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business > Unit 3.1 Marketing > Flashcards

Unit 3.1 Marketing Flashcards

1
Q

What is qualitative data

A

Data about opinions, judgments and attitudes

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2
Q

What is a survey

A

Research involving asking questions of people and organisations

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3
Q

What is marketing

A

The process by which a business satisfies the needs and wants of customers profitably

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4
Q

What is market research

A

It is a way to enable a business to learn about customer needs and wants and how a market currently meets those needs and wants

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5
Q

What ways can a market change

A
  • customer taste
  • kids toys e.g new movies out
  • competitor behaviour
  • the social and legal environment
  • the economic climate
  • technology
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6
Q

Why do we need market research

A

It finds out what the customer wants through primary research
It reduces the risk of failure as the business can base their prices and products on the research
You can understand current customer needs through things like focus groups

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7
Q

What is the market research process (6 steps)

A
  • indentifiy objectives
  • decide research method
  • design the method e.g questionnaire
  • carry it out with chosen group
  • analyse the results
  • react to the results
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8
Q

What are the five different types of surveys

A 
Postal survey (mailed out) 
Newspaper survey (inside newspaper)
Telephone survey (ask them)
Personal interviews (ask in depth questions)
Consumer panels (different market segments and ask)
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9
Q

What is a sample

A

A group that is intended to represent a whole population when talking to everyone in the target population would be too expensive and take too long

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10
Q

What are the pros and cons of a random sample

A

Equal chance of anyone people picked but may select those not in target group so size would need to be large to be fully representative and it’s expensive

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11
Q

What is quota sampling and its pros and cons

A

Done by market segment. It’s not random and a selective editing segment is interviewed so it might not be fully representative but is cheaper

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12
Q

What is stratified random sampling and the pros and cons

A

Samples on the basis of a representative strata or segment. It is still random but more focuses so more relevant informative and could be more cost effective

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13
Q

How does market research help make decisions

A

You can identify any problems with the marketing mix and can adapt and withdraw products if it is needed

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14
Q

What is a product trail

A

The way a business persuades a customer to try its product or services for the first time

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15
Q

What are the different ways of product trail

A 
Free trail
Consumer panel
Free samples
Advertising
Trial price
Money off
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16
Q

What are the advantages of a free trial for the customer

A

Free
Chance to test product quality
Usually easy to obtain
No obligation to continue buying

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17
Q

What are the advantages of free trial for the business

A

Adds contact detail of potential customers to the marketing system
A way to obtain feedback
Customer inertia - once the have tried it they are likely to stick with it

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18
Q

Beside product trial what are the four other ways of encouraging trial

A

Penetration pricing
Public relations
User testing
Advertising

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19
Q

How does penetration pricing work

A

Introducing a new product at a lower price than competitors so gains market share quickly and builds customer usage and loyalty. Raised again once target market share is reached

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20
Q

How does public relations work

A

Activities that create goodwill towards an individual business, cause or product e.g viral marketing

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21
Q

What is viral marketing

A

A way of spreading promotional messages from person to person done by creating content that is begging to be shared like a funny video

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22
Q

What are the main aims of product trial

A

Favourable publicity
Build an image and reputation
To communicate effective with customers and stakeholders

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23
Q

What is user testing

A

Potential customers are encouraged to test an early version of a new product or try the real thing as part of the buying process e.g shoes and cars

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24
Q

What is advertising

A

Various methods of paid for promotion designed to encourage, persuade and inform potential customers e.g TV or billboard

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25
Q

What are the advantages of advertising

A

Wide coverage
Business controls message
Can be used to build loyalty

26
Q

What are the disadvantages of advertising

A

Expensive
Impersonal
One way communication

27
Q

What is a repeat purchase

A

When s customer buys a product more than once

28
Q

How is repeat purchase valuable

A

Less needed to spend on promotion
Satisfied customers pass on news of positive experience
Demand for product becomes more predictable
Retreat customers tend to buy more than first time ones

29
Q

How do you promote customer loyalty

A

Loyalty schemes

Customer relationship management

30
Q

How do loyalty schemes work

A

Several ways to reward customer loyalty and provide rewards based on repeat customer, how much they spend in total, orders for large quantities, prompt payment and length of relationship

31
Q

How does customer relationship management work

A

System that keeps a business in touch with its repeat customers e.g saving emails this builds a strong relationship with customer to reduce marketing costs and improve market research

32
Q

What is the product life cycle

A

A theory which describes the stages a product goes through

33
Q

What are the five stages in a product life cycle

A 
Introduction stage
Growth
Maturity/ saturation 
Decline
Extension strategy
34
Q

Explain the introduction stage of the product life cycle

A

New product launched with a low level of sales.
It has high unit costs so cash is going out of the business and distributions may be reluctant to stock the product.
Needs heavy promotion so expensive.

