product- marketing Flashcards
defintion of marketing/ explanation
marketing is process involved in identifying, anticipating and satisfying consumer requirments profitably
activities involved in marketing
market research
setting marketing goals
developing marketing strategy based on marketing goals
analaysing market activity, conditions and new opportunities
market orientation defintion
market oreintation is when a business bases its products on what consumers want and need ignoring its internal strengths
market orientation strengths
- competitive advantage, customers become brand loyal as there needs and wants are being met quickly
-low risk as following trends of what consumers want
-flexible to changing states and fashions prevents falling behind, keep in the eyes of consumer
- depends on efffectivnes of market research must be very aware of current marker
market orientation weaknesses
- large costs of market research business enviro moves extremely quickly to keep up to date with new trends requires intensive market research and this could cause the business to focus too much on the short term not long term growth , innovation and profitability
-sacraficing quality as quickly producing new products with a short product life cycle, no time to develop and focus on core strengths and develop existing products as product portfolio is constantly changing and quality may suffer
-likely to be immense competition as other businesses likely to also try to copy market trends and do so relatively easily
-highee price as cant benefit from eco scale, businesses that are poroduct led and specialise in that product likely to be able to produce much lower price
- hard to forecast future when constantly changing operations, marketing, strategy etc
product orientation what is it
this is when the business focuses on their own internal strengths and ignore the needs and wants of customers e.g. Mac Donalds
product orientation advantges
able to focus on long term as not constantly changing products able to develop existing core products develop them and innovate e.g. improvingg technology and improving production to make them better in the long run instead of having to constantly create new
can develop strategies for business e.g. making global
this means can focus more on quality
can also benefit from economies of scale =, loweering costs giveng a competitive advantage
good understanding of product which can improve performance
increased motivation across worfeoce making product best as possible
product orientation weaknesses
higher risk, risk that customers won’t be interested in product as it is not tailored to trends
could loose competitive edge if has nothing to do with what customers want
high R+D costs to innovate and improve- of this is not matched by profitability not good
asset led marketing what is it
when both the internal strengths of the business and the needs and wants of the customer are considered into product portfolio
for example Tesco uses their internal strength of technology to meet consumer demand e.g. culbcard recognises buying patterns and provides promotions based on similar products that customers may want
question themselves, how can we use our assets, labour and brand to meet customer needs
asset led marketing advantages
- both a short term and long term focus
- most successful technique as avoids any risks that product and market marketing have
- lower spending on r and d and market research
- strong brand loyalty, good quality and needs met
asset led marketing disadvantages
may struggle if market is already saturated
product portfolio what is it
the product range a business has to offer customers ( mix of products the business sells and produces
what are the benefits of having a larger product portfolio
- increased brand recognition
- increased economies of scale
-increased sales and profits
-target a greater range of markets and consumers - decreasing risk- risk bearing
- opportunities for further growth if ones product life cycle ends
what is the difference between breath and depth
number product lines= breath
depth- number product varieties within each product line
wha is branding
brands are extremely important
if a business an create a brand they can establish long term profitability
a brand suggests, benefits, value, personality, represents attributes
businesses want their product to seem different, more desired/ needed compared to similar products- separate identity
advantages of branding
customer loyalty likely to be high, repeat repurchases
separates business from herd especially in saturated market e.g. Starbucks and costa in coffee market- people know they can trust it rely on it know they like it
can make demand inelastic meaning they can have greater control over pricing Strats in whole market
customers pick it out of use as recognise- brand identity- repeat purchases
disavnatges of branding
- require intensive marketing costs to ensure kept in customers eye, remind customers, keep brand identity
- if one product looses interest whole product range could, need to be constantly updating products- asset led- keep some core
- high competition see high profits and success- try to copy, no need for r+d
- high costs to establish brand, marketing, quality
what us USP
unique selling product, a difference in oe business product that differentiiates it from another, reasonsn as to why cistomers prick that product over another t
e.g. tech advantage, design
what is product differentiation
e.g. promotion
packaging
form
add ons- kia 7 year warantee- more attractive
quality
- having this creates loyalty and more control over pricing
what are the 6 sages of the product life cycle
- R and. D
- introduction
- growth
- maturity
- saturation
- decline
explain each of the stages
- R and D, decelopent of the product, not yet released into the market, high costs, not making any profit
-introduction, still not making any profits, low sales, paying back development costs and likely to start developing advertisement campaigns- high cost, price likely to be high, sales are restricted to early adopters- thoes with new tech, fashion etc first
-growth, fastest sales growth throughout whole life cycle, likely to begin making profit, lots of advertising to expose to new customers Develop brand image , products widely known and consumed, prices may slowly fall
-maturity, making high profits and have developed a stable place within market, customer loyalty, high sales, may begin to extend product range as competition will increase, keep advertising high to keep brand in consumers mind speerate product from others
-saturation, when sales begin to fall slightly, prehaps product is not trending as well, low sales, very few customers gained ,aim to reduce costs to decrease prices and attract customers, market saturated, battle to servive
decline- sales fall fast, should reduce product range and concentrate on core product and limit advertising costs- may choose to discontinue as using up management time
explain and give examples of extension strategies
businesses aim to stay in the maturity or even growth part of the product life cycle therefore to avoid falling into saturation need to differentiate product and keep its newness and customers coming back, max profits and return on investment
e.g.
new packaging
new feature/ add on
relaunch in market e.g. in.a diff segment e.g. luxury
new pricing strategy- new target market
reposition product in market- e.g. new website, logo, lifestyle, demographics, distribution channels, brand message, advertising
explain factors effecting the product life cycle
- competition
- economic factors
- trends/ fashions
- strengths/ weaknesses
- amount of marketing
- customer feedback
- customer preference
- tech advancements
advantages and disadvantages of the product life cycle
advantages-
- enables businesses to ensure they always have a product at each stage of the life cycle
- allocate resources to products at different points e.g. growth - advertising is important, increasing production, capacity, although during decline , must focus on cost cutting
- understand where they are so they can develop appropriate strategies and objectives e.g. in growth, product development , focus on building brand image, customer loyalty, new customers, maturity, retaining customers, promotions, saturation cutting costs
improves competitive advantage- understand where product is helps business stay ahead of competitors innovating and differentiating
helps with forecastigng demand changes plan for new product launches, improvements to sustain growth
disadvantages:
difficult predicting wha stage in as a decline in sales may only betemporry prehaps due to inflation. but may suddenly increase this can lead to businesses witdrawing or stop investing ,issuing opportunities for repositioning
harf to forecast because external factors such as changes in trends, cosnumer behaviour can lead to unexpected changes, not all products follow a predictable pattern
some product may skip stages or stay in a stage for a long time e.g. Coca Cola- maturity
cant rely solely on this need to do market research, competitor analysis etc to be effective
