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Business Management > 4.5/ 4.6 The seven P's > Flashcards

4.5/ 4.6 The seven P's Flashcards

1
Q

The 7 Ps

A
  • product
  • price
  • promotion
  • place
  • physical evidence
  • people
  • process
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2
Q

Product life cycle

A

The typical process that products go through from their initial design and launch to their decline and eventual withdrawal.

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3
Q

Stages of product life cycle

A
  • Introduction
  • Growth
  • Maturity or saturation
  • Decline
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4
Q

Extension strategies (definition)

A

Marketing plans that extend the maturity stage of the product before a brand new one is needed.

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5
Q

Extension strategies (examples)

A
  • price reduction
  • redesigning
  • repackaging
  • new markets
  • brand extension
  • product differentiation
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6
Q

Boston Consulting Group (BCG) matrix

A

A method of analysing the product portfolio of a business in terms of market share and market growth.

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7
Q

Product portfolio

A

The range of products or strategic business units owned and developed by an organization at any one point in time.

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8
Q

Stars (BCG matrix)

A

Products that operate in high growth markets and have high market share, are successful products that tend to generate high amounts of cash.

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9
Q

Question marks/ problem child (BCG matrix)

A

Products that operate in a high market growth sector, but have low market share, this may suggest inferior marketing or product quality.

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10
Q

Cash cows (BCG matrix)

A

Products with high market share operating in a low-growth market, very well established products.

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11
Q

Dogs (BCG matrix)

A

Products with low market share operating in a low growth market, do not generate much cash as the market tends to be stagnant or declining.

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12
Q

Branding

A

A form of differentiating a firm’s products from those of its competitors.

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13
Q

Brand

A

An identifying symbol, name, image or trademark that distinguishes a product from its competitors.

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14
Q

Brand awareness

A

Extent to which a brand is recognised by potential customers and is correctly associated with a particular product.

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15
Q

Brand development

A

Measures the infiltration of a product’s sales .

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16
Q

Brand loyalty

A

The faithfulness of consumers to a particular brand as shown by their repeat purchases irrespective of the marketing pressure from competing brands.

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17
Q

Brand value/ equity

A

The premium that a brand has because customers are willing to pay more for it than they would for a non-branded generic product.

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18
Q

The importance of branding

A
  • promotes instant recognition of the company and product
  • helps differentiate the company and its products from rivals
  • customers know what to expect from the company and products
  • an emotional attachment can develop between the brand and customers
  • increases the value of the business above the value of its physical assets
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19
Q

The importance of packaging

A
  • protection or function
  • attracting customers
  • promotion and information
  • differentiation and brand support
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20
Q

Price (the marketing mix)

A

The amount paid by a customer to purchase a good or service.

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21
Q

Factors determining price

A
  • costs of production
  • competitive conditions in the market
  • competitors’ prices
  • marketing objectives
  • price elasticity of demand
  • whether it is a new or an existing product
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22
Q

Pricing strategies

A
  • Cost-plus (mark-up)
  • Penetration
  • Skimming
  • Psychological
  • Loss leader
  • Price discrimination
  • Price leadership
  • Predatory
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23
Q

Cost-plus (mark-up) (pricing strategies)

A

Adding a fixed mark-up for profit to the unit price of a product.

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24
Q

Penetration (pricing strategies)

A

Setting a relatively low price often supported by strong promotion in order to achieve a high volume of sales.

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25
Q

Skimming (pricing strategies)

A

Setting a high price for a new product when a firm has a unique or highly differentiated product with low price elasticity of demand.

26
Q

Psychological (pricing strategies)

A

Setting prices that take account of customers’ perception of value of the product.

27
Q

Loss leader (pricing strategies)

A

Product sold at a very low price to encourage consumers to buy other products.

28
Q

Price discrimination (price strategies)

A

Occurs when a business sells the same product to different consumers at different prices.

29
Q

Price leadership (price strategies)

A

Exists when one business sets a price for its products and other firms in the market set the same or similar prices.

30
Q

Predatory (price strategies)

A

Deliberately undercutting competitors’ prices in order to try to force them out of the market.

