Unit 2 (Marketing) Flashcards
\What is marketing?
Marketing is the management process of identifying, anticipating and satisfying consumer requirements such as their needs and wants
What is market orientation?
Will research what consumers needs and wants are then produce the product to facilitate those needs and wants.
What is product orientation?
Looking at what they can make instead of making products that they can sell. Focuses on making products that they hope to be demanded by the market.
Market orientation advantages?
- Greater flexibility, ability to respond quickly to change in market from market information
- Lower risk, confident that products will sell as they meet needs and wants of consumers
Market orientation disadvantages?
Market research - Can be expensive and time consuming to conduct
No guarantee - dynamic nature of external environment, research might be outdated
Product orientation advantages?
- Quality assured
- More control over operations
- Specialised in making specific product
Product orientation disadvantages?
- Needs of market are ignored
- High risk with high chance of failure
What is market share?
Organisation’s shares of total value of sales in specific industry, firms with higher market share benefit from status, price setting abilities and less threat.
What is market share formula?
Firm’s sales revenue / Industry’s sales revenue * 100
Ways to increase market share?
- Brand promotion
- Product development
- Motivating / training workforce
- Using efficient channels of distribution
What is market growth?
The rate at which a size of market increases or decreases
Fórmula for market growth?
Current market size - original market size / original market size * 100
What is market leadership?
Position of business having largest market share in a given market?
Advantages of market leadership?
- Premium pricing
- Economies of scales
- Longer product life cycles
- Favourable distribution, better location
- Better publicity / brand exposure
- Easier to attract and recruit qualified employees
What is the process of marketing planning?
Process of devising marketing objectives and appropriate strategies to achieve these goals
What are the steps of these processes for marketing planning?
- Identify market audience
- Set marketing objectives
- Plan marketing strategies
- Monitor and review performance
- Evaluation
Adv of planning?
- Increase chances of success
- Clear objectives and constraints
- Better understanding and control
What is segmentation?
Market for a particular good or service of different types of consumers into market segments.
What are demographic factors of segmentation?
Study of characteristics in human population with area, country or region.
Includes:
- Age
- Race
- Religión
- Income
- Gender
- Marital status
- Language
- Social economic class
What is the target market?
Firm using to sell to a particular market segment known as target market
What is the disadvantages of planning?
- Time cost
- Money cost
- HR cost
- Plan may be inflexible or outdated
What is the market segment?
Different groups of consumers with similar characteristics with similar needs and wants.
What are consumer profiles?
Similar characteristics based on a consumer profiles such as demographic, geographic and psychological factors.
What is geographical factors of segmentation?
Location of customers have implications for segmentation because demographic can be influenced by geographical issues.
- Location
- Climate
What is psychological factors of segmentation?
Factors considering emotions and lifestyles of consumers
- Hobbies / interests
- Values
- Religion
- Status
- Culture
What are demographical factors of segmentation?
Study of characteristics in human population with area, country or region
- Age
- Race
- Religión
- Income
- Gender
- Marital status
- Language
- Social economic class
What are position maps?
Customer perceptions of product or brand in relation to the competition in the market, this allows business to identify gaps in product portfolio and refine strategies such as target markets and overcoming undesirable customer perceptions.
What is a niche market?
Targets a specific and defined market segment such as luxury goods and minority sports.
What are adv of niche market?
- Better marketing focus
- higher price due to less competition
- Specialized in meeting needs and wants
what are dis of niche markets?
- Limited customer base
- Fewer economies of scale
- Successful marekts can attract competition
What are mass markets?
Targets multiple market segments to maximize sales such as cola, nike, apples, and more
What are adv of mass markets?
- Economies of scale
- Able to use marketing to address optimum market
- Large customer base
What are dis of mass markets?
- Higher barriers to entry
- Heavy competition
- Less focus, many do not satisfy individuals’ needs and wants
What are unique selling points?
Aspect of a business that makes them stand out from competitors, explains why customers buy products over rivals
EX:
- Only firm in a certain area
- Reputation for high-quality or low cost
- Popular slogan
How do businesses differentiate?
- Act of distinguishing a business or its products from rivals in the industry
- Differentiation often from marketing mix
What are adv of differentiation?
- Brand recognition/loyalty
- Distribution advantages
What is dis of differentiation?
- Costly to make
- Economies of scale cannot be exploited
- Excessive differentiation can cause confusion
What is sales forecasting?
Numerical way to predict the level of sales over some time
Useful to firms to help identify problems and opportunities in advance
What are ways to sales forecast?
