Unit 5: Marketing

Question 1

What is Marketing Mix?

Answer 1

The Elements that must be considered for good marketing

Question 2

What are the Four Ps in Marketing Mix?

Answer 2

1) Product: Producing products that fulfil customers needs/wants

2) Price: Reasonable price for product

3) Promotion: attract more customers

4) Place: The area which the product is sold needs to be near target customers

Question 3

What is Market Research?

Answer 3

Identifying the size of a market, its competitors and finding out what customers want/need

Question 4

What is Segmentation?

Answer 4

Dividing people within a market into different groups [Age, Income, Location and Gender]

Question 5

Why is Market Research Beneficial for a Business?

Answer 5

• They can make calculated Business Plans
• Identifying and Satisfying the Customers needs will allow a business to; Increase sales, Beat Competition etc…

Question 6

What is Primary Research?

Describe an Advantage and a Disadvantage.

Answer 6

Gathering new data [interviews, postal questionnaires etc…]
(+) Up-To-Date, relevant and specific
(-) Expensive and Time-Consuming

Question 7

What is Secondary Research?

Describe an Advantage and a Disadvantage.

Answer 7

Using Research that has been conducted [internet, news etc…]
(+) Cheap and easily accessible
(-) Possibly out of date and not specific about you products

Question 8

What is Quantitative data ?

Answer 8

Numerical Data [Statistics etc…]

Question 9

What is Qualitative data ?

Answer 9

Subjective Data

Question 10

What is a Products Life Cycle?

• Look at Product Life Cycle *

Answer 10

1) Research and Development of Product
2) Introducing Product to the Market
3) Growth [Product begins to establish itself]
4) Maturity [Peak of product; most profit]
5) Decline [market favours ‘new’ things and sales drop]

Question 11

What is ‘Extension Strategy’?

Answer 11

When a Business attempts to drag out the life of a product

Question 12

What are some Extension Strategies?

Answer 12

• Adding Different Features
• Targeting new markets [Eg; new country , age group etc…]
• Lowering Price

Question 13

What is Product Portifolio?

Answer 13

The products a Firm sells

Question 14

What is the Boston Matrix?

• Look at a Boston Matrix Box*

Answer 14

A way for a Firm to analyse its product portfolio [the Market Share of each product is considered, as well as its growth.]

Question 15

What does Broad Product Portfolio mean?

Answer 15

To Sell a range of Different Products in your business

Question 16

What is Diversification?

Answer 16

Designing and producing more products

Question 17

What are the Benefits of Developing New Products?

Answer 17

• Businesses are less reliant on the maturity of one product
• Increase Revenue
• New opportunities to expand and grow the business

Question 18

What are the Risks of Developing New Products?

Answer 18

• Costly; investing into research and development is expensive
• Time-Consuming
• Wasting recourses; if customers happen not to be interested
• Ruin Reputation; if a the new product is low quality

Question 19

Benefits of developing a Brand Image?

Answer 19

• Easily Recognised [increase trust in Quality]
• Increase Repeat Purchase [as product is established]

Question 20

What is a Unique Selling Point [USP]?

Answer 20

A feature that sets your product apart from that of the competitors

Question 21

What are Internal Factors that can influence Pricing Decisions?

Answer 21

• Objectives and Aims [maximise profits, or market share]
• Life Cycle of Product
• Internal Costs [cost for equipment, energy etc…]

Question 22

What are External Factors that influence Pricing Decisions?

Answer 22

• Nature of Market [is it a high end luxury market or one for bargain-grabbing]
• Competition in Market [the price competitors price their products etc…]

Question 23

What is Price Penetration

Describe a Pro and Con.

Answer 23

Firms offering very low prices for new products to get lots of people to try it.

(+) Establish Market Share
(-) Little Profit

Question 24

What is Loss Leader Pricing

Describe a Pro and Con.

Answer 24

Setting Price of a certain Product below cost so customers will buy other products that actually make profit.

(+) Draw traffic away from competition
(-) No profit made

Question 25

What is Price Skimming

Describe a Pro and Con.

Answer 25

Charging a high price when products are in high demand

(+) Maximising Profits
(-) Unattractive to lower income Consumers

Question 26

What is Competitive Pricing

Answer 26

Charging similar Prices to other Firms

Question 27

What is Cost-Plus Pricing

Describe a Pro and Con.

Answer 27

Charging based on the amount of profit you want to make

(+) Consistent rate of return
(-) Price may be to high which can be unattractive to customer

Question 28

What is Promotion?

Answer 28

Publicizing a product in order to increase sales

Question 29

How can Firms Promote their Product/Service?

Answer 29

1) Advertisement; Newspapers, Magazines, Poster, Billboards, Internet, Television and Leaflets etc…

2) Sponsor; Giving Money to an Organisation and in return, their product is displayed by the organisation at an event

3) Public Relations; communicating with media about product/service

4) Sales Promotion; Free Samples, 2 for 1 Offers, coupons etc…

5) Use of Social Media

Question 30

What is Promotional mix?

Answer 30

Using a Combination of promotional methods to promote a product

Question 31

The different factors that influence a firms’ promotional mix?

Answer 31

• Finances; More £ = Paying for promotion with higher reach
• Nature of Product; Some Products need lots of description
• Competitors; Cause disruption in Competitors Promotion
• Nature of Market; if the market place is rapidly growing more money may be pumped into promotion etc…

Question 32

What does ‘Channels of Distribution’ mean

Answer 32

How products get from manufacturers to consumers

Question 33

What is E-Commerce?

Answer 33

Selling Goods and Services Online

Question 34

What is M-Commerce?

Answer 34

Allowing Goods and Services to be bought on wireless mobile devices

Question 35

Benefit of E-commerce on Business

Answer 35

• Access Wider Markets [so more potential customers]
• Saves money [domains are cheap compared to rent]
• Open 24/7 unlike most stores

Question 36

Drawback of E-Commerce on Business

Answer 36

• Some Consumers may be reluctant to buy online
• May have to Employ specialist groups to run E-Commerce 24/7