31
Q

Promotion (the marketing mix)

A

The use of advertising, sales promotion, personal selling, direct mail, trade fairs, sponsorship and public relations to inform consumers and persuade them to buy.

32
Q

Key objectives of promotion

A
  • to inform
  • to persuade
  • to remind
33
Q

Above-the-line promotion

A

Any form of paid-for promotional method through independent mass media sources to promote a business, its brands or its products.

34
Q

Below-the-line promotion

A

Promotion over which the firm has direct control. It includes direct promotion like direct mailing, exhibitions and trade fairs and sales promotions.

35
Q

Promotion mix

A

The combination of promotional techniques that a firm uses to communicate the benefits of its products to customers.

36
Q

Sales promotion (example of below-the-line promotion)

A

Incentives such as special offers or special deals directed at consumers or retailers to achieve short-term sales increases and repeat purchases by consumers.

37
Q

Internet marketing

A

Refers to advertising and marketing activities that use the internet, email and mobile communications to encourage direct sales via electronic commerce.

38
Q

Social media marketing

A

The process of gaining website traffic or attention through social media sites and social networks.

39
Q

Viral marketing

A

The use of social media sites or text messages to increase brand awareness or sell products.

40
Q

Advantages of technology in promotional activities:

A
  • speed
  • availability
  • cost-effective
  • wide reach
41
Q

Disadvantages of technology in promotional activities:

A
  • lack of control
  • access
  • attention span
42
Q

Guerrilla marketing

A

An unconventional way of performing marketing activities on a very low budget.

43
Q

Place (the marketing mix)

A

Refers to the distribution of products.

44
Q

Chanel of distribution

A

The chain of intermediaries a product passes through from producer to final consumer.

45
Q

Methods of distribution

A
  • a zero-level channel
  • a one-level channel
  • a two-level channel
46
Q

A zero-level channel (methods of distribution)

A

Does not have any intermediaries, the producer sells directly to the consumer.

47
Q

A one-level channel (methods of distribution)

A

Has one intermediary, such as retailers, agents or distributors being used to sell products to consumers.

48
Q

A two-level channel (methods of distribution)

A

Has two intermediaries, such as the use of wholesalers and retailers to get products to consumers.

49
Q

Wholesalers

A

Businesses that purchase large quantities of products from a manufacturer and then separate or ‘break’ the bulk-purchases into smaller units for resale, mainly to retailers.

50
Q

Distributors

A

Independent businesses that act as intermediaries by specialising in the trade of products made by certain manufacturers.

51
Q

Agents (or brokers)

A

Negotiators who help to sell a vendor’s products.

52
Q

Retailers

A

Sellers of products to the general public (i.e. consumers) that operate in outlets.

53
Q

Types of retailers

A
  • independent retailers
  • multiple retailers (chain retailers)
  • supermarkets
  • hypermarkets
  • department stores
54
Q

Independent retailers

A

Small local vendors often owned by a sole proprietor.

55
Q

Multiple retailers (chain retailers)

A

Retailers that have numerous outlets.

56
Q

Hypermarkets (retailers)

A

Huge outlets that stock a broad range of products such as foodstuffs and consumer durables.

57
Q

Department stores (retailers)

A

Retail outlets that sell a large range of products.

58
Q

Process (the marketing mix)

A

The ways in which a service is provided or delivered.

59
Q

Processes in service marketing include:

A
  • waiting time
  • payment methods
  • speed and quality of delivery
  • additional services, e.g. after sales
60
Q

Physical evidence (the marketing mix)

A

The tangible aspects of a service, the physical environment influences the satisfaction of consumers receiving a service, physical evidence is an essential ingredient of the service mix as consumers’ perceptions of the service is influenced by their perception of the delivery environment.

61
Q

People (the marketing mix)

A

People are the most important element of any service experience and can have a profound positive or negative effect on customer satisfaction. The reputation of a firm’s brand rests in the hands of its employees.

Services are normally produced and consumed at the same moment and aspects of the customer experience are altered to meet individual needs.

Customers buy services from people they like, so the attitude, skills, behaviour and appearance of staff are crucial to satisfaction and service quality. The training of staff is central to successful service delivery.

Business Management (37 decks)

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