topic 3- marketing Flashcards
1
Q
what is marketing ?
A
2
Q
what are the marketing objectives ?
A
sales volume and value
market size
market and sales growth
market share
brand loyalty
3
Q
what are marketing objectives ?
A
targets that a company marketing department set itself
valuable in helping the company to achieve its overall objectives
4
Q
what is sales volume ?
A
amount of sales expressed as a number as a number of units sold
sold over a certain period of time
- easy to visualise but it doesn’t tell you anything about the amount of money coming in from sales
5
Q
what are sales value ?
A
amount of sales expressed as the total sum of money spent by consumers
- used when business sell a lot of differently priced items usually base objectives on salves value instead of volume
6
Q
what is sales growth or market growth ?
A
business might aim for a growth in SALES or the MARKET
in VOLUME
or in VALUE
7
Q
what is market share ?
A
is the proportion of total market sales that a firm has
- commonly want to increase there market share
8
Q
how do u increase market share ?
A
- entice customers away from competitors
- attract brand new customers in a brand new market
9
Q
why is market share useful ?
A
tells a business how well it is doing compared to its competitors
10
Q
how can market share be calculated ?
A
business sales / market share x 100
11
Q
what is market size ?
A
total size of …
the market
sales value
sales volume
- is increasing them growing in the market
12
Q
how do you calculate market size ?
A
number units sold x price
13
Q
how do u calculate market growth or sales growth ?
A
chnage in size of market or sales/ original size x 100
14
Q
what is a good example of brand loyalty ?
A
social media
as allows customers and business to interact
15
Q
why is brand loyalty important ?
A
- keeping customers is easier than finding new ones
- measured in terms of how many customers return
- bean’s and r an intangible asset and can be sold
16
Q
what is brand loyalty ?
A
the tendency of some consumers to continue buying the same brand of goods rather than competing brands.
17
Q
what are the 3 things that influence marketing objectives ?
A
- internal factors
- external factors
- laa
18
Q
what are the internal factors that influence marketing factors ?
A
-corporate objectives
-finance
-human resources
19
Q
what are the external factors that influence marketing objectives ?
A
-market
- technology
- competitors
- ethics and environmental factors
20
Q
what are corporate objectives factors ?
A
objectives need to be aligned with the company’s overall goal
21
Q
what are finance factors ?
A
is allocated a marketing budget
- affects what the marketing department are able to do
- if cut then objectives need to be scaled down
22
Q
what arehuman resources factors ?
A
identifies how many staff the company needs
- if reduced or increased they will need to adjust there objectives for what is achievable for staff levels
23
Q
what are market factors ?
A
state of economy has a big impact
24
Q
what to do if an economic boom ?
A
economic boom is a good time to try increase sales volume as income levels have risen
25
what to do if economic recession ?
more likely to have objectives of maintaining market share
26
what are technology factors ?
if tech changes rapidly in that market then objectives tend to be on sales and price as new tech causes prises to fall and rise fast
27
what are competitors factors ?
actions of competitors affect marketing objectives especially in a high competitive market
28
what are the ethics and environmental factors ?
awareness is increasing for consumers
if behave in a harmful way can damage brand image
so need to be ethical and environmental conscious
29
how does the law directly affect market objectives ?
as government regulations have direct impact
eg)
-predatory pricing
- trade descriptions act
- advertisement of some product
30
what is predatory pricing ?
cutting prices to force competitors out of business
is illegal in EU and US
31
what is the trade description act ?
regulates promotion
cant lie about products
32
what can't u advertise ?
tobacco
alcoholic drinks
prescription medicines
33
what is the importance of market research ?
- reduce risk of making marketing decisions
- analyse the existing positions of the business
- decide on possible marketing objectives or actions
- asses the effectiveness of marketing decisions
34
what is market research ?
the collection and analyse of data and information to inform a business about it market
35
what is primary research ?
field research
involves the collection to be first hand data and it didn't exist before
36
what is secondary research ?
desk research
research that already been undertaken by another organisation and therefore already exists
37
what are the different types of primary research ?
- focus groups
- surveys
- reviews
- door to door
- customers feedback
- supplier feedback
- observations
- in depth interview
- telephone call
38
what are examples of secondary research ?
