2.2 - Making Marketing Decisions

Question 1

What are the 3 elements in the design mix

Answer 1

Function
Aesthetic
Cost

Question 2

What are the 4 phases of the product life cycle

Answer 2

Introduction - product is launched
Growth - Sales increase rapidly as awareness increases
Maturity - Sales peak during this time
Decline - loses popularity and customers look for alternatives

Question 3

What factors affect how long a product lasts (2)

Answer 3

How dynamic the market is - the rate that it is changing

How strong the brand image behind the product is

Question 4

What are extension strategies

Answer 4

A way of extending the life cycle of a product

Question 5

What are some extension strategies

Answer 5

• Product differentiation - Stands out from competitors and adds a USP
• Reducing the Price of the product
• Rebranding the product - to appeal to customers again
• Repositioning the product - eg trying a different sized version of the product/ Updating it
• Increasing market activity - eg running new ad campaigns and promotions

Question 6

What do businesses need to think about when deciding on a price

Answer 6

• The cost of making the product
• The quality of the product
• The brand image of the product
• The supply and demand of the product

Question 7

What are the 2 method of pricing a business must choose from

Answer 7

Pricing low - achieves a high volume of sales but a low profit margin typically used for generic products with no USP

Pricing high - Low volume of sales but high profit margin used for products with a strong USP

Question 8

What are the 4 factors that may lead to a change in price

Answer 8

• Changes in technology
• Number of competitors
• Market segments
• Where the product is in its life cycle

Question 9

What do businesses use promotion for (3)

Answer 9

• inform consumers of a new product or service
• persuade consumers to buy a product or service
• remind consumers about the benefits of a product or service

Question 10

What is an advertisement

Answer 10

a paid-for message designed to influence consumer purchases

Question 11

What is a Sponsorship

Answer 11

They provide financial support to an event, person or organisation, either through free products or services, or through a financial payment.

In return, the business, product or service is prominently displayed.

Question 12

What are product trials

Answer 12

They designed to encourage consumers to try a product either for free or at a reduced cost.

Question 13

What are special offers

Answer 13

A type of sales promotion. They offer incentives to persuade consumers to make a purchase.

Question 14

What is Branding

Answer 14

A brand image can be used as promotion

When a new product is launched under an established brand name, consumers may be more likely to purchase it because of their knowledge of the existing brand.

Question 15

define promotional strategy

Answer 15

Planned promotional activities designed to increase awareness of a product or service by appealing to a target audience.

Question 16

define viral marketing

Answer 16

Promotional activity that encourages consumers to share content between themselves on the internet.

Question 17

What is targeted online advertising

Answer 17

Website owners track the online activity of consumers using cookies. They use this to build a profile of consumer interests and target ads towards them based on this

Question 18

define channels of distribution

Answer 18

the different ways of moving goods from producers to customers

Question 19

What are 3 common channels of distribution

Answer 19

Producers
Retailers
e-tailers

Question 20

What is a direct channel of distribution

Answer 20

Only involves the producer and the customer

Question 21

What is an indirect channel of distribution

Answer 21

It introduces an intermediary ( a link) who makes it easier to distribute products and more convenient for customers to buy these products. however they take some profit

Question 22

What is the advantages(2) and disadvantages(1) of a retailer

Answer 22

customers are able to see and feel the quality of the products that they are interested in

Retailers that sell a particular type of product may also be able to offer specialist advice

They require premises which can be expensive

Question 23

What are the advantages(4) of being an e-tailer

Answer 23

they can offer a wide range of products as they are not limited by the size of a shop

they may allow small producers to sell through their website for a fee

their prices are often lower, as they do not have to pay for a physical shop

customers can shop whenever and wherever they want, as e-tailers are open 24 hours a day, 7 days a week

Question 24

What are the disadvantages(4) of being an e-tailer

Answer 24

customers need to have internet access
customers cannot pay by cash
goods need to be delivered, so customers must be willing to wait
items cannot be seen in person before purchasing them

Question 25

Why does each element of the marketing mix need to be balanced

Answer 25

as they all affect each other