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BUSINESS 😐 > UNIT 5 MARKETING 😐 > Flashcards

UNIT 5 MARKETING 😐 Flashcards

1
Q

four p(s) in marketing

A

price - customer must think the product is good value for money
product - must identify customer needs or wants
place - must be sold in a place convenient
promotion - potential customers must be aware that it exists

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2
Q

market size

A

the number of individuals within the market which are potential buyers or sellers of products

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3
Q

market share

A

the proportion of total sales within the market that is controlled by the business

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4
Q

what is segmentation and examples of ways a market can be segmented

A

segmentation is when people within a market are divided into different groups
examples:
age
income
location
gender

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5
Q

why is market research important?

A

helps a business to understand its customers and competitors (helps create a good marketing mix)
helps identify their customers needs and therefore be more likely to provide products that satisfy those needs and that customers will buy

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6
Q

benefits of satisfying customer needs/market research

A

increase sales - knowing demand can help adjust pricing, avoiding costly mistakes
stay competitive - gathering information on products and prices of competitors can help them strategize
create targeted marketing - understanding their target market can help the business to produce promotional material

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7
Q

market research

A

the process of gathering, analysing and processing data relevant to marketing decisions

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8
Q

target market

A

the group of consumers to which a business intends to sell a particular product

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9
Q

primary research

A

involves asking customers for their opinions and surveys, using data gathered by yourself or for the first time

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10
Q

secondary research

A

looking at past pre-existing research of past trends that have already been collected by someone else

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11
Q

benefits and drawbacks of primary research

A

benefits:
+questionnaires are cheap
+up to date
+reliable and relevant specific to your business
drawbacks:
-expensive
-time consuming

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12
Q

methods of primary research

A
  • questionnaires
    -phone surveys
    -focus groups(small group of people discuss their opinions of a product)
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13
Q

benefits and drawbacks of secondary market research:

A

benefits:
+cheaper than primary
+instantly available
+easily found
drawbacks
-not always relevant to your needs
-can be out of date

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14
Q

methods of secondary research

A

-government publications
-articles in newspapers
-magazines on the internet

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15
Q

qualitative data

A

customers thoughts and feelings, non numerical value

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16
Q

quantitative data

A

statistics and numerical information and data

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17
Q

product life cycle

A
  1. research and development - develop an idea and turn it into a marketable product
  2. introduction - product is launched and put on sale (advertising and sales promotion)
  3. growth - demand increases until product becomes established
  4. maturity - demand reaches its peak. as popularity grows businesses will try to make it more widely available
  5. decline - demand starts to fall as rival products take over
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18
Q

extension strategies to extend the life of products

A

-adding more or different features (more useful/appealing)
-using new packaging (more eye-catching)
-targeting new markets
-changing advertisements (make more people aware of the product)
-lowering price (reduce price of the product)

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19
Q

product portfolio

A

range of different products a business sells

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20
Q

what is the boston matrix?

A

a way for a firm to analyse its product portfolio

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21
Q

PROBLEM CHILD/ QUESTION MARKS

A

-new products
-small market share, high market growth
-are not yet profitable and need heavy marketing

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22
Q

DOGS

A

-low market share
-low market growth

23
Q

CASH COWS

A

-high market share
-low market growth
-costs are low since they have already been promoted and are produced in high volumes

24
Q

STARS

A

-high market share
-high market growth

25
Q

how can businesses broaden their portfolios

A

-adding products to an existing range by developing new products based on their current ones
-increase their range of products by developing products that are different from their current oness

26
Q

benefits and risks of developing new products

A

benefits:
+increase overall sales and may extend life cycle of existing products
+appeal to new market segment (more business opportunities)
+initially charge higher prices before competitors bring similar products to the market
+good for reputation
risks:
-costly
-time-consuming
-can end up wasting resources by developing something customers dont want
-risk their reputation if it does poorly

26
Q

effect of brand image for products

A

-can help increase sales (if a brand is easily recognised, it would be more likely to be chosen over competing products)

27
Q

product differentiation and key things that should be different

A

making your products distinctive in the market
-give your products a unique selling point (a feature that stands out from competitors)
-product design (function, cost and appearance)

28
Q

Five Pricing Strategies

A

Price penetration
Price skimming
Loss Leader Pricing
Competition Pricing
Cost-plus Pricing

29
Q

price penetration

A

new product is set to a very low price to get lots of people to try it
-initially make very little profit until once it becomes established and the firm increases the price
-good way to establish a market share(sales)

