1.3 Marketing Mix + Strategy Flashcards

Question

What are the benefits of branding?

Answer 1

Adds values by creating a perception of quality, reliability and trust Ability to charge premium prices as customers may be willing to pay more for a product that is associated with a well-established brand Reduced price elasticity of demand because customers who are loyal to a brand are more likely to continue purchasing the product even if the price increases

Answer 2

- by developing USPs - through advertising - through sponsorship - through the use of social media

Answer 3

The features that make a product/service stand out from its competitors Brands can build their reputation by emphasising these unique qualities in their marketing efforts E.g. apple known for its innovative and sleek design

Answer 4

Brands can create compelling ads that resonate with their target audience, raise brand awareness, and communicate their value proposition With the right advertising strategy, brands create a strong emotional connection with their audience and inspire brand loyalty E.g. coca-cola has successfully built its brand through advertising

Answer 5

Partnering with events, organisations, or individuals can help brands gain exposure and build their reputation by aligning themselves with positive associations or values E.g. Nike sponsoring many high-profile athletes and sports events such as the olympics

Answer 6

With the right social media strategy, brands can build a loyal following and create a community around their brand E.g. glossier has a strong presence of platforms like instagram and it engages with its audience and shares user-generated content

Answer 7

A strategy where businesses use online platforms to promote their products by creating content at specific times, which can easily be shared and commented on E.g. during the COVID-19 pandemic, coca-cola and McDonald’s ran campaigns that emphasised community, which aligned with the public’s need for social support

Answer 8

As social media platforms evolve, businesses must also adapt their social media strategies to keep up with the latest trends E.g. instagram has been a popular platform for businesses to promote their products through influencer partnerships

Answer 9

A strategy where companies build strong emotional connections with their customers by appealing to their values, beliefs, and emotions E.g. brands like Patagonia have built their entire brand identity around their commitments to environmental and social causes, which resonates with customers who prioritise these values

Answer 10

Cost plus Price skimming Psychological Predatory Competitive Penetration

Answer 11

Where the business calculates the cost of production and then adds a markup to determine the final price The markup covers the cost of production plus the business’s desired profit margin Commonly used by manufacturers that produce standardised goods e.g. washing machines

Answer 12

Unit cost + (mark up percentage x unit cost)

Answer 13

Where the businesses sees a high initial price for a new product/service This is effective when an established brand is introducing a new product and there is a high demand for it, e.g. successive models of Apple's MacBook Air The high price helps the business recover its development and marketing costs quickly The business will then gradually lower the price to ensure sales continue

Answer 14

Where the business sets a low initial price for a new product/service This is effective when a business wants to quickly capture market share and attract price-sensitive customers, e.g. many new perfumes launch using penetration pricing Once they have enough customers, the business will start to raise the price

Answer 15

Where the business sets prices so low that it drives its competitors out of the market This strategy is illegal in many countries as it is considered anti-competitive and harms customers by reducing choice in the market

Answer 16

Where the business sets its prices based on its competitors’ prices This is effective when a business is in a highly competitive market and wants to maintain its market share The business must continually monitor its competitors' prices and adjust its prices accordingly to remain competitive

Answer 17

Talk into account customer’s emotions, beliefs, and attitudes towards the product/service E.g. a business may set its prices at £9.99 instead of £10 as customers perceive the former as a better value

Answer 18

The number of USPs the business has as with many USPs this creates a high level of differentiation meaning the business can charge higher prices The price elasticity of demand e.g. if a business is in a highly competitive market with many substitutes, lowering prices will increase revenue The level of competition The strength of the brand The stage the product is in the product lifecycle e.g. in introduction stage prices set lower to attract customers, in growth stage prices can increase as demand increase and in maturity prices may need to be lowered again The costs and the need to make profit

Answer 19

Convenience 24/7 accessibility

Answer 20

Through the use of dynamic pricing This is where retailers can adjust prices in real-time based on factors such as demand and competition Prices are higher when supply is lower and prices are lower when supply is higher Retailers may also offer different prices for online purchases compared to in-store purchases to incentivise customers to shop online, which may mean the retailer requires fewer physical stores As This will reduce the retailer's costs

Answer 21

To remain competitive in an online marketplace Pricing has changed to reflect the rise in price comparison through the use of price-matching policies Retailers now offer to match the prices of their competitors to prevent customers from switching to a competitor with a lower price Retailers may also use pricing algorithms to monitor the prices of their competitors and adjust their prices automatically

