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Business Y12 End Of Years > 3.3 Marketing Management > Flashcards

3.3 Marketing Management Flashcards

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1
Q

MARKETING OBJECTIVES

A

are the measurable targets that a business intends to achieve as a result of its marketing activities.

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2
Q

MARKET SHARE

SALES VOLUME =

SALES VALUE =

SALES GROWTH =

A

The number of products sold

The revenue from products sold

The percentage increase in sales volume or sales value

The percentage of sales in a particular market for which one business is responsible

The degree of attachment that consumers have for a particular product

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3
Q

Markets

A

MARKETS are defined as ‘the meeting place between customers and suppliers’.
They can be local, national or international.
They can also be either physical or electronic.

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4
Q

MARKET SIZE

A

means the measurement of all the sales by all the sellers within a particular market. It can be measured by volume (the number of goods sold)

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5
Q

Market size can be calculated by:

A

Sales for one business ÷ the market share of that business expressed as a decimal

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6
Q

MARKET GROWTH

A

means the percentage increase in the size of a market, usually calculated over a period of one year.

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7
Q

Market growth is calculated by:

A

Increase in market size ÷ Market size in the earlier of the two years x 100

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8
Q

MARKET SHARE

A

means the percentage of total sales within a particular market for which one business is responsible.

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9
Q

Market share is calculated by:

A

Sales for one business ÷ Sales for the whole market (or industry) x 100

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10
Q

The sales of ONE business may be calculated by:

A

The Market share of that business x Sales of the whole market (or industry)

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11
Q

MARKETING RESEARCH

A

means gathering data to discover the needs and wants of current and potential customers.

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12
Q

PRIMARY RESEARCH (also called FIELD RESEARCH)

A

means collecting new information that is tailor-made to the business’ needs. Methods include surveys (using a questionnaire), observation, focus groups and test marketing.

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13
Q

SECONDARY RESEARCH (also called DESK RESEARCH)

A

means using information that already exists. This includes sales figures, information about competitors, Government publications, market information reports, economic data, population statistics, etc.

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14
Q

QUANTITATIVE RESEARCH

A

collects data that can be summarised numerically:
e.g. surveys using closed questions with multiple-choice answers.

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15
Q

QUALITATIVE RESEARCH

A

collects data that cannot be summarised numerically.
It aims to discover people’s real thought processes and reasons behind their purchasing decisions: e.g. focus groups using open questions that provide detailed answers.

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16
Q

SAMPLE

A

means the group of people that are interviewed, whose views are intended to be representative of the whole population of potential customers.

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17
Q

RANDOM SAMPLE

A

means that each member of the population has an equal chance of being selected (e.g. based on the electoral roll)

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18
Q

STRATIFIED SAMPLE

A

means that you divide the population into different groups and selects people from each group in order to be representative of the whole population

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19
Q

QUOTA SAMPLE

A

means a target number of respondents in each section of the population is needed to meet research needs.

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20
Q

CONFIDENCE LEVELS

A

Businesses aim for ‘95% confidence’ from survey results.

This means that the size of the sample and the strength of the results mean that the results will be accurate 95% of the time.

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21
Q

Confidence intervals are stated numerically. They are stated

A

‘± a certain number’.

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22
Q

EXTRAPOLATION

A

means forecasting sales in the near future based on what has happened in the recent past. We assume that recent trends will continue in the foreseeable future.

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23
Q

PRICE ELASTICITY OF DEMAND

A

means the responsiveness of demand to a change in the selling price.

