UNIT 3 Flashcards
market capitalisation definition
total value of all shares in a business
marketing definition
process of identifying, anticipating and meeting customer needs
4 steps of marketing
recognising demand
anticipating demand
stimulating demand
satisfying demand
market size definition
total value of total volume of goods sold
market growth
an increase in the sales volume of products
mass market
lots of companies producing the same product, usually quite affordable
niche market
small, specialised market
market share
% of sales in a market generated by one business
how to calculate market share
total sales of business/total sale in market
all then times by 100
5 marketing AIMS
- understanding customer needs and wants
- developing new products
- improving profitability
- inc market share
- increase brand awareness
3 marketing objectives
- grow market share
- grow market size
- increase brand loyalty
influences on marketing ( internal examples )
• cost of campaign
• availability of finance
• staff expertise
• size and culture of business
influences on marketing ( external factors )
PESTLE
primary market research
data collected by a specific business/ individual for a specific purpose
secondary market research
data already exists, the individual/ business decides how to interpret the data
examples of primary research
interviews, surveys, focus groups
examples of secondary research
online, MINTEL, newspapers
3 advantages of primary research
- specific to your business
- up to date data
- this is data no competitors can access
3 disadvantages of primary research
timely
costly
results bias
3 advantages of secondary research
highlights gaps in the market
accessible immediately
broadens knowledge of opinion
3 disadvantages of secondary research
- may be out of date/ irrelevant
- competitors can access
- might be not accurate
whats the difference between qualitative and quantitative data
qualitative data portrays opinions and how consumers feel, however quantitative data produces numerical results
define sampling
selecting a representative group of people from the target market
2 advantages of sampling
quick and easy
large sample means reliable results
name the 4 types of sampling
convenience- available pps
random- random selection
quota- same characteristics
cluster- more similiar characteristics
define extrapolation
predicting trends in the future
based on past results
the further predicted in the future, the increase in risk
define market positioning
the strategic process of establishing a brand or product in the minds of consumers
whats product differentiation
distinguishing product/ service from rival firms
whats a market map
a grid that shows a range of positions for 2 features in a business
for example: price and quality
advantage and disadvantage of a market map
A- spots gaps in the market
A- useful for analysing competitors
D- how reliable is the research?
what does PED stand for
price elasticity of demand
if a product has a ped less than -1, is it elastic or inelastic
elastic
whats a unitary elastic good
a change in demand which equals to the demand in price
name the 4P’s
price, product, place, promotion
how to calculate PED
% change in demand/ % change in price
all times by 100
name the 5 influences in PED
- product will be more elastic if more substitutes are available
- more expensive= more elastic
- luxury= elastic , necessity= inelastic
- the more addictive, the more elastic
- short term= elastic, long term= inelastic due to substitutes
whats the difference between an elastic and inelastic good
an elastic good is a luxury, an inelastic is a necessity. the demand of an inelastic good will not change with the price
whats YED
how quantity demanded changes with income
calculation for YED
% change un quantity demand/ % change in income
what is market segmentation
dividing criteria, making market share smaller
market segments
people who have similar characteristics and buying habits
6 examples of market segments
behavioural- when do they buy
income
demographic
geographic
occupation
education
benefits of market segmentation
- makes consumers easier to target
- higher levels of loyalty
-better reputation
what does STP stand for
- segment - divide
- think- which to appeal
- position- product in consumers mind
whats a market strategy
set of plans to achieve market objective
whats the product life cycle
introduction, growth, maturity, decline
what goes quick through the life cycle
up to date trends eg: slime, loombands
advantages of market maps
spot gaps in the market and is useful for analysing competitors
what is the boston matrix
a grid which categorises businesses products, according to market share and growth
what does the star stand for in the boston matrix
growth stage
competitive product
new, successful products
what does the cash cow stage in the boston matrix
product is already established, doesnt need promoting
high customer loyalty
maturity stage
what does the problem child stand for in the boston matrix
INTRODUCTION
low market share
issues for business
what does the dogs stand for in the boston matrix
DECLINE
product which should be withdrawn
unsuccessful
name the 6 pricing strategies
price penetration
price skimming
cost plus pricing
dynamic
psychological
competitive
adv and disadv of price penetration
adv- loyal customer base
disadv- may turn consumers
adv and disadv of price skimming
adv- initial sales covers research
disadv- may put off consumers and lead them to question quality
adv and disadv of cost plus
a- control over price
d- profit loss potential
adv and disadv of psychological pricing
a- increased sales
d- lack prestige
dynamic pricing adv and disadv
a- inc revenue and customer satisfaction
d- confusing to create and timely
adv and disadv of competition pricing
pricing based off awareness and adjusting to competitors
adv- takes market share
disa- reduced profit
5 influences on pricing strategy
costs
unique selling point
target market
stage in PLC
brand image
whats distribution
refers to making a product/ service available when and where consumers need it
whats the difference between retailing and e tailing
retailing is in a physical shop however e tailing is online
name the 4 channels of distribution
- manufacturer- customer ( perishable or small business )
- manufacturer- retail- consumer
- manufacturer- wholesaler-retail- customer
- manufacturer- agent - wholesaler- retail- customer
benefits of distribution channels
try on products
displays to attract
advice and help
enjoy experience
benefits of online
cheaper for business
open 24/7
access to all countries
disadvantage of online
shipping cost
cannot try on immediately
waiting
7ps
product, price, promotion, place, people, process, physical environment
7ps
product, price, promotion, place, people, process, physical environment
