THEME 2- Marketing Mixture. Flashcards
How is colour important in branding?(2)
-Helps increase brand recognition and increases pos feeling in customers. Certain colours can be associated with the brand.
Define branding and give 6 examples of branding
Branding creates an identity that customers see as different from other products.
Forms of branding:
1) The product’s shape and size.
2) Colour.
3) Tagline.
4) Packaging.
5) Theme- memorable tune.
6) Celebrity endorsement.
What can extensive promotion aid with? What’s the drawback?
Extensive promotion could help increase competition as awareness increases for the brand, therefore, more customers will be inclined to buy it.
The drawback could be the heavy expense businesses will have to pay and if promotion doesn’t work, money is lost and can result in higher costs but lower profit.
Give 5 methods of promotions?
Give 5 methods of promotions?
1) Advertisting.
2) Promotion.
3) branding.
4) Sponsorship.
5) Product trials.
Explain one benefit of a business using a product trial?(3)
Product trial helps raise awareness and promote brand- effective as free sample will help customer validate their purchase and feel more comfortable. For eg Mr Pretzel.
How to structure a 9 marker?
a 6 marker?
a 9 marker-
Give + and however of the chosen options then give with a conclusion to justify which option depending on long-term effect.
a 6 marker:
Give a positive and however and conclusion by linking long term effects.
What is the design mix?
1) Aesthetic- how it looks, feel, appearance.
2) function- serves the purpose, durability.
3) cost- the lower the cost to produce a product, the better it’ll give a competitive environment, cost of production determines cost of product
What is a ‘brand’?
A ‘brand’ is a named product which consumers percieve as being different from competing companies
What is the definition of promotion?
Define advertising, promotion and sponsorship?
To raise awareness or desire for product.
1) Advertising- businesses pay to put out an advertising in order to communicate a message to customers- may include colour, humour, emotive language.
2) Sales promotion- 50% off, 60% off- encourages customers to buy now than later.
3) Sponsorship- businesses can gain publicity by financially supporting an event or business.
What factors influence price? List 3
Customers- lowering price increases customer demand.
- Competitions- takes into account price charged by rival business.
- Costs- cover the costs of business to ensure profit.
What is cost-plus pricing?
What is Price discrimination?
1) Cost plus pricing-a price set, to cover cover the cost of labour and production
3) Price discrimination- charging different prices to different customer groups for the same ite
What is predatory pricing?
What is psychological pricing?
the pricing of goods or services at such a low level that other suppliers cannot compete and are forced to leave the market. This is usually done by large businesses and drives out competition.
-illegal.
What is psychological pricing?
-The aim of psychological pricing is to make the customer believe the product is cheaper than it really is. Pricing in this way is intended to attract customers who are looking for “value”. (£9.99 instead of £10)
What is loss-leader?
2)Loss leaders- products is sold at a lower than cost price to attract customers and this is usually used as a method of sales promotion to encourage customers to make purchase of profitable goods in store.
How is Price Penetration a pricing strategy for new products?
Price Penetration: set at a low price to begin with to attract customer and build loyal customers and obtain a high market share.
-Short term good but for long term- have low profit but have higher market share.
Penetration pricing is often used to support the launch of a new product, and works best when a product enters a market with relatively little product differentiation and where demand is price elastic - so a lower price than rival products is a competitive weapon.
How is Price Skimming a pricing strategy for new products?(3)
How is Price skimming a pricing strategy for new products?
- Price is set high at launch to maximise profit-> usually for new products that face little to no competition due to technological advantages.
- products bought by ‘early adopters’ who are prepared to pay a higher price to have the latest edition.
- Apple.
- Price skimming cannot last for long as rivals release new products which puts pressure on the price( competitiors with Apple)
How do businesses determine to prices? List 3-4 reasons
Why is setting prices important?
According to: profit desired, demand anticipated, competition expected, target market, quality and influence of brand and technology.
Why is setting prices important?
-Helps establish quality of product.
What are some extension strategy examples?
business leads to the group developing a similar and improved one which consumers buy and sales all for the out dated one.
What is the high volume low price strategy?
What is the high volume low price strategy?
Producing a lot of the products at a low cost so buying in builk is cheaper- costs are low.
-low production costs= low prices.
-low profit but still succesful as large quantities are sold,
What is high margic and low volume strategy?
What is high margic and low volume strategy?
- High price.
- Difference between costs to make the product and the price charged.
- Used for premium products.
- Low volume,
- Exclusive products and high quality.
What is a product life cycle
Describe the 5 stages of the product’s life cycle and define each stage.
Describes the stages of a product life( showing products sales over time) and how it lasts in the market.
Describe the 5 stages of the product’s life cycle and define each stage.
1)Introduction- product launches- high levels of promotion-> create awareness. Sales are initially low
2) Growth- sales will be increasing as it starts to become well known.
3) Maturity- Sales reach highest, competition increases and rivals bring out new and better products. The MM and/or target market of product is changed in an attempt to increase its life in the market.
4) Decline- Sales fall significantly- profit- as consumer switch to competitions’ products that are new improved, up to date.
(4)- Extension strategy- increase advertising or campaight or reduce price of product in order to increase its life in the market.
5- Withdrawal of product.- removed from market.
How is MR different to Research & Development?
Market research is where you research competitors and customers to decide on market mix whereas R&D is scientific research to make prototypes of final product to test how it works and improve final product(Dyson)
What are the benefits of the design mix?(4)
- Helps add value for quality- builds customer trust and loyalty.
- helps business prioritise what factor they want to solely focus on and spend the most money on.
- customer needs into consideration-changes in what consumer wants
- make successful product.
List some (4) advantages of a strong brand and (2)disadv?
Adv:
- Greater consumer awareness,
- able to charge premium prices.
- more shops would stock.
- increase sales and profit due to good rep
Disadv:
- product could have negative publicty
- higher costs to promote brand in first place
Why is it important for a business to develop a strong brand?
-Brands can be easily recognised and customers would be familar with brands which means there would be less hesitance when purchasing.
