Unit 2 - 2.4 - The Marketing Mix Flashcards
What does the marketing mix refer to?
The 4 Ps of marketing: product, price, promotion, and place
These components are used together to market a product or service.
List the 4 Ps of marketing.
- Product
- Price
- Promotion
- Place
Each ‘P’ is examined in detail in the context of the marketing mix.
What is an important element in a number of different products?
Design
Design is particularly significant where style and technology work together.
In which contexts is design considered important?
In products where style and technology work together
Design plays a critical role in enhancing user experience and functionality.
What is innovation?
The improvement of an original idea, which often involves using new processes.
What is invention?
The introduction of a totally new product or service.
What are the four stages of the product life cycle?
Introduction, Growth, Maturity, Decline
Fill in the blank: The life of a product is usually shown as a graph divided up into four stages: introduction, growth, maturity, and _______.
Decline
True or False: The product life cycle consists of five stages.
False
What does the product life style look like ?
What can be used when the product hits the decline
Extension strategy
What is the term for when a product or service is first on sale?
Introduction stage
What is growth in the context of sales?
When sales are growing strongly as the new product or service becomes known.
What does maturity refer to in sales?
When sales are at their highest level.
What is decline in sales?
When sales are falling as the product or service is seen by customers to be old and they switch to new products or services.
What is competitor pricing?
A price set based on prices charged by competitors for a similar product.
What is cost-plus pricing?
A pricing method that adds a percentage for profit to the total costs of making a product
How is the selling price determined in cost-plus pricing?
By adding a percentage for profit to the total costs of making a product
What is penetration pricing?
A price set lower than those of competitors
Often used by new businesses to break into the market
Is penetration pricing a long-term or short-term strategy?
Short-term strategy
Why do businesses use penetration pricing?
To break into the market
Fill in the blank: Penetration pricing is often used by _______ to break into the market.
[new businesses]
True or False: Penetration pricing is typically associated with long-term pricing strategies.
False
What is promotional pricing?
Prices are reduced to give products a boost or to sell off old stock.
Promotional pricing is often used to increase sales volume or clear inventory.
What is skimming in marketing?
A pricing strategy set high for new products that are more advanced than competitors, as consumers are willing to pay higher prices for the newest technology.
Also referred to as ‘creaming’.
What are point of sale promotions?
Sales offers available when purchasing a product.
Name four types of promotions included in point of sale promotions.
- Price reductions
- Competitions
- Free samples
- Loss leaders
True or False: The business expects to make a profit from loss leaders by encouraging customers to buy other products.
True
Fill in the blank: Loss leaders are goods offered at a _______.
[low price]
What is the main goal of using loss leaders in promotions?
To tempt customers to buy other more profitable goods.
What is the expected outcome when a business uses loss leaders?
Overall the shop makes the profit it needs.
What is promotional advertising media?
The ways in which a company can advertise its goods, such as social media, websites, print media, television, and radio.
What are price reductions in the context of promotions?
Sales to sell off old stock, like old models of cars or winter clothes
Price reductions can lead to less profit or even a loss for the business.
What is a competition promotion?
A promotion where a purchase enters customers into a contest, such as finding a voucher for a free holiday
Competitions incentivize purchases by offering attractive rewards.
What are loss leaders?
Goods sold at a loss to attract customers, hoping they will buy other products at higher prices
An example is a supermarket selling petrol cheaply to draw in shoppers.
What are free samples in promotions?
Small portions of a product offered to entice customers to make a purchase
Examples include offering pieces of cheese in supermarkets.
What is the advantage of using social media for advertising?
A cheap way to communicate with and target large numbers of people
Platforms like Facebook and Twitter are commonly used, but not everyone uses social media.
What information can a business provide on its website?
Written information, diagrams, and videos depending on budget
Maintaining an up-to-date website incurs costs for businesses.
What is a disadvantage of television advertising?
