The Marketing Mix: Product (Chapter 12). Flashcards
What is the marketing mix?
The marketing mic is a term that is used to describe all the activities which go into the marketing of a product or service. These activities are often summarised as the four P’s - product, price, place, and promotion.
What are the four p’s of the marketing mix?
- Product.
- Price.
- Place.
- Promotion.
What is the product?
This applies to the good or service itself - its design, features and quality.
What is the price?
The price at which the product is sold to the customer is a key part of the marketing mix.
What is the place?
This refers to the channels of distribution that are selected.
What is the promotion?
This is how the product is advertised and promoted.
Why is the product itself the most important in the marketing mix?
The product itself is probably the most important element in the marketing mix - without a product that meets customer needs, the rest of the marketing mix is unlikely to be able to achieve marketing success.
What will a business do after deciding on the product and appropriate market segment?
After deciding on the product and the appropriate market segment, the other parts of the marketing mix - price, place and promotion - will be determined.
What are the 4 types of product?
- Consumer goods.
- Consumer services.
- Producer goods.
- Producer services.
What are consumer goods?
Goods which are bought by consumers for their own use.
What are consumer services?
There are services that are bought by consumers for their own use.
What are producer goods?
These are goods that are produced for either businesses to use.
What are producer services?
These are services that are produced to help other businesses.
Producing the right product at the right price is an important part of the marketing mix.
- The product needs to satisfy consumer wants and needs and stimulate new wants.
- The product needs to be of the right quality.
- Not too expensive to produce.
- Design - performance, reliability and consistent quality.
- Has something very distinctive that makes it appear different.
What are the six steps to product development?
- Generate ideas (customer suggestions, employees, research and development department, sales department and competitors’ products.
- Select the best ideas for further research.
- Decide if the company will be able to sell enough for the product to be a success.
- Develop a prototype.
- Launch the product in one area to test
the market. - Fully launch the product.
What are the benefits for the business when developing new products?
- Unique selling point means the business will be first in the market.
- Diversification for the business.
- Allows the business to expand into new markets.
- May allow the business to expand into existing markets.
What are the costs for the business when developing new products?
- Carrying out market research.
- Producing trail products.
- Lack of sales if the target market is wrong.
- Loss of company image if new product fails.
Define brand name.
The brand name is the unique name of a product that distinguishes it from other brands.
Define brand loyalty.
Brand loyalty is when consumers keep buying the same brand again and again instead of choosing a competitor’s brand.
Define brand image.
Brand image is an image or identity given to a product that gives it a personality of its own and distinguishes it from its competitors’ brands.
Why do consumers prefer branded products?
Branded products are normally sold as being of higher quality and this gives assurance of a standard quality that makes consumers confident in buying it.
What are eight key points of branding?
- Unique packaging.
- Unique name.
- Higher quality than unbranded products.
- Assured quality.
- Encourages brand loyalty to customers.
- Creates a brand image.
- Needs advertising to reinforce.
- Higher prices than unbranded products.
Define packaging.
Packaging is the physical container or wrapping for a product. It is also used for promotion and selling appeal.
What 7 things should packaging be?
- Eye-catching.
- Promotes the brand image.
- Carries information about the product.
- Easy to open the container and use the product.
- Easy to transport the product.
- Protects the product.
- Suitable for the product to fit in.
Define product life cycle.
The product life cycle describes the stages a product will pass through from its introduction to its decline.
What are the stages of the product life cycle?
- A product is DEVELOPED and no sales at this time.
- The product is INTRODUCED and sales grow slowly because consumers don’t know of the product.
- Sales start to GROW rapidly and profits start to be made as costs are covered.
- MATURITY as sales now increase slowly.
- Sales reach SATURATION and stabilize at their highest point.
- Sales of the product DECLINE as new products come along.
What is the product life cycle affected by? Give an example of this.
It is affected by the type of product e.g fashionable items will go out of fashion quickly whereas food products will not.
How may a business extend the product life cycle?
If extension strategies are effective, the maturity phase of the product life cycle will be prolonged.
- Introduce new variations of the original product e.g. children’s version.
- Sell into new markets e.g. export outside the country.
- Make small changes to the product’s design, color, or packaging.
- Use a new advertising campaign.
- Introduce a new or improved version of the old product.
- Sell through addition or different retail outlets.
What might a business do to counteract declining products?
A business will need to have products coming up into the growth phase to counteract those that are in decline.
How will stages of the product life cycle influence pricing decisions?
- A branded product is likely to be sold at a high price.
- Prices are likely to be higher than competitors in the growth phase.
- In saturation or maturity stage a business will likely lower prices as competitors would have released new products.
- Some substantial price discounts might be offered during the decline stage.
How will stages of the product life cycle influence promotional decisions?
- Spending on promotion will be higher at the introduction stage.
- Advertising would probably be reduced in later stages.
- Promotion spending might be increased again if the business decides to adopt an extension strategy.
Define extension strategy.
An extension strategy is a way of keeping a product at the maturity stage of the life cycle and extending the cycle.
