

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21
Q

What is the benefit of setting prices above competitors?

A

Improve the perception of quality

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22
Q

What is market-based pricing?

A

Changing prices when there is a change in demand (how much people want to buy) or a change in supply (how much of the product is available to buy)

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23
Q

What is an example of increasing prices if there is a change in demand?

A

Flight prices go up in school holidays

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24
Q

What is an example of increasing prices if there is a change in supply?

A

Prices of fruit go up when they are not in season (i.e. not growing)

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25
Q

What is the benefit of market-based pricing?

A

Can adapt to changes, so can exploit periods where there is a shortage of the product and still make sales when demand for your product is low

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26
Q

What is the case study for market-based pricing?

A

Uber - surge pricing

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27
Q

What are the pricing strategies?

A
  • Price skimming
  • Price penetration
  • Loss leader
  • Price points
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28
Q

What is price skimming?

A

Setting the price high initially when you release a new product

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29
Q

What is price penetration?

A

Setting the price low initially when you first enter a market

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30
Q

What is the benefit of price skimming?

A

Maximise profit when the product is popular and you have little competition

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31
Q

What is the benefit of price penetration?

A

Gain market share from other rivals who already have a reputation and loyal customers

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32
Q

What is a loss leader?

A

Selling a product for below the cost of production

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33
Q

What is the benefit of a loss leader strategy?

A

Customers come to buy the cheap product, and buy other products while they are there

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34
Q

What are price points?

A

A price at which demand for a product will be relatively high, and usually offered as part of a range of prices for customers to choose from (e.g. our $20 range, our $40 range)

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35
Q

What is the benefit of a price points strategy?

A

Is a memorable and attractive price, and often has multiple options so customers willing to spend more can choose a premium range

36
Q

What is the disadvantage of a cost-based pricing method?

A

May not maximise sales revenue

37
Q

What is the disadvantage of a competition-based pricing method?

A

Would reduce profit margins if they are cheaper than competitors

38
Q

What is the disadvantage of a market-based pricing method?

A

Needs to be changed frequently

39
Q

What is the disadvantage of a price skimming pricing strategy?

A

Doesn’t work if there are many competitors

40
Q

What is the disadvantage of a loss leader pricing strategy?

A

Costs money and is risky

41
Q

What is the disadvantage of a price points pricing strategy?

A

May not consider the cost of the product (i.e. some items in the $20 range might have cost $19 while others $12 to produce)

42
Q

What is the case study for price penetration?

A

Netflix - started at $8.99 vs Foxtel’s $50

43
Q

What is the case study for price skimming?

A

Sony - the PS4 started with a premium price and fell by 25% within 3 years

44
Q

What is the case study for loss leader?

A

Sony - the PS5 makes profit on games and online subscriptions

45
Q

What is the interaction between price and quality?

A
  • Higher prices give the impression of higher quality
  • Higher quality usually costs more, so prices need to be higher
46
Q

What are the promotion strategies?

A
  • Advertising
  • Sales promotion
  • Personal selling
  • Relationship marketing
  • Public relations and publicity
  • Word of mouth
  • Opinion leaders
47
Q

Why is advertising a useful marketing strategy?

A

Increases awareness

48
Q

Why is sales promotion a useful marketing strategy?

A

Attracts customers to try the product

49
Q

What is sales promotion?

A

Discounts, offers and samples to entice customers

50
Q

What is personal selling?

A

Salespeople talking to customers

51
Q

Why is personal selling a useful marketing strategy?

A

Convince customers by addressing their specific questions or concerns

52
Q

What is relationship marketing?

A

Developing a long-lasting connection with customers, such as loyalty programs and newsletters

53
Q

Why is relationship marketing a useful marketing strategy?

A

Build customer loyalty and repeat sales

54
Q

What is public relations?

A

Actions taken to create favourable public image, such as events, interviews and CSR

55
Q

Why is public relations a useful marketing strategy?

A

Develop positive brand image and counteract any negative issues (e.g. defects, ethical criticism)

56
Q

What is publicity?