It is often expensive, despite being effective for reaching a wide audience
Advertisers must know their target audience’s viewing habits.
What types of print media can businesses use for advertising?
Newspapers, magazines, and leaflets
Businesses can target their market based on the type of print media, but many people do not read newspapers.
What is a key benefit of radio advertising?
It is cheaper than TV and suitable for local advertising
However, products cannot be visually showcased in radio ads.
What is physical distribution?
The distribution of a good or service using a physical presence such as a shop or office.
What does Chanel 1 in the (4ps place )
Producer - consumer
What does Chanel 2 look like in the (4ps place )
Producer-retailer- consumer
What does Chanel 3 (4ps place ) look like
Producer - wholesaler- retailer - consumer
What is one advantage of a producer selling directly to consumers?
The producer makes more profit by missing out wholesalers and consumers.
What is an advantage of selling directly to the retailer?
The producer can benefit from keeping some of the profit that would have been made by the wholesaler by being confident the retailer will be able to market the goods to consumers
Selling directly can also strengthen relationships with retailers.
What is the role of a wholesaler in the distribution channel?
A wholesaler can break up bulk stock and offer retailers the goods in affordable quantities.
How does a wholesaler benefit retailers?
By offering goods in quantities that retailers can afford and sell, making more retailers willing to sell the goods.
Fill in the blank: A wholesaler can break up _______ stock.
[bulk]
True or False: Wholesalers only sell goods in large quantities to retailers.
False
What is digital distribution?
The distribution of goods and services digitally by downloading from a website.
What is a key advantage of digital distribution for consumers?
The consumer can buy the product 24/7.
What is a financial benefit of digital distribution?
It is a method of selling, without the costs of physical shops or transport.
What is a disadvantage of digital distribution regarding physical goods?
Physical goods cannot be distributed digitally.
Why is the digital distribution market considered very competitive?
Consumers can compare prices and products online.
Who is unable to buy online due to a disadvantage of digital distribution?
Customers who do not own a computer.
What is a concern for some customers when buying online?
Some customers do not like sharing their bank or credit card details online.
What are the components of the marketing mix?
Price, Product, Place, Promotion
Known as the 4 Ps of marketing.
What are the 4 Ps of marketing?
Product, Price, Place, Promotion
The 4 Ps represent the key components of a marketing strategy.
What should businesses consider when making decisions about the marketing mix?
Businesses must consider:
* the type of product they are selling
* the cost of the product
* the stage of the product life cycle
* the target market
* the funds available for marketing
These factors influence the effectiveness of marketing strategies.
Fill in the blank: Businesses must consider the _______ of the product when making marketing mix decisions.
[type of product]
Fill in the blank: The _______ of the product affects decisions in the marketing mix.
[cost]
True or False: The target market is not a consideration in the marketing mix.
False
The target market is crucial for tailoring marketing strategies.
What is the significance of the product life cycle in marketing decisions?
The stage of the product life cycle determines marketing strategies and resource allocation.
What does the term ‘target market’ refer to?
The specific group of consumers at which a product or service is aimed.
Fill in the blank: The funds available for _______ are a consideration for businesses in the marketing mix.
[marketing]
Example of the marketing mix in a mobile phone
What is market data?
Information that can help marketing decisions, including data on market share, changes in demand, and the effect of promotions.
Define market share.
The percentage of total sales of a product that a business has made.
How is market share calculated?
Market share = (Sales of business ÷ Total market sales) × 100
What is the market share if a business sells 20,000 products in a market of 50,000?
40%
Calculation: (20,000 ÷ 50,000) × 100 = 40%
What is a target market?
A group of consumers to whom the business tries to sell its products.
What factors can define a target market?
Factors such as gender, age, and lifestyle.
How does the target market influence a business?
It influences the methods of advertising and promotion that are used.
Advantages of cost plus pricing
1) you know your profit margin per item sold
2)easy calculation
3)you know costs per unit are covered
