Unit 7: Marketing Flashcards
What is the definition of marketing?
Marketing is the process of identifying and satisfying customer’ wants and needs, possibly for profit.
Product orientated businesses
Businesses that do not care for marketing. The only thing that matters for them is the product’s efficiency.
Market orientated businesses
Take their direction from what the customers want
What is the primary research consist of?
Field research: Questionnaires, Interviews, Focus Groups.
What are the advantages of primary research?
Face to face interaction, allowing the customer to elaborate on their answer (asked in person) Quick and easy (Telephones) Easy to analyse answers (Questionnaires) Up to date data Quiantifiable
What are the disadvantages of primary research?
Poor responses Not reliable Misleading/biased questions Limited responses Expenses Time consuming
What does the secondary research consist of?
Using the data generated from others
What are the methods for presenting the results of the research? Explain it’s ads and disads.
Pictogram: Easy to understand. Time consuming.
Pie charts: Shows the size of items, not very clear.
Bar charts: Used to compare relative sizes of items that change over time.
Line graphs: Show changes over time to specific variables.
Market Segmentation
Businesses segment the market up into groups of people with different characteristics.
It is easier to meet the wants and needs of those groups of people.
Main segments: Location, Age and Gender, Income and Social Class, Behaviour.
Define the features of a Niche Market
A small market segment Specialised business Unique products Little competition E.g. Tailors who make suits.
Define Mass Market
Large market
Similar products from different businesses
More competition
Large scale production
Products are targeted at general consumers
What does the Marketing Mix consists of?
The 4 Ps: Price, Product, Promotion, Place
What are the 5 pricing strategies? Explain.
1) Cost plus pricing: put a price on a product then put a percentage on.
2) Psychological pricing: E.g. $1.99. Making people think the price is lower than it is.
3) Competitive pricing: Setting just below their their rivals
4) Skimming: Setting a high price to begin with and then lowering the price to attract a wider market segment.
5) Penetration pricing: Setting a low price to begin with to win customers
Price elasticity
Price elasticity = %change in quantity sold / % change in price
from -1 and lower = Responsive
-1 = Equally responsive
0 and above = Unresponsive
What are the packaging purposes?
Enable branding Attractive boost Easier storing Protection Written Guidance
What is a brand?
A product or a group of products with an easily recognisable character
A product’s life cycles (A graph) stages
Introduction, Growth, Maturity, Saturation, Decline
What are the strategies to prolong the product’s life cycle?
Modify the product
Changing prices
Promotional campaign
Altering distribution patterns
What are the organisations that take part in distribution? Explain.
Manufactures: firms that make the product
Wholesalers: Store goods
Retailers: Sell goods to customers
E-tailers: Retailers via the internet.
What is promotion (in marketing)?
A process of making consumers aware of the product
what are the forms of promotion? Explain.
Advertising: TV advertisements, Posters, Banners…
Sales promotions: E.g. Competitions, discounts, free gifts
Personal selling: Building a personal relationship with costumers
Public relation: Communication through publication, website, newsletter. Only positive messages.
Advantages of Advertising
Customer’s awareness
Improve business reputation
Adds value to the product
Brings profit from taxes to the government
Disadvantages of Advertising
Adverts can be deceiving
Advert may target the wrong people
Expensive
Can create envy
How to make up a marketing strategy
To choose the right combination from the marketing mix to support to product. The best possible mix will depend on the stage of the product’s life cycle. Over time the marketing mix would need adjustments.
What is a Marketing Budget?
A budget is a financial plan for a business. It is a plan usually agreed in advance to which sets out the targets or goals that must be reached in an organisation.
Budget acts as a control on business spending or what the business has to achieve for example, sales.
Budgets must be realistic and agreed on (SMART)
What is cost effectiveness?
Cost effectiveness describes the relationship between the cost of an activity and the returns from it. High cost, High impact = Cost effective High cost, Low impact = Cost ineffective Low cost, High impact = Cost effective Low cost, Low impact = Cost ineffective