A

Free coverage by the media

57
Q

Why is publicity a useful marketing strategy?

A

Increases brand awareness without costing money

58
Q

What is word of mouth?

A

Individuals telling each other about the business and its products

59
Q

Why is word of mouth a useful marketing strategy?

A

It is free and people trust the message when they hear it from someone they know

60
Q

What is an opinion leader?

A

A well-known expert or celebrity endorsing a product (e.g. a dentist recommending a particular toothpaste, a YouTuber recommending particular makeup, an athlete in an advert for sports shoes)

61
Q

Why are opinion leaders a useful marketing strategy?

A

People trust and want to emulate the people they respect

62
Q

Which promotion strategies cost money?

A

All of them except publicity and word of mouth

(so advertising, sales promotion, personal selling, relationship marketing, public relations, opinion leaders)

63
Q

Which promotion strategies does the business not have control over?

A

Publicity and word of mouth
(and to some extent, opinion leaders too)

64
Q

What is the case study for advertising?

A

Any of the examples we looked at: Wrigleys, Dove, Coke, Amazon

Tesla do NOT advertise because they think it is inefficient

65
Q

What is the case study for sales promotion?

A

Uber - discounts for first trip/order

66
Q

What is the case study for personal selling?

A

Tesla - only sell directly so they have quality sales staff

67
Q

What is the case study for relationship marketing?

A

Uber - Uber VIP so that loyal riders get the best-rated drivers

68
Q

What is the case study for public relations?

A

H&M - hosted World Recycling Week; produced and donated protective equipment during the pandemic

69
Q

What is the case study for word of mouth?

A

Uber - offer referral codes so that users get discounts when they refer their friends

70
Q

What is the case study for opinion leaders?

A

Wrigleys - Chris Brown and his domestic violence case

71
Q

What is place as a marketing strategy?

A

The way the product is distributed to customers

72
Q

What are the distribution channels?

A

Direct (producer to consumer)

Indirect (producer to retailer to consumer; producer to wholesaler to retailer to consumer)

73
Q

What is a retailer?

A

A shop that re-sells a product to consumers (e.g. Woolworths)

74
Q

What is a wholesaler?

A

A business that buys in bulk from producers and then sells to shops (e.g. a business buys thousands of bottles of Coke and then re-sells them to convenience stores around Sydney)

75
Q

What are the benefits of a direct distribution channel?

A
  • Producer receives the full price (no cut taken by distributors)
  • Producer has control over customer service and positioning
76
Q

What are the benefits of an indirect distribution channel?

A
  • Reduces logistical costs
  • Widens availability to customers
  • The producer can focus fully on the product rather than distribution
77
Q

What is channel choice?

A

How widely available the product is

78
Q

What are the channel choices?

A
  • Intensive
  • Selective
  • Exclusive
79
Q

What is an intensive channel choice?(include an example)

A

The product is sold widely in all outlets (e.g. Mount Franklin, Lynx)

80
Q

What is a selective channel choice?(include an example)

A

The product is sold in some specific outlets (e.g. Nike shoes, fridges)

81
Q

What is an exclusive channel choice? (include an example)

A

The product is sold in very few outlets (e.g. Louis Vuitton, Tesla)

82
Q

What are 3 benefits of an exclusive channel choice?

A
  • Prestigious
  • Low distribution costs
  • Do not need to produce in high volume
83
Q

What are 3 benefits of an intensive distribution channel?

A
  • Widely available to customers
  • Increase brand awareness
  • Present in shops if other brands sell-out
84
Q

What is the case study for place strategies in marketing?

A

Tesla - only use direct distribution; also have online stores to customise cars

85
Q

What is the case study for publicity?

A

Tesla - do not advertise; instead use high-profile stunts and viral social media content

86
Q

Why would a business use a selective channel choice?

A

It balances the costs and benefits of intensive and exclusive, i.e. it widens availability without costing too much or requiring large amounts of production or cheapening the brand too much

HSC Business Studies (22 decks)

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