- textbooks
- national and local government
-newspapers
- professional bodies
- trade unions
- academic organizations
- magazines
- international bodies
39
what is qualitative research ?
the gatherings of non-statistical data that gives a company an in depth insight into the reasons for human behaviours
40
what is quantitive research ?
the gathering of statistical data to inform the company about peoples behaviour but doesn't identify the reasons
41
why is sampling carried out for primary research ?
- cant interview everyone so have to split it into similar groups
- need a sample that represents there whole market
- too expensive to ask everyone
42
what will affect how big the sample is ?
- accuracy
- how big the population you picking from it ( size of target )
-budget
- degree of confidence in the results
43
what size of the sample have a better time of being representative ?
a big sample
but also still wont be 100% accurate as margin errors
44
what will affect the value of the sample ?
- technique used
-how carried out
- size of sample
45
why is a representative sample used ?
as cant ask for the opinions of all potential consumers
46
what is a sample ?
a group of subjects that has been chosen from a larger group, the population for the sample
47
what are the 3 sampling types ?
random
quota
stratified
48
what is random sampling ?
sample is selected for the study from a population where each individual is chosen entirely by chance and has an equal chance of being selected
49
what is quota sampling ?
the population is first segmented into sub groups before a judgement is made in selecting a certain number of respondents that are representatives of that subgroup
50
what is stratified sampling ?
the population is first segmented into subgroups before respondents are randomly selected from within that subgroup
51
why not doing market research is a risk ?
as more chance of a fail as it may not be what the market wants
52
why does marketing data need to be interpreted ?
- informed decision making
- devising strategies
- understanding market
- identify sales patterns
- realistic target
- keeping up to date with market changes
- review competitors actions
- evaluation of post actions
53
what are the tools for interpretation data ?
correlation
confidence levels
extrapolation
time series
value of tech
IT
sales forecasts
54
what is correlation ?
identifying a relationship between 2 variables
55
what is positive correlation ?
the 2 variables move in the same direction
56
what is negative correlation ?
the 2 variables move in opposite directions
57
what is zero correlation ?
there is no relationship between the factors ?
58
what are the numbers of each correlation ?
strong negative- is -1
zero is 0
strong positive is +1
59
what may managers assume if there is a correlation ?
that the trend will carry on
so extrapolate graph and draw a line of best fit and keep the line going
60
what do managers need to be careful about with there assumptions for correlation ?
cautious about extrapolating too far beyond the unknown data as the trend may not continue
61
what are confidence levels ?
the probability that the research findings are accurate
62
what factors affect confidence levels ?
sampling technique
research methods
expertise of the person carrying out and analysing the research
63
what are confidence intervals ?
- a margin of error for sample results
-the possible range of outcomes for a given confidence level
-it means the range of values within which the business is confident that the research results will be true
64
when do u use confidence intervals ?
to make the estimate which has been taken from the results of the sample more useful to use
65
what do you do if u want to be confident that you interval contains the value of the population ?
can increase the interval level
so it gives you a wider confidence level
66
why can be wider confidence levels be bad ?
as it is too vague to be helpful
67
what is extrapolation ?
it uses data to extend and identify trends that will be in the future
-about predicting the future
68
when is extrapolation useful ?
when trends can clearly be identified and the market is relatively stable so it barley changes
69
how long in the future is it best to use extrapolation to predict for ?
a few months
- as customers desires and technology constantly change
70
why is extrapolation bad ?
- things can easily change
- doesn't tend to take everything into account
-past doesn't always indicate the future
71
what can 3 things can change to affect extrapolation ?
-competitors actions
- consumer tastes
- market conditions
72
why is technology used ?
to gather info about lifestyles of customers and products that they may buy
- so targeting and promoting to right people
73
why is technology valuable ?
-gather and analyse large volumes of data quickly and accurately
- track and interpret consumer spending habits
- collect consumer opinions from around the world
- encourage consumer feedback through social media review sites
- enable 2 way communication
74
what are ways technology can get customer information ?