- Market research
- Time series and analysis
- Extrapolation
What is extrapolation?
Identifying trends by using past data and extending the trend to predict future sales.
What is market research?
Identifying and forecasting the buying habits of consumers is vital to a firm’s survival and prosperity.
What is time series analysis?
Predict the level of sales by identifying the underlying trend from a sequence of sales figures
The main elements are:
- Seasonal variations
- Random variation
- CYcliccal variation from economic growth/regression
what are adv of time series analysis?
- Working capital and cash flow
- Stock control
- Productive efficiency
- Secure external sources of finance
What are dis of time series analysis?
- Limited information
- Bad data leads to bad decisions
- External influences
- Inaccuracy of predictions
What is the role of market research?
Refers to marketing activities designed to discover opinions beliefs and preferences of potential and existing customers of industry operated in.
What is the purpose of market research?
- Up-to-date information
- Tailors market mixes for their target segments
- Assess customer reaction to products
- Helps understand activities and strategies used by rivals
- Helps understand trends in the market for the future
What is primary research?
The process of gathering information directly from consumers in the target market using field research methods gathers new information that is new and doesn’t exist in any format.
What are adv of primary research?
- Focuses on the needs of the business
- Info is not available to rivals
- Can get in-depth information from respondents
- More up-to-date and can be used to ask specific questions, more relevant to business
What are dis of primary research?
- Sample size too small and unrepresentative of all consumers leading to unreliable results
- Respondants may respond in particular ways or influenced by response of others leading to inaccurate information.
- May need to hire specialists in a market research agency to help process which is time consuming and expensive
What are surveys?
- Method where a series of questions are asked to a certain number of people, results from the sample are used to make inferences and thus extrapolated to apply to the wider population.
- Wide range reached using online survey tools and websites
ADV of surveys?
- Lots of data collected quickly
- Easily completed by respondents
DIS of surveys?
- Can result in poor or inaccurate results
- Random sampling can lead to bad results
What are interviews?
Questions asked by interviewers through verbal conversations, takers longer but allow for follow-up questions to gather info that can easily be missed in surveys.
Adv of interviews?
- Provides detailed opinions and perceptions
- high response rates can be achieved
DIS of interviews?
- Time-consuming process as interviews are one-to-one
- Interview bias can affect the validity of results.
What are focus groups?
Free-range discussions to collect detailed feedback on all marketing mixes from target markets, limited to small groups of 4-6 people.
Adv of focus groups?
- Detailed information on opinions and perceptions gathered
- Small groups are relatively easy and inexpensive to organize
- Less time-consuming as data from multiple people gathered at once
Dis of focus groups?
- May be relevant to share true opinions in group situations or influenced by other responses
- Rewards for participation can be more expensive than other methods.
What are observations?
To stand in an appropriate location to study consumer behavior in a store to judge potential customer traffic at certain locations.
Adv of observations?
- Useful for capturing data on human behavior
- A large number of consumers observed in a short period
Dis of observations?
- Needs to be combined with other methods to create logical analysis and conclusions with results.
What is secondary research?
Involves the collection, compilation, and analysis of data that already exists.
What are adv of secondary research?
- Information abroad available, quicker to collect than primary research, and saves time
- Info is free, and cheaper to collect thus lowering marketing costs
- Suitable for small businesses with a smaller marketing budget
What are dis of secondary research?
- Collected for other purposes and may lack relevance or not be valid
- Expensive to purchase specific secondary data from specialized companies
- Information may be out of date, especially in fast-growing industry
- Information also available to competitors
What are marketing analyses?
Companies specialty in market research produce and sell in-depth reports on various industries, markets, and consumer trends.
What are academic journals?
Research conducted by university-published research papers provides insight and data on specific industries, consumer behaviors, and market trends.
What are government publications?
Government reports and statistics such as economy, demographics, industry trends and consumer behaviour.
What are media articles?
Articles, opinion pieces, and investigation reports that offer insight into market trends, consumer behavior, and industry developments.
What are online databases?
Provide access to a wide range of secondary market research.
What is qualitative data?
Open-ended questions on opinions from respondents aimed to understand behaviors, activities, and perceptions of consumers, employees, or other respondents
What is quantitative data?
Close-ended questions that are numerical data able to be measured, info is more factual and measurable rather than opinion-based.
What is sampling?
practice of selecting a small group of population for a particular market for primary research purposes
What is quota sampling?
A certain number of people selected from different market segments
Quota sampling adv?
- Relatively representative sample collected quickly
- Findings more reliable than random sampling