Marketing Mix- Price And Product Flashcards
Brand
The identifying symbol, name or trademark that distinguishes a product from its competitors
New product development (NPD)
The design, creation and marketing of new goods and services
Marketing mix
The four key decisions on product, price, place and promotion that must to be taken fro effective marketing
Importance of new. product development
-Changing consumer tastes and preferences
-Increasing competition
-Technological advancement
-New opportunities for growth
-Risk diversification
-Improved brand image
-Use of excess capacity
Benefits of effective USP
-Promotion that focuses on differentiating
-Opportunities to charge higher prices due to unique features
-Free publicity from media reporting on the USP of the product
-Higher sales compared to undifferentiated products
Unique selling point (USP)
The special feature of a product that makes it different from its competitior’s products
Product positioning
Consumers views of a product or service compared to its competitors
Product portfolio analysis
Analysing the range of existing products of a business to help allocate resources effectively between them
Product life cycle
The pattern of sales for a product from launch to withdrawal from a market
-Introduction
-Growth
-Maturity or Saturation
-Decline
Extension strategy
A marketing plan to extend the maturity stage of the product before a new one is launched
Boston matrix
A method of analysing the product portfolio of a business I terms of market share and market growth
Cash cow- low market growth, high market share.
Maturity.
Star- high market growth, high market share.
Growth.
Question mark- high market growth, low market share.
Introduction
Dog- low market growth, low market share.
Decline.
Action taken on Boston matrix products
-Building- supporting question mark products w additional advertising or further distribution outlets
-Holding- continuing support for star products so that they maintain their good market position
-Milking- take positive cash flow from established products and investing it in other products
-Divesting- identifying the worst performing dogs and stopping the production and supply of these products
Limitations of using Boston matrix
-Does not tell the manager what will happen to the product next
-Only a planning tool and is criticised to be too simple
-Assumes higher rate of profits are directly related to high market shares
Main determinants of pricing
-Costs of production
-Competitive conditions in the market
-Competitors prices
-Business and marketing objectives
-Price elasticity of demand
-Whether it is new or existing product
Cost-plus markup or mark-up pricing
Adding a fixed markup for a profit to the unit cost of buying in a product
