Unit 3 Flashcards
Types of marketing objectives
- Sales volume and sales value
- Market size
- Market and sales growth
- Brand loyalty
The value of setting a marketing objective
- Target setting that allows a sense of direction
- Employee engagement and motivation
- Evaluating the performance of a business
Internal influences of marketing objectives and decisions
-Finance: the budget given to use for marketing
-Production capacity: must be physically possible to achieve targets.
Human resources: market growth may depend on the skill of the workforce
-Nature of growth: innovative products are more incline to a scope of growth
external influences on marketing objectives
-Market and competition: Varies on the state of the market and competitors
- Economic factors: The economic cycle, interests rate which may affect consumer spending
-Social factors: Consumer taste change overtime
-Ethics: Consumers are more woke
- Technology: Affects the way a business both produces and sells.
The value of sampling
- Samples represent the whole target market due to the principle being the larger the sample the more accurate it will be.
Ways sampling can be collected
- Random sampling: where each member of the public has an equal chance of being selected
- Stratified random sampling: Separates the population into segments.
- Quota sampling: Splits the population into a number of groups that share characteristics. More efficient
Factors influencing choice of sampling
- Pricing policies
-Product design
-Types of promotion - Target customers
Extrapolation
Uses known data to predict the future.
By using past sales it may be possible to predict future sales by a trend line
Treat with caution with industires such as fashion and technology
The value of technology in marketing decision making
- Provides faster communication
- Makes forecasting easier
-Enables targeted sales messages - However, relies on having correct data in the first place
Market mapping
- Enables a business to identify the position of its product in the relevant market.
- Main features include price and quality
Market segmentation
Dividing the market in sub-markets with each of its own customer characteristics
Mass markets
- Business must produce on a large scale
- Need to be price competitive
- Have a strong USP
The marketing mix (7Ps)
The 4 ps included : Price, Product, Place, Promotion
The extended mix: People, process and the physical environment
Factors to consider when designing a marketing mix
- Technology
- Finance
- Market research
- Nature of the product
Influences on new product development
-Technology: Firms use technological advances for basis of development to meet the demands of a consumer fully.
-Competitors actions: A competitor product or service may be better which in turn will encourage the business to inspire to be better
- The entrepreneurial skills of managers and owners: The skill of being able to create new ideas that fit the customer needs.
Extension strategies used in the life cycle
- Finding new markets for existing products- Ansoff’s matrix
- changing the appearance or packaging of a product.
What does the Boston matrix include
- Star products- have a dominant share of the market and good growth prospects
- Cash cows- are products with a dominant market share but low growth
- Dogs- have a low market share and low prospects for growth
Problem children- Are products with a small share of a growing market
Conclusions you get from the matrix
- Firms should avoid having too many products in a single category
- Continuing production of a cash cow can allow cash to develop new products
- Firms need problem children products as they could grow to be a cash cow.
Characteristics of a star product
- Market leaders
- Fast growing
- Substantial products
- Requires substantial investment to finance growth
Characteristics of a problem child
- Rapid growth
- Poor profit margins
- Enormous demand for cash
Characteristics of a cash cow
- Profitable products
- Generate more cash than needed to maintain a market share
Characteristics of a Dog
- Greatest number of products in this category
- Markets are not growing
- operate at a cost of disadvantage
Price Skimming
Where products are in a new market and are listed at a high price with limited sales that allow high profit margins to trial where their price will fit in the market.
The competitive price will then be listed again
Penetration pricing
-The price will be set at a very low price at first to gain a foothold in the market. Once the product is recognised it will then be increased to then up their profit margins
