Unit 3 Flashcards
What is marketing
The communication between a business and its(potential) customers in order to create and encourage sales
What is the purpose of marketing
To increase sales by identifying,anticipating and satisfying customer,this requires profitability
What is a market
Where buyers and sellers transact
What are the 2 types of markets
Retail(physical)
E-commerce(online)
What are examples of markets
Food and beverage
Tech
Clothing
Health care
What are objectives
Targets set by the marketing function
What are some key marketing objectives
Sales growth(percentage change)
Sales volume
Sales value (£)
Launching new products
Entering new markets
What is the process of marketing objectives
1.Define the main goal
2.Outline the objectives
3.Break out objectives into tasks
4.Tie tasks to dates
What are the key marketing measures
Market size
Market growth
Market share
What is FMCG
Fats moving consumer goods
What is the role of market research
Competitor analysis
Identify trends in the market
Aid pricing strategies
Meeting consumer needs
Ideas for development
Customer feedback
What is quantitative data
Facts and figures
What is qualitative research
Customers thoughts and feelings on a product
What is primary research
Data collected first hand for a specific business
What is secondary data
Looking at data that already exists
What are some primary research methods
Surveys/questionares
Observations
Focus groups
What are some positives of surveys/questionares
Reach a large target audience
Mix of qualitative and quantitative responses
Can usually gather much info from large sample
What is a negative of surveys/questionares
Depends on who’s writing the questions
What are positives of observations
Real world experience
What are negatives of observations
Small sample size
Time consuming
What are negatives of focus groups
Can be bias because they’re being paid to take part
Can be pressured by other people in the group
What is a positive of focus groups
Helps avoid risk by getting feedback
What are types of secondary market research methods
Newspapers
Internet
Government market research reports
Published reports by industry publications
What is the formula for market share
Company’s revenue (divided )entire market revenue x100
What is a confidence interval
Gives percentage probability that an estimated range of possible values in fact includes the actual values being estimated
It’s a range of outcomes
What is correlation
Occurs when there is a relationship/link between 2 factors
What affects sales
Pricing
Share holders
Quality
State of economy
Marketing activity
Seasonal events
What is a positive correlation
Relationship of 2 variables where they increase or decrease together
What is a negative correlation
Relationship between 2 variables that where in opposite directions
A increases, B decreases
What is extrapolation
Use of trends from historical data to forecast the data
What are pros of extrapolation
Aids decision making
Useful method to help predict future
The more historic data the more reliable it is for the future
Allows businesses to make informed business decisions
What are cons of extrapolation
External factors such as rivals and economy
Validity of data
Can be bias
What is the value of tech gathering data
Provides faster communication
Makes forecasting easier
Enables targeted sales messages
Relies on the business having right data in the first place
What is elasticity of demand
Measures responsiveness of demand to a change in price or income
Means it’s price sensitive
What is price elasticity
How significantly price demand changes when price changes
What is income elasticity
How significantly demand changes when income changes
What is the calculation for PED
%change in demand➗%change in price
Is elasticity is greater than 1 it means
It is deemed as price elastic
If elasticity is less than 1 it means the price is
Inelastic
What factors affect PED
Strength of brand
Whether there are reasonable substitutes
Whether product is a necessity or not
What is the formula for YED
%change in the demand➗%change in income
What are necessities
Normal everyday goods and are in an elasticity of demand of between 0 and
demand is rising but less proportionately to income
What is a luxury good
Good and services that have an income elasticity of above 1
If demand rises more than proportionally to a change in income
What is an inferior good
Negative income in elasticity of demand
YED is negative because increase in income means a fall in demand
This means demand falls as income rises
E.g low priced label foods