Answer 22

The various ways through which goods/services move from the manufacturer to the end customer

Answer 23

Four stage distribution Three stage distribution Two stage distribution

Answer 24

A channel that consists of four stages: - producer - wholesaler - retailer - consumer This channel is commonly used for products such as groceries, clothing, and electronics E.g. the coca-cola company produces the soft drink and then sells it to a wholesaler, who in turn sells it to the retailer The retailer then sells it to the end customer

Answer 25

The three stage distribution channel eliminates the wholesaler stage, with the producer selling directly to the retailer This channel is often used for products with high demand or where the cost of distribution is high Often used for products with high profit margins, where the manufacturer can afford to sell directly to the retailer and still make a profit Eg Toshiba produces laptops and sells them directly to retailers like Currys, who then sell them to the end customer

Answer 26

The two stage distribution channel eliminates both the wholesaler and retailer stages, with the manufacturer selling directly to the end consumer. This channel is commonly used for products that are sold online or through direct sales channels E.g. RyanAir sells its service (passenger tickets) directly to the end customer on their website

Answer 27

Social trends such as the growth of e-commerce and the shift from product-based businesses to service-based businesses By understanding these trends, businesses can adjust their distribution strategies to better meet the needs of their customers and stay competitive in the marketplace

Answer 28

E commerce is online distribution, it can become increasingly popular due to the convenience and accessibility it offers to consumers Many businesses now use drop-shipping, which allows them to sell products without holding stock Once the business has sold the products, they are shipped directly from the producer to the customer This reduces the cost and complexity of distribution, making it easier for businesses to sell online E.g. Amazon, they provide businesses with the infrastructure and online marketplace which allows them to reach a wider audience and increase sales without having to invest in their distribution infrastructure Many businesses now generate the bulk of their sales selling on Amazon

Answer 29

Consumers increasingly value experiences over material possessions and this shift has impacted distribution, as the delivery of services is often quite different from the delivery of physical products Distribution for service-based businesses may involve delivering services to customers directly, such as through a mobile app or website This requires a different set of distribution capabilities than traditional product-based distribution E.g. Uber delivers a taxi service through a mobile app The distribution involves matching drivers with customers in real-time The service is distributed directly to the end consumer without the need for wholesalers or retailers With no need for wholesalers or retailers, business costs reduce and profitability may increase

Answer 30

The different stages a product goes through from its conception to its eventual decline in sales

Answer 31

5 Development Introduction Growth Maturity Decline

Answer 32

The focus is on designing and developing the product The business usually incurs high costs for research and development, market research, and product testing Cash flow is usually negative during this stage, as the company is investing heavily in the product without generating any revenue The marketing strategy during this stage is focused on creating awareness and generating interest in the product

Answer 33

The stage begins when the product is launched Characterised by slow sales growth as the product is still new and unknown to most consumers Cash flow is usually negative as the business usually incurs high costs for promotion, advertising and distribution Marketing efforts are focused on creating awareness and generating interest in the product

Answer 34

The product enters this stage when sales begin to increase rapidly The business focus shifts to building market share and increasing production to meet the growing demand Cash flow usually turns positive during this stage as sales revenue increases and costs are spread out over a larger volume of production The marketing strategy is to differentiate the product from its competitors and build brand loyalty

Answer 35

Characterised by slowing sales growth as the product reaches its peak in terms of market penetration Cash flow is usually positive during this stage as sales revenue continues to come in and costs are reduced through economies of scale and efficient production processes The marketing strategy aims to maintain market share and increase profitability by cutting costs and finding new markets

Answer 36

Starts when sales begin to decline as the product becomes obsolete or is replaced by newer products The business focus shifts to managing the product's decline and reducing costs Cash flow usually turns negative as sales revenue declines and costs associated with the product's decline increase The marketing strategy may involve discontinuing the product, reducing its price to clear inventory, or finding new uses for the product

Answer 37

Product-related extension strategies Promotion-related extension strategies By making product and promotion-related changes businesses can continue to appeal to customers and extend the life of their products

