Unit 4 - Marketing Flashcards
1
Q
Market Research
A
- The collection, presentation and analysis of information relating to the marketing and consumption of goods and services
2
Q
Purpose of Market Research
A
- Identify & understand customer needs - can supply products that meet customer needs or can anticipate needs
- Identify gaps in the market - can gain competitive edge & more revenue
- Reduce Risk - reduce risk of failure
- Inform business decisions - can provide information to improve decision making
3
Q
Primary/field research
A
- Gathering of new information that doesn’t exist
4
Q
Methods of primary research
A
- Questionnaires - list of written questions, can be done via post, telephone & in person
- Focus groups or customer panels - number of customers attend a discussion led by market researchers - generalizing can be done but is cost-effective
- Observation - market researchers watch behavior of customers
- Test Marketing - selling a new product in a restricted geographical area to test sales levels & receive feedback
5
Q
Secondary/desk research
A
- Collection of data that already exists
6
Q
Methods of secondary data
A
- Business websites - business history, price lists, product info
- Competitors - annual reports, price lists, product catalogues
- Internal data - sales, stock data, budgets, previous research
- Government publications - population & economic data
- Commercial publications - Data gathered by market researches then sold to businesses
- Media - Newspapers, magazines, directories & TV
7
Q
Qualitative data
A
- Information about attitudes, beliefs and intentions, usually written in words
8
Q
Quantitative data
A
- Information that can be quantified/that is expressed in numbers
9
Q
Role of social media in market research
A
- Playing an increasing role
- Businesses can gather information in a cheap way
- Most social medias have features to analyze trends and conduct market research
10
Q
Importance of reliability of market research data
A
- Often depends on number of people questioned and whether they represent the views of everyone
- Businesses use a sample of people to represent the market or the data will be biased and unreliable
- Answers might also be changed in interviews to make interviewers hear what they want to hear
11
Q
Market
A
Set of arrangements that allows buyers and sellers to communicate and trade in goods and services
12
Q
Marketing
A
Identifying customer needs and satisfying them profitably
13
Q
Importances of marketing
A
- Satisfying customer needs
- Building customer relationships
- Keeping customer loyalty
- Product and market orientation
- Market share and market analysis
- Niche marketing and mass marketing
- Responding to changes in the market
14
Q
Importance of marketing; Satisfying customer needs
A
- Businesses have to satisfy customers’ needs and wants
- Have to produce goods and offer services that customers are prepared to buy
- Identify wants and needs via market research
15
Q
Importance of marketing; building customer relationships
A
- Establish bonds with customers via effective communication
- Businesses can; personalize communication, say thank you, know their customer, connect regularly, build trust & take complaints very seriously
16
Q
Importance of marketing; keeping customer loyalty
A
- is important to retain customers for future purchases
- Reward cards - receive rewards with purchases
- Free gifts - loyal customers can be given free gifts
- Charitable donations - make donations to charity as a result of a customer’s purchase
- Partnership deals - Set up deals with other businesses to share cost or give benefits to customer loyalty
17
Q
Product orientated
A
- Where a business focuses on the design and manufacture of the product itself rather than the needs of customers
18
Q
Market orientated
A
- Where a business focuses on the needs of consumers when developing products
19
Q
Importance of marketing; market share and market analysis
A
- Businesses interested in their market share
- Market analysis to find out features of characteristics of a market - should be ongoing ideally due to the dynamic nature of markets and business
20
Q
Market share equation
A
- Market share = Total product or business sales ÷ Total sales in the Whole Market (x100 for %)
21
Q
Mass markets
A
- Very large markets in which products with mass appeal are marketed
22
Q
Niche markets
A
- Smaller market usually within a large market or industry
23
Q
Importance of marketing; responding to changes in the market
A
- Businesses need to monitor markets to identify changes and adapt
- Changing customer needs - consumers’ income changes or become better educated & sophisticated, can be influenced by social habits, fashions changing over time, new technologies create different demands
- Changing customer/consumer spending patterns - businesses can gather their own data on spending patterns
- Increased competition - behavior of competitors needs to be monitored carefully
- Competition putting businesses under pressure - businesses can lower prices, make products appear different to rivals, offer better quality products, use more powerful/appealing advertising & offer better quality services to get customers to go to them as opposed to rivals to not lose market share
24
Q
Market segments
A
- Part of a whole market where a particular customer group has similar characteristics
25
Q
Market Segmentation
A
- The processing of dividing a broad target market into specific sub-groups (segments) based on shared characteristics e.g. age, gender, income
26
Q
Location (geographical) segmentation
A
- Different customers are likely to have different needs depending on where they live e.g. hot climates vs. cooler climates, cuisine & more
27
Q
Demographic segmentation
A
- Dividing markets on:
- Age
- Gender
- Income
- Social class
- Ethnic origin
- Religion
28
Q
Lifestyle (psychographic) segmentation
A
- Grouping customers through lifestyles when geographic & demographic meet limitations e.g. television broadcasters target sports channels & lovers
29
Q
Benefits of market segmentation
A
- Can increase revenue - can charge higher to specific groups
- Customers may be more loyal - will be more loyal if product is designed for them
- Business may avoid wasting promotional resources - cuts down resources used when only targeting people who are interested
- Can market a wider range of goods to different customer groups
30
Q
Marketing mix
A
- Elements of a firm’s marketing that are designed to meet the needs of customers
31
Q
4 elements of the marketing mix
A
- Product
- Price
- Place
- Promotion
32
Q
Product development process
A
- Generating ideas
- Analysis - based on whether ideas are marketable, possible, legal and a fit with the current portfolio
- Development - possible modifications in design alongside building & testing
- Test marketing - testing the product in a small section of the market that represents the whole market
- Commercialization and launch - final touches on product
33
Q
Packaging
A
- Important because it can be linked with quality
- Factors to consider:
- Environment - materials minimized & should be recyclable
- Cost-effective - weight and shape should not be bulky to keep costs down
- Information - labels need to comply with law and give information
- Design - should be appealing and reflect quality of product + identify the brand
- Convenience - should be easy to handle, open & use
- Protection - strong packaging for fragile or perishable goods
34
Q
Product life cycle
A
- Development - sales at 0 and costs are high, can damage cash flow
- Introduction - costs still high & pricing charged at start may vary
- Growth - sales will start to grow if successful, can start to recover from development costs + costs are likely to fall & profit can be made, sales can grow less quickly towards end
- Maturity and saturation - sales start to level off, development costs recovered, profit is being made & cash flow improving, price likely to fall and business may be forced out of market
- Decline - sales of product decline and eventually taken off market
35
Q
Extension strategies
A
- Methods to lengthening the life of a product before it begins to decline:
- Finding new markets
- Finding new uses for a product
- Modifying the product
- Develop the product range
- Change the appearance or packaging
- Encourage more frequent use of product
36
Q
Product portfolio
A
- Range of products a business is currently marketing
37
Q
Boston matrix 4 categories
A
- Stars - valuable to business w/ high market share and high market growth hence potential to grow - likely to profit
- Cash cows - mature, high market share but low market growth - steady income flow for business
- Question marks - low market share but high market growth - have potential and can do well if right action is taken
- Dogs - end of life cycle - low market share and low market growth - likely to replaced with new products
