Term 3 Flashcards
What are the four P’s?
Product
Price
Place
Promotion
What is market research?
It is the systematic gathering, recording, and analysing of data about an organisations products or service, and its target market.
what is the need for market research?
-anticipate changes in the market
-identify changes in customer tastes
-identify who is buying the product
-identify new opportunities for products
-keep ahead of competitors
-ensure product is at the correct price
what does the product element of the marketing mix involve?
-new product development
-packaging
-branding
-product life cycle
what else are firms referring to when they say product?
a service that they are offering
what is the order of the product life cycle?
development -> introduction -> growth -> maturity -> saturation -> decline
what happens during the development stage?
the company research the product and create prototypes, no profit is generated
what happens during the introduction stage?
the product is officially released, no profit is made as the business is still paying of its debts from the development stage
what happens during the growth stage?
the product makes it steepest incline in sales and profits
what happens during the maturity stage?
the increase in sales and profit continues to rise but at a steadier pace
what happens at the saturation stage?
the product reaches is highest point in sales and profits
what happens in the decline stage?
the product sales begin to decline, generating less profit for the business
What is the product life cycle?
the amount of time a product goes from being introduced into the market until it’s taken off the shelves
What does the pricing section of the marketing mix involve?
-location
-age target
-brand popularity/reputation
-quality of product
-government legislation on maximum and minimum pricing
Why is product development important for a business?
Because it allows the business to get possible consumers opinions on the product before its official release, and it gives the company a clear guide to follow when creating the product
What are the benefits of a business having a good brand image?
-the logo will get instant recognition from consumers,
-it makes it easier for the buyer to decide whether they will purchase the product or not
-ensures a stable level of demand,
What are the possible drawbacks of developing a brand name?
-imitators are very difficult to stop,
-a single bad event, with bad publicity, can affect the whole range of same brand products,
-promotion costs will be high,
what are some examples of into the pipeline promotion?
-point of sale material,
-sale or return,
-staff training,
-dealer loaders,
what are some examples of out of the pipeline promotion?
-free samples,
-loyalty schemes,
-vouchers,
-special offers,
what is ‘sale or return’?
when the distributor will take back any unsold stock, this reduces the risk to the retailer and entices them to stock more,
why is staff training important?
so that the retailer feels confident dealing with customers
what are ‘dealer loaders’?
they are offers given to retailers to entice them to bulk buy, e.g. if they buy a certain amount of stock they will get a free case which they can either keep for themselves or sell
what is into the pipeline promotion?
it is when manufacturers need to promote their products to retailers to encourage them to stock their products
what is out of the pipeline promotion?
promotions aimed at customers
what do free samples do?
allow the customer to try the product before committing to a larger purchase
what are loyalty schemes used for?
to entice return customers, where customers can work towards receiving something free
what are vouchers used for?
to entice customers to return
what are some examples of special offers?
BOGOF or short term reductions in price
what does BOGOF stand for?
buy one. get one free
what are the three main aims of promotion?
-persuading = to purchase products,
-informing = telling consumers about the product,
-reminding = that the product still exists,
what is direct selling?
where the manufacturer delivers the product straight to the consumer
what is wholesaler function?
when the manufacturers deliver to the wholesaler and a shop or store buys from the wholesaler and the consumer buys from the shop,
what is retailer function?
when the manufacturer sells the product to the retailer and then the consumer buys from the retailer
what are the two main types of promotion?
above the line, and below the line
what is above the line promotion?
TV and newspapers to reach mass audience
what is below the line promotion?
promotion which is directly controlled by the business
what is the rate of consumption?
how many units of a product a business uses each day
what is lead time?
the amount of time between ordering something and receiving it
what is buffer stock?
it is the stock which you have incase your order of stock comes in late or you have forgot to order it
What is limited liability?
When you only stand to lose the value of your own shares if the firm shuts
What is unlimited liability?
It is when you are responsible for all debts
Who owns controls and finances a sole trader?
Owned-sole trader
Controlled-sole trader
Financed-owners savings
Who owns controls and finances a partnership?
Owned-2 or more partners
Controlled-partners in charge of an area
Financed-partner’s capital
who owns controls and finances a private limited company?
owned-shareholders
controlled-board of directors
financed-partners capital
who owns controls and finances a public company?
owned-government
controlled-head teacher/chief constable
financed-public purse (taxes)
who owns controls and finances a charity?
owned-board of trustees
controlled-the manager of a shop
financed-donations
how do you achieve good customer service?
-train staff
-use customer surveys
-make sure you have up to date IT
why would a business want good customer service?
-increase in sales
-customer loyalty
-competitive edge
how would you measure customer service?
-check against targets
-measure the incline in customer loyalty
-measure the decline in customer complaints
