Section 4 - Marketing

Question 1

Market

Answer 1

A set of arrangements which allows buyers and sellers to communicate and trade in goods and services.

Question 2

Market share

Answer 2

The proportion of sales in a total market that a business or product enjoys.

Question 3

Marketing

Answer 3

Identifying customer needs and satisfying them profitably.

Question 4

Marketing mix

Answer 4

The key elements in a firm’s marketing strategy, commonly known as the 4P’s (Product, Price, Promotion and Place.)

Question 5

Market orientation

Answer 5

Where a business focuses on the needs of consumers when developing products.

Question 6

Marketing strategies

Answer 6

A set of plans designed to achieve marketing objectives.

Question 7

Product orientation

Answer 7

Where a business focuses on the design and manufacture of the product itself rather than the needs of customers.

Question 8

Market segment

Answer 8

Part of a whole market where a particular customer group has similar characteristics.

Question 9

Socio-economic groups

Answer 9

Division of people according to social class based on employment status.

Question 10

Marketing mix

Answer 10

The elements of a firm’s marketing that is designed to meet the needs of customers. Often called the 4P’s that include product, price, promotion and place.

Question 11

Competition-based pricing

Answer 11

Pricing strategies based on the prices charged by rivals.

Question 12

Cost-plus or cost-based pricing

Answer 12

Adding a percentage (the mark-up) to the costs of producing a product to get the price.

Question 13

Destroyer or predatory pricing

Answer 13

Setting a low price until rivals have gone out of business.

Question 14

Loss leader

Answer 14

A product sold below cost to draw in customers.

Question 15

Market-orientated pricing

Answer 15

Pricing strategies based upon the conditions in the market.

Question 16

Mark-up

Answer 16

The percentage added to costs which makes a profit for a business when setting the price.

Question 17

Penetration pricing

Answer 17

Setting a low price to start with in order to get established in the market. Price may be raised once established.

Question 18

Price elasticity of demand

Answer 18

Measures the responsiveness of demand to a change in price.

Question 19

Price elastic demand

Answer 19

Where a price change will result in a significant change in demand.

Question 20

Price inelastic demand

Answer 20

Where a price change will result in a much smaller change in demand.

Question 21

Skimming or creaming

Answer 21

Setting a high price initially and then lowering it later.

Question 22

Above-the-line promotion

Answer 22

Placing adverts using the media.

Question 23

Advertising

Answer 23

Communication between a business and its customers where messages are placed in the media to encourage the purchase of products.

Question 24

Below-the-line promotion

Answer 24

Any promotion that does not involve using the media.

Question 25

Sponsorship

Answer 25

Making a financial contribution to an event in return for publicity.

Question 26

Agent or broker

Answer 26

An intermediary that brings together buyers and sellers.

Question 27

Direct selling

Answer 27

Where businesses sell their products directly to consumers.

Question 28

Distribution channel

Answer 28

The route taken by a product from the producer to the consumer.

Question 29

Retailer

Answer 29

A business which buys goods from manufacturers and wholesalers and sells them in small quantities to consumers.

Question 30

Wholesaler

Answer 30

A business which buys goods from manufacturers and sells them in small quantities to retailers.

Question 31

Boston Matrix

Answer 31

A 2 x 2 matrix which describes products according to the market share they enjoy and whether the market has any potential for growth.

Question 32

Brand names

Answer 32

The name of a product which consumers see as being different from those of rivals.

Question 33

Extension strategies

Answer 33

Methods used to prolong the life of a product. * Find new markets for the product * Modifying the product * Develop the product range * Change the appearance of packaging

Question 34

Product life cycle

Answer 34

The level of sales at the different stages through which a product passes over time.

Question 35

Consumer panels

Answer 35

Groups of customers are asked for feedback about products over a set period.

Question 36

Market research

Answer 36

The collection, presentation and analysis of information relating to the marketing and consumption of goods and services.

Question 37

Primary or field research

Answer 37

The gathering of ‘new’ information which does not already exist.

Question 38

Sample

Answer 38

A small group of people which must represent a proportion of a total market when carrying out market research.

Question 39

Secondary or desk research

Answer 39

The collection of data that is already in existence.