- social media websites
-loyalty cards
-google showing relevant ads
- WIFI signals from customers phone and track there movements
75
what is sales forecast ?
allow the finance department to produce cash flow forecasts so can predict sales so predict how much gonna come in and how much gonna spend
-also allow production and HR to prepare for expected levels of sales so can have right amount of machinery and stock and staff
- it helps other departments
76
what does time series analysis look at ?
data over time
- used to reveal underlying patterns by recording and plotting data iver time
77
what can time series analysis be used for ?
look for link between sales and marketing activity
78
what are trends ?
long term movement of a variable
79
what are seasonal fluctuations ?
they repeat on a regular basis
80
what are random fluctuations ?
have no pattern to them
- also include
major disturbances
changes in government
natural disasters
sudden unpredictable events
81
what can software be used for ?
- what ifs scenarios
-point-of scale
82
what is the problem with 'Big data' ?
so much data
streams so fast
so normal computers aren't sufficient to handle it
83
why is 'big data' good ?
can draw useful correlations
so large companies investing in ways to analyse it
84
what is the downsides of software ?
- expensive especially if need to upgrade
- need to train staff- time consuming and expensive
-can lead to the business valuing quantity over quality- need to know what the trends mean
- computer systems might not be up to handle it all and can loose info and analysation
85
what is price elasticity ?
measures the responsive of demand to a change in price
- it is always a negative value
86
what is inelastic Ped ?
change in demand is less than change in price
if a Ped is between 0 and 1
87
what is elastic Ped ?
change in demand is greater than change in price
>1
it is very responsive
88
what is the formula for Ped ?
% change in quantity of demand / % change in price
89
what happens when there is a positive change in price ?
negative change in demand
90
what happens when there is a negative change in price ?
positive change in demand
91
what are the factors that affect Ped ?
- branding
- income
- nature of the good
- the availability of substitutes
- tine
92
how does branding affect Ped ?
- firms spend time and money building up their brand image
- by creating brand loyalty firms know there customers
- know they will be willing to pay more for the product and they ca raise the prices
- Ped is lower
93
how does income affect Ped ?
- if consumer income higher then the issue prices become less important to consumer
- so easier for firms to raise price as the Ped is lower
94
how does nature of the good affect Ped ?
- a luxury good will be price elastic as demand will be more sensitive to changes in price
- necessity goods will be price inelastic as demand will be less sensitive to changes in price
95
how does the availability of substitutes affect Ped ?
the closer the substitutes and the more that are available the higher the Ped
96
how does time affect Ped ?
-longer the time period the higher the Ped
-given more time other firms have the ability to produce similar products
- customers have more chance of adapting their buying habits
97
what happens to revenue when you raise the selling price ?
price elastic product = sales revenue will decrease
price inelastic product = sales revenue increase
98
what happens to revenue when you lower the selling price ?
price elastic product =
sales revenue will increase
price inelastic product =
sales revenue will decrease
99
what are the problems with forecasting Ped ?
- Ped for a product is constantly changing
-very difficult to measure
- competitors don't stand still
100
why is is it difficult to measure Ped ?
- difficult to find info
- Ped changes over different price ranges
-change over period of economic cycle
-tastes and fashion are constantly changing
101
what are competitors constantly trying to do ?
to improve existing products
bringing out new products
trying to promote their products
102
why do we want a product to be inelastic ?
so changes in price wont be as responsive
103
what is income elasticity of demand (Yed) ?
how demand changes with income
- the more income then there's more demand for some products and less demand for others
104
what is the formula for Yed ?
% change in quantity demanded / % change in income
105
what Yed does normal goods (more of a need) have ?
a positive Yed
less than 1
- means that as income rises the demand rises but at a slower rate than the increase in income
106
what Yed does luxury products have ?
positive Yed
more than 1
- means that the demand for luxury goods grows faster than the increase in income
107
what Yed do inferior goods have ?
negative Yed
- meaning demand falls when income rises
- demand rises when income falls
108
how does price elasticity help manufactures ?
helps decide wether to raise or lower the price of a product
- can see what might happen to sales
109
how does income elasticity help manufactures ?
see what happens to sales if the economy grows or shrinks
110
what is market segmentation ?
occurs when the market is split into subgroups of consumers with similar characteristics
- helps to identify different types of consumed and there different wants and needs
111
what are the 4 market segment methods ?
demographic
geographic
income
behavioural
112
what is demographic segmentation ?
identifies subgroups of the population based on their demographic profile or characteristics
- look at social and economic characteristics of individuals and households
113
what are the different profiles or characteristics of the population ?
age
gender
level of education
religion
race
family size
stages of life
114
