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A Level Business (Y12) > Topic 3: Marketing Management > Flashcards

Topic 3: Marketing Management Flashcards

1
Q

What is market segmentation?

A

Dividing a market into parts that reflect different customer needs and wants

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2
Q

Benefits of market segmentation (for small firms)

A

Offers a valuable strategy to break into a market

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3
Q

Benefits of segmentation for large companies

A
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4
Q

Methods of segmentation

A

Demographic segments
Geographic segments
Income segments
Behavioural segments

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5
Q

examples of behavioural segmentation

A
  • by occasion
  • usage
  • loyalty
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6
Q

what is the process of segmentation

A
  • conduct research into different types of customers
  • see if there is any trend or correlation
  • identify segment you wish to focus on
  • devise a product
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7
Q

What is a target market ?

A

A set of customers sharing common needs and wants that a business decides

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8
Q

Influences on choosing a target market ?

A

depends on:
mission statement and corporate objectives
size of segments and level of demand
nature of the product
nature of competition
nature of market

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9
Q

What is mass marketing?

A

when a business sells into the largest part of a market

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10
Q

What is niche marketing?

A

business targets a smaller segment where customers have specific wants and needs

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11
Q

features of mass marketing

A
  • general wants and needs
  • higher production output so potential for economies of scale
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12
Q

benefits of niche marketing

A
  • less competition due to fewer firms
  • can charge a higher price
  • loyal customers
  • profit margins tend to be higher
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13
Q

downsides of niche marketing

A
  • lack of economies of scale
  • risk of over dependence, may go out of fashion
  • can attract lots of competition of successful
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14
Q

what is market positioning/mapping

A

the range of positions that a product can take in a market based on two dimensions that are important to customers

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15
Q

advantages of market maps

A

identifies maps in the market
encourages use of market research

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16
Q

disadvantages of market mapping

A
  • a ‘gap’ doesn’t mean there is demand
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17
Q

the values of segmentation

A
  • improved sales volume
  • increased prices
  • increased diversification therefore security as you are appealing to multiple segments
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18
Q

what is a product?

A

anything that is capable of satisfying customer wants

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19
Q

what is brand extension?

A

business uses brand name on a new product e.g dove soap and dove shampoo

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20
Q

what is brand stretching

A

when a brand is used for a diverse range of products that aren’t connected

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21
Q

what is the boston matrix

A

a model that helps businesses analyze their portfolio of products

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22
Q

four categories of the boston matrix

A

stars
cash cows
question mark
dogs

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23
Q

dimensions of the boston matrix

A

market share and market growth

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24
Q

what are stars?

A
  • high share of a growing market
  • lots of competition
  • need heavy investment to sustain growth
  • will eventually become cash cows
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25
Q

what are cash cows?

A
  • high share of a low growing market
  • generates cash and profits for the business
  • profit can be invested into other products
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26
Q

what are question marks?

A
  • low market share of a fast growing market
  • have potential to provide high profit but uncertain
  • need high investment to promote them
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27
Q

what are dogs?

A
  • low market share of a declining market
  • hold little appeal
  • will be killed off once sales reach below breakeven
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28
Q

uses of the boston matrix

A
  • ## helps managers plan what to do with existing product portfolio
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29
Q

criticisms of boston matrix

A
  • only a snapshot of current position
  • market share is an inadequate measure of a products ability to generate cash
  • product life cycle will vary for each product
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30
Q

what is the product life cycle

A

a theoretical model that describes the stages that a product goes through

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31
Q

stages of plc

A
  • research and development
  • introduction
  • growth
  • maturity
  • decline
  • rejuvenation
32
Q

research and development stage of plc

A

-absorbs time and may not be successful
- can take a long time before product is introduced
- causes of elimination before launch: high costs, does not fit in firms product range

33
Q

introduction stage of plc

A
  • low level of sales
  • negative cash flow
  • needs heavy promotion
  • strategies used at this phase: skimming or penetration pricing
34
Q

growth stage of plc

A
  • fast growing sales
  • rise in capacity utilization
  • positive cash flow
  • costs fall with economies of scale
  • strategies used in this phase: advertisng, continuing high promotional spending
35
Q

maturity stage of plc

A
  • slower sales
  • high capacity utilisation
  • prices and profits will fall
  • strategies used at this phase: enter new segments ,need to defend position
36
Q

decline stage of plc

A
  • falling sales
  • decline in profits
  • strategies: maintain market share, price cutting, reduce prices, reposition product
37
Q

extending plc

A
  • change price
  • change promotion
  • change product
38
Q

Layers that add value to product

A

Design
Brand Name
Quality
Features
Packaging
After-sale service

39
Q

What is brand extension

A

When a business uses a brand name on a new product that has some of the brands characteristics.
e.g dove soap + dove shampoo

40
Q

What is brand stretching?