30
Q

price skimming

A

initially charging a high price (better if they know there will be a high demand) eg desirable USP
-works for established firms as they have more loyal customers who will be willing to pay a high price
-helps the firm increase revenue to cover costs
-high price = more desirable to people with high incomes (rich people), improving status and image
-once its established fully the firm lowers the price to help it become a mass market product

31
Q

competitive pricing

A

firm charges similar prices to other firms
-happens when there is a lot of choice but no differentiation
-firm may make very little profit

32
Q

loss leader pricing

A

when the price of a product is set below cost (firm does not make a profit)
-increase likelihood of customer buying the product as well as other products they have to make actual profit

33
Q

cost plus pricing

A

the firm works out the total cost of making the product and then adds on a certain amount depending on how much profit they want to make while still having a reasonable demand

34
Q

2 method of cost plus pricing

A

-using a mark up
-using a profit margin

35
Q

what is using a mark up (CPP)

A

work out how much the product costs to make and then add a percentage mark-up

36
Q

what is using a profit margin

A

work out how much the product costs and increase it to get the profit margin you want.

37
Q

affects of demand when setting prices

A

-as prices rise, demand for a product tends to fall
-this leads to firms making the decision to make sure that the price of a product isnt so high that they wont sell many
-HOWEVER SOMETIMES FIRMS MAY NEED TO SET THE PRICE LOWER THAN THE TOTAL COST OF MAKING THE PRODUCT so that there is still a decent level of demand for the product

38
Q

what is demand

A

the quantity of a product that customers are able and willing to buy

39
Q

internal factors influencing pricing decisions

A

-business’s aims and objectives (if a business is aiming to increase market share, may lower prices AND if a business aims to expand, it may maximise amount of products to fund expansion

-internal costs (if a business finds cheaper machinery, its costs will fall long term, meaning that can afford to charge less)

-when the product is in the introduction and growth phases of life cycle a firm may charge very low or very high to encourage sales

-marketing mix (if a business wishes to promote a product it may reduce its price for a period)

40
Q

external factors influencing pricing decisions

A

-nature of the market (eg if its luxury)
-if its in a competitive market, firm must now other firms prices
-costs (costs of raw materials)

41
Q

reasons for promotion

A

-inform customers that the product is exists
-persuade customers to buy the product
-create or change the image of a product
-create or increase sales

42
Q

methods of advertising

A

newspapers - good for reaching a specific geographical area
posters and billboards - place near a target audience for a long time so it is seen daily by people
internet adverts - can be seen at anytime by a large targeted audiences
magazines - good for targeting specialist markets over a wide area (can be pricier than newspaper adverts but they are better quality)
leaflets - cheap to produce and distribute. can be targeted at certain areas and people can keep them until they need the info.

43
Q

sponsorship and risks

A

firms give money to organisations and events in return for their name to be displayed

-can create a high profile but if the thing you are sponsoring starts to get bad publicity your company’s image might suffer too

44
Q

public relations (PR)

A

PR involves communicating with the media eg press release and interviews

45
Q

benefits and risks of PR

A

benefits:
-cheap and easy to get noticed by a wide audience
risks:
-little control over what the public get to see or hear
-activities can be criticised

46
Q

Sales promotion

A

short term method used to boost sales

47
Q

six sales promotion methods that firms use:

A

-competitions
-2 for 1 offers
-free samples
-coupons
-point of sale displays
-free gifts

48
Q

advs and disadvs of sales promotion

A

advantages:
+should encourage new customers to try a product, which will boost sales in the short term but POSSIBLY increase sales long term if product is liked
disadvantages:
-customers get used to seeing products on promotion and may be reluctant to buy them, making it seem to customers that it is less of a luxury item

49
Q

how can firms use social media to promote products

A

-can advertise their products
-offer sales promotions
-share news stories to build up excitement for upcoming products

50
Q

benefits and drawbacks of using social media to promote products

A

benefits:
+quick
+easy and cheap
+add information at any time so they can respond quickly to internal or external changes
-customers can go quickly from the social media page to the firms website where they can buy products
drawbacks:
-mistakes or negative comments can be seen quickly by lots of people, so time and money needs to be spent carefully monitoring the site

51
Q

PROMOTIONAL MIX

A

the combination of different promotional methods to promote a product (?)
-finance available
-nature of product or service
-what competitors are doing
-nature of market
-target market (promotions may need to be in a place that will be seen by the right people and need to be presented in a way that it’ll appeal to the right people)

52
Q

3 channels of distribution

A

-selling to wholesalers
-selling directly to retailers
-selling directly to consumers

53
Q
A

BUSINESS 😐 (5 decks)

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