35
Q

Explain the growth stage of the product life cycle

A

Market expanding but arrival of competitors.
Fast growing sales and easier to get distribution as product gains market acceptance.
Cash flow may be positive.
Market grows and profits rise but new competitors.

36
Q

Explain the maturity stage of the product life cycle

A

Slower sales growth as rivals enter the competition, intense competition.
High profit for those with high market share.
Cash flow should be strongly positive.
Weak competitors leave the market.

37
Q

Explain the decline stage of the product life cycle

A

The product loses popularity so falling sales.
More competitors leave the market.
Customers moved onto better products.
Profit and cash flow fall.

38
Q

Explain the extension strategy of the product life cycle

A

Used to increase the life of a product and prevent it from falling into decline

39
Q

What are the axis of the product life cycle graph

A

Sales |

Time -

40
Q

Ways a business could extend the life of its product

A

Widen product range - larger target market

Find new markets - less competition but smaller market also could alienate existing market

Special promotions - more affordable to existing customers but could make less profit

Extra advertising - more people aware of product but expensive

Find new uses - widen market but could already be a competitive market

Change appearance/ packaging - refresh and appeal to different markets but expensive to manufacture and time consuming also customers may not like or recognise it

41
Q

What is a brand

A

A named product which in the eyes of a consumer is seen to be different from other similar products

42
Q

What is a generic product

A

One made by a number of different businesses which is hard for consumers to recognise any differences between the product of one business compared to the product of another e.g coal

43
Q

What is an own brand product

A

Something manufactured under the name of a shop, chain or other retailer rather than the name of a company that manufactured e.g Sainsburys basic

44
Q

What does branding allow businesses to do

A

Charge a premium price which is above the average for products of a particular type. The business can use the brands USP to increase the sales.

45
Q

What does branding products do to the consumer

A
  • guarantees the next one bought will be virtually the same
  • encourages repeat purchase through brand loyalty
  • helps business differentiate
46
Q

What are the ways to differentiate a product

A

Design- make it look different
Function - making it do unique things other businesses don’t have
Brand name - reputation for quality
Packaging - easy and convenient is better. People recognise
Range - collection of similar products but can spread risk

47
Q

What is quantitative data

A

Data that can be expressed as numbers and can be statistically analysed

48
Q

What is differentiation

A

The distinctiveness of the product being offered as perceived by the customers in the market

49
Q

Three Simplified ways to differentiate a product

A

Distinctive design
Branding
Performance

50
Q

What is price in the marketing mix

A

How much the business charges for a product or service

51
Q

What is product in the marketing mix

A

The goods/ services the business offers. Range and quality and the features, benefits and functions

52
Q

What is place in the marketing mix

A

The location where the business is situated and where

Your products are available from

53
Q

What is promotion in the marketing mix

A

Different ways and methods as to how people find out about the business and methods used to communicate with customer

54
Q

What is the Boston matrix used for

A

A tool of portfolio analysis

55
Q

What is a portfolio

A

The collecting of businesses or products that make up a business

56
Q

What are the axis of the matrix

A

Relative market share – a measure of the firms products strength in the market
Market growth ||| a measure of market attractiveness

57
Q

What is a star product

A

One that is very popular with lots of people, has lots of competition and high level of profit

Market share = high
Market growth = high
Profit = high

58
Q

What is a cash cow

A

A product that has been around for many years and is well known that can help fund investments in star and problem children.

Market share = high
Market growth = low
profit = high

59
Q

What is a question mark/ problem child

A

A new product on the market and could become a dog or a star

Market share = low
Market growth = high
Profit = high

60
Q

What is a dog

A

The product doesn’t make much profit and may be unpopular they may have failed or be in the decline stage of product life cycle

Market share = low
Market growth = low
Profit = zero

61
Q

What is the positioning of the four components in the Boston matrix

A

Market Question marks | stars
Growth ————————-
^ high Dogs | cash cows

Relative market share -> high.

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