Answer 38

Involves changing or modifying the product to make it more appealing to customers and extend its life cycle and can be achieved in one of three ways: Product improvements e.g. Samsung releases new versions of its galaxy smartphone every year with upgraded features and improvements to the previous model Line extensions e.g. Coca-Cola introduced Diet Coke and Coke Zero as line extensions of its original Coca-Cola Repositioning e.g. when IBM's personal computer division started losing market share to other brands, it repositioned its products as high-end business machines and focused on the enterprise market

Answer 39

Involves changing the marketing and promotion of the product to extend its life cycle and could include one or more of the following changes: Changes to advertising e.g Kellogg's continues to recreate adverts for its Corn Flakes cereal which has been around since 1906 Price promotions e.g. Cyber Monday occurs on the first Monday after Thanksgiving in the USA and electronic firms discount prices significantly to boost sales of their products Sales promotions e.g. many coffee shops offer a loyalty program where customers can earn a free drink for every six consumed

Answer 40

The Boston Matrix is a tool used by businesses to analyse their product portfolio and make strategic decisions about each product The matrix classifies products into four categories based on their market share and the market growth rate Cash Cow Problem Child/Question Mark Star Dog

Answer 41

Cash cows are products with a high market share in a mature market (the entire market is no longer growing) They generate significant positive cash flow but have low growth potential The business invests minimal resources in cash cows as they are seen as stable sources of income Marketing efforts focus on maintaining their market share and profitability Cash cows are valuable assets and can be used to fund the development of new products

Answer 42

question mark products have a low market share in a high-growth market These products have the potential to become stars if the company invests in their development There is often a negative cash flow as businesses usually invest in problem child products to increase their market share and turn them into stars If the investment does not result in growing the business may discontinue the product Marketing efforts focus on increasing their market share and brand recognition

Answer 43

Star products have a high market share in a high-growth market The company typically invests in stars to maintain or increase their market share They generate significant positive cash flow and have the potential for continued growth Marketing efforts focus on building brand recognition, increasing market share, and maintaining profitability Stars are valuable assets and the business should focus on maximising their potential

Answer 44

Dog products have a low market share in a low-growth market They generate little revenue for the company and have no growth potential Businesses often move away (divest) from these to focus on more profitable products Marketing efforts for dog products are minimal or zero

Answer 45

Mass markets are characterised by large numbers of customers who have similar needs and wants e.g. retail clothing Mass markets focus on building brand awareness and appealing to a broad audience Advertising campaigns are usually designed to reach as many people as possible and use mass media such as TV, radio, and print ads The messages are often simple and the goal is to create a strong brand identity that resonates with a large segment of the population

Answer 46

Niche markets are characterised by smaller groups of customers with specific needs and want. e.g organic food stores, luxury car dealerships Marketing strategies focus on targeting a specific segment of the population and building relationships with them Advertising campaigns are usually more targeted and may use social media to reach potential customers The messages are often more detailed and often include technical information that is relevant to the specific needs of the target market

Answer 47

B2B marketing focuses on selling products to other businesses e.g. software companies selling to other businesses; manufacturers selling parts to other manufacturers In B2B marketing, the emphasis is on building relationships with other businesses and demonstrating how your product can help them be more successful Advertising campaigns may include case studies that demonstrate the value of your product/service The messages are often more technical and may focus on features and benefits that are relevant to other businesses

Answer 48

B2C marketing focuses on selling products/services directly to consumers e.g clothing retailers In B2C marketing the emphasis is on building brand loyalty and creating a positive customer experience Advertising campaigns may include social media ads or influencer marketing campaigns that appeal to the emotions of consumers The messages are often more emotional and may focus on the lifestyle benefits of using the product/service

Answer 49

Customer service Offering loyalty cards Saver schemes

Answer 50

Because When customers have a positive customer service experience, they are more likely to return and recommend the business to others E.g. Zappos is an online retailer that is well known for its exceptional customer service They offer free shipping and returns Their customer service representatives are available 24/7

Answer 51

Because loyalty cards are A popular way for businesses to encourage repeat customers These cards typically offer rewards or discounts for frequent purchases E.g. Sephora has a loyalty program called "Beauty Insider." Members earn points for every purchase they make They can redeem those points for beauty products or experiences

Answer 52

These schemes typically offer discounts or special pricing for customers who save money with them This helps customers gradually save up some money that can be used at periods when food bills are usually higher e.g Christmas E.g. Sainsbury's offers a Christmas saving scheme Their discounts are then usually between 2% and 6%

1.3 Marketing Mix + Strategy Flashcards

(76 cards)