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Business > UNIT 2 - MARKETING > Flashcards

UNIT 2 - MARKETING Flashcards

1
Q

How does a business choose the most appropriate form of market research?

A

Purpose of the research, Type of information required, Budget

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2
Q

What are the two types of data in market research?

A

Qualitative, Quantitative

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3
Q

What is quantitative data?

A

Data that is normally numerical.

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4
Q

What is qualitative data?

A

Data based on opinions, attitudes and beliefs.

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5
Q

What are the benefits of qualitative data?

A

Essential for important new product development and launches and focused on understanding customer needs wants and expectations.

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6
Q

What are the disadvantages of qualitative data?

A

Expensive to collect and analyze as it requires specialist research skills and based around personal opinions.

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7
Q

What are the benefits of quantitative data?

A

Data is relatively easy to analyze and shows trends.

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8
Q

What are the disadvantages of quantitative data?

A

Focuses on data rather than explaining why things happen and does not explain the reasons behind numerical trends.

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9
Q

What is market segmentation?

A

Involves the dividing of a market into parts that reflect different customer needs and wants.

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10
Q

What are the categories of market segmentation?

A

Age, Gender, Income, Location, Lifestyle

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11
Q

What are the advantages of market segmentation?

A

Better matching of product to specific customer needs and allows a business to grow its share in a market or to effectively target fast growing segments.

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12
Q

What are the disadvantages of market segmentation?

A

Just because a business can identify a specific market segment does not mean it can successfully reach the customers in it and markets are increasingly dynamic and fast moving and so are the segments in a market.

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13
Q

What is the marketing mix?

A

How a business combines its products, its price and uses promotion and the place of sale in order to be successful.

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14
Q

What is the product in the marketing mix?

A

The good or service that the customer obtains.

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15
Q

What is the place in the marketing mix?

A

How the product is sold and distributed to the customer.

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16
Q

What is the price in the marketing mix?

A

How much the customer is paying for the product.

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17
Q

What is the promotion in the marketing mix?

A

How the customer is found and persuaded to buy the product.

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18
Q

What are the two types of distribution?

A

Physical and Digital

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19
Q

What is physical distribution?

A

Involves the handling, storage and movement of the goods from the producer to the customer.

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20
Q

What is digital distribution?

A

Involves the digital download of goods or services.

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21
Q

What is the main objective of distribution?

A

To make the products available at the right place in the right quantities at the right time.

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22
Q

What is a distribution channel?

A

It moves the product through the stages from the producer to the customer.

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23
Q

What places are involved in the distribution channel?

A

Producer, Wholesaler, Retailer

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24
Q

What is a producer?

A

Supplies the goods or services.

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25
Q

What is a wholesaler?

A

A place that buys in large quantities from the producers and sells in smaller quantities to the retailer.

26
Q

What is a retailer?

A

A shop that sells the product to the consumer either online or through a physical outlet.

27
Q

What is an intermediary?

A

The parts in the distribution channel.

28
Q

What are the advantages of using intermediaries?

A

Access to a large number of customers for the producer and saves costs for the producer.

29
Q

What are the disadvantages of using intermediaries?

A

The product increases in price at every level so that they can make profit and the producer may lose control of how and where the product is sold.

30
Q

What are the advantages of digital distribution?

A

Cost saving, Quick, Convenient, Wider market

31
Q

What are the disadvantages of digital distribution?

A

Some goods can’t be sold this way, Danger of copying and distributing illegally online, Relies on customers having the internet

32
Q

What factors affect the choice of distribution?

A

Nature of the product, Budget, The business itself

33
Q

What could poor distribution affect?

A

Sales, Price, Brand image

34
Q

What are the main factors affecting pricing?

A

Product life cycle, Costs, Competitors, Market share

35
Q

What are the main types of pricing?

A

Penetration, Competitive, Cost plus, Price skimming, Promotional

36
Q

What is price skimming?

A

When a product enters the market at a high price and slowly decreases over time.

37
Q

What are the pros and cons of price skimming?

A

High profits straight away and the business may get a reputation for high quality.

Decrease customers as high in price and is not a long term strategy.

38
Q

What is penetration pricing?

A

When a product enters a market at a low price.

39
Q

What are the pros and cons of penetration pricing?

A

Builds customer loyalty can help build long term profit.

Low profits at the start and hard to raise the selling price in the future.

40
Q

What is cost plus pricing?

A

Setting a price by adding on a mark up or a fixed percentage on top of the costs of production.

41
Q

What are the pros and cons of cost plus pricing?

A

Guaranteed profit on every product sold.

If the mark up is too high the product might be too expensive making the product uncompetitive.

42
Q

What is competitive pricing?

A

When a business looks at the price its competitors are selling their product at and matches it.

43
Q

What are the pros and cons of competitive pricing?

A

Invites new customers as you are charging them the same and stays competitive.

A lot of research will be needed and the business might have to do more to gain customers.

44
Q

What is promotional pricing?

A

When there is a reduction in price to attract existing products.

45
Q

What are the pros and cons of promotional pricing?

A

More sales so cash flow will increase and can help get rid of old stock.

Customers might strategically wait for the sales and the brand image may become tarnished for too many promotional offers.

46
Q

What is loss leaders?

A

When a price is set deliberately low to attract customers who will hopefully buy other profitable products.

47
Q

What factors does a business consider when creating a product?

A

Functional?, Reliable?, Aesthetic?, Quantity?, Economic?

48
Q

What is an invention?

A

The creation of an entirely new product or process.

49
Q

What is innovation?

A

When a new idea is turned into a good or service and becomes a commercial reality.

50
Q

What is the product life cycle?

A

A theoretical model which describes a product goes through over its life.

51
Q

What are the uses of a product life cycle model?

A

Forecast future sales and trends, Helps with market targeting and positioning, Shows where the business should be

52
Q

What are the stages of a product life cycle?

A

Introduction, Growth, Maturity, Decline

Some products may not have a decline stage because of extension strategies.

53
Q

What are some extension strategies?

A

Advertising, Price reduction, Added value, New markets, New packaging

54
Q

Why do businesses promote?

A

Inform, Explain, Persuade, Compete

55
Q

What are the typical methods of promotion?

A

Sales promotion: Point of sale display, Price reductions, Loss leader, Competitions, Free samples, Advertising: Social media, Websites, Radio and TV

56
Q

What factors affect the method of promotion?

A

Stage of the product life cycle, Nature of the product, Competition, Budget, Target market

57
Q

What is the point of sale?

A

The place at which the retail transaction takes place.

58
Q

What are the advantages of sales promotions?

A

Good for getting a quick boost of status, Encourages new customers to trial a product

59
Q

What are the disadvantages of sales promotions?

A

Damage brand image, Customers may manipulate the promotions, Usually only short term

60
Q

What is advertising?

A

Any method of promotion that is paid for.

61
Q

What are the advantages of advertising?

A

Wide coverage, Control of message, Repetition means that the message can be communicated effectively, Effective for building brand awareness and loyalty

62
Q

What are the disadvantages of advertising?

A

Expensive, impersonal, one-way communication so limited ability to close a sale.

Business (6 decks)

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