A

Where a brand is used for a diverse range of products that are not necessarily connected
e.g virgin

41
Q

Functions of packaging

A

protection of contents
distribution
selling - design provides info + conveys image

42
Q

Roles of packaging

A

if product cannot be differentiated by its features then its important
help promote brand image
maintain quality standards
appeal to customers + distributors

43
Q

Star Product

A

High Share of a Growing Market
Need promotion and protection as it is a competitive market
will become cash cows

44
Q

How is the boston matrix categorised

A

Stars
Question Marks
Cash Cow
Dog

45
Q

What is the boston matrix

A

Business model that helps businesses analyse their portfolio of products based on market share + market growth

46
Q

Cash Cows

A

Market Share of a Low Growing Market
Mature + successful products
little investment needed
high profits that can be invested in newer products

47
Q

Question Marks

A

Low Market Share in Fast Growing Market
high investment needed
they have potential but uncertain

48
Q

Dogs

A

Low Market share of a declining market
hold little appeal
will be cut off if sales dip below breakeven

49
Q

Criticisms of Boston Matrix

A

no predictive value
doesn’t take environmental factors into account

50
Q

uses of plc concept

A
  • forecast behavior of future sales
  • aid analysis of product portfolio
  • assist in marketing strategies
51
Q

criticisms of plc concept

A
  • decline is not inevitable
  • difficult to identify where a product is in its life cycle
52
Q

what is promotion?

A

the ways in which a business makes its products known to the customers

53
Q

what is branding?

A

the process of developing a product with a unique character, for instance design or image, that is consistent and well recognised

54
Q

advantages of having a strong brand

A
  • inspires customer loyalty leading to repeating sales
  • brand owner can charge higher prices
  • retailers want to stock top selling brands
55
Q

what is branding: logos?

A
  • a logo is a symbol or picture that represents the business
  • easy to recognise
56
Q

different methods of promotion

A
  • advertising
  • sales promotion
  • personal selling
  • direct marketing
57
Q

benefits of advertising

A
  • wide coverage
  • control of message
  • repetition means message can be communicated effectively
58
Q

drawbacks of advertising

A
  • often expensive
  • one way communication
59
Q

drawbacks of personal selling

A
  • high cost
  • labour intensive
  • can only reach a limited number of customers
60
Q

benefits of personal selling

A
  • high customer attention
  • message is customised
  • adaptable
61
Q

benefits of sales promotion

A
  • effective at achieving a quick boost a sales
  • encourages customer to trial a product
62
Q

drawbacks of sales promotion

A
  • sales effect may only be short term
  • possible damage to brand image
63
Q

factors affecting pricing decisions

A
  • PED
  • costs
  • competitors
  • product life cycle
64
Q

what is penetration pricing

A
  • offer product at a low introductory price
  • aim is to gain market share quickly
  • price can be increased once target market is reached
65
Q

what is price skimming

A
  • high price to maximise product
  • quick recovery of development costs
  • mostly used in introduction stage
66
Q

what is place ?

A

how a business gets its products to the customer

67
Q

what is a distribution channel?

A

a distribution channel moves a product from production to consumption

68
Q

what are intermediaries

A

organisations through which a product must pass between its point of production and consumption

69
Q

what are short channels used for?

A
  • expensive goods
  • customised products
  • services
  • bulking products
70
Q

what are long channels used for

A
  • consumer goods
  • small products
  • simple goods
71
Q

what is multi-channel distribution

A

involves a business using more than one type of distribution channel

72
Q

benefits of multi-channel distribution

A
  • allows more target market segments to be reached
  • customers increasingly expect products to be available via more than one channel
73
Q

drawbacks of multi-channel distribution

A

complex to manage
pricing strategy becomes confusing

74
Q

people element of the marketing mix ?

A

refers to employees of a business who interact with customers or customer service

75
Q

process element of marketing mix?

A

refers to procedures involved in a transaction

76
Q

the physical environment element

A

the aesthetics of the shop or website

A Level Business (Y12) (7 decks)

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