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24
Q

Is PED negative or positive

A

Negative always

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25
The formula for PED
The formula for PED = % Change in demand ÷ % Change in price
26
Talk about PED and the number involved
If PED is between 0 and -1 (e.g. – 0.5), demand is INELASTIC and an increase in price causes an increase in revenue. If PED is lower than -1 (e.g. -2), demand is ELASTIC and a decrease in price causes an increase in revenue. However a decrease in price may not cause an increase in profit.
27
INCOME ELASTICITY OF DEMAND.
means the responsiveness of demand to a change in consumers’ levels of income
28
The formula for IED =
% Change in demand ÷ % Change in income
29
Talk about IED
IED is POSITIVE for NORMAL GOODS. This means that demand increases when there is an increase in consumers’ income. IED is NEGATIVE for INFERIOR GOODS. This means that demand decreases when there is an increase in consumers’ income (and vice versa).
30
USING DATA IN MARKETING DECISION MAKING AND PLANNING
It helps businesses understand their customers and the market as a whole (e.g. identify relevant market segments and customers’ needs & wants) • It helps identify gaps in the market or other opportunities • It helps make better decisions about all aspects of the marketing mix (products sold, prices charged, promotional methods, placement and any other factors that are important to customers) • Sales forecasting (e.g. from correlation and/or extrapolation)
31
MARKET SEGMENTS
are groups of consumers with similar needs and wants.
32
SEGMENTATION
means identifying which segments exist within a market.
33
TARGETING
means choosing which segment(s) at which to aim your products.
34
Methods of segmentation can include:
Demographic segmentation Based on age, gender, marital status or family size Geographic segmentation Based on where customers are based ; region, country, urban or rural Behavioural segmentation Based on consumers’ life-style, hobbies & interests and buying habits Income segmentation Based on how much people earn and/or socio-economic groups
35
NICHE MARKETING
means aiming a product at a small segment of a larger market.
36
Benefits of niche marketing
High sales due to lack of competition Can charge high prices Can establish customer loyalty due to ‘first mover advantage’
37
Drawbacks of niche marketing
Will eventually attract competition from larger firms Higher average costs because of the low volume of sales There may not be enough customers to generate sufficient profits
38
MASS MARKETING
means devising products with wide appeal and promoting them to all types of customers.
39
Benefits of mass marketing
Potentially high sales due to the larger number of potential customer Lower average costs can allow lower prices to be charged
40
Drawbacks of mass marketing
Greater amount of competition Harder to establish a USP
41
ADVANTAGES OF TARGETING SPECIFIC MARKET SEGMENTS
You can make better decisions about: Products that meet your customers’ needs and wants. Prices that they are willing to pay Promotional methods (e.g. advertising media and content of advertisements) Places where your products are sold Primary research so that it is aimed at suitable people
42
DISADVANTAGES OF TARGETING SPECIFIC MARKET SEGMENTS
They might be inaccurate, so you could make incorrect decisions about products, prices, promotional methods, etc. You might limit your level of sales by not appealing to a larger market.
43
MULTIPLE SEGMENTATION
means dividing a market into segments and then developing different products for each segment
44
POSITIONING
means how businesses differentiate themselves from their competitors It can be based on product range, prices, customer service or any other relevant factors.
45
MARKET MAPPING
means: identifying two key features of products or businesses in a market (e.g. price, quality or other aspects of the products or customers) placing each product or business in a grid against those two features.
46
MARKETING MIX
means the combination of tactics used by a business to sell enough of its products in order to achieve its marketing objectives
47
What are the 7 p’s
product, price, promotion, place, people, process and physical evidence.
48
PRODUCT
means the goods and services that are provided by a business.
49
Goods
GOODS are physical objects that are sold by a business.
50
Services
SERVICES are activities that a business carries out for its customers.
51
Products may be categorised as
INDUSTRIAL or CONSUMER.
52
INDUSTRIAL PRODUCTS are sold
to other businesses. This is also called ‘B2B’ (business to business)
53
CONSUMER PRODUCTS are sold
to the general public. This is also called ‘B2C’ (business to consumers
54
PRODUCT PORTFOLIO
means the combination of products supplied by a business.
55
BOSTON MATRIX
is a way of analysing the product portfolio of a business in terms of their market share and the rate of growth of their market.
56
Name the 4 elements and explain them Boston matrix
Star High market share in a high growth market Cash cow High market share in a low growth market Problem child (or ‘Question mark’) Low market share in a high growth market Dog Low market share in a low growth market
57
PRODUCT LIFE CYCLE
shows the sales of a product over time, usually through the following stages: Development, Introduction (or Launch), Growth, Maturity and Decline.
58
EXTENSION STRATEGIES
are ways of extending with life cycle of a product. They include changing the product and/or the packaging, a new advertising campaign, special promotional offers and reducing the price
59
PENETRATION PRICING
means charging a low price for a new product to secure a place in the market
60
Price SKIMMING means
charging a high price for a new product whilst there is no competition
61
DYNAMIC PRICING (also called real time pricing)
means setting highly flexible prices for products based on current market demands (e.g. supply, demand, competitors’ prices).
62
Cost plus pricing =
Adding a set mark-up to the purchase price of goods
63
Price discrimination
= Charging different prices to different market segments
64
Loss leader
Offering an extremely low price for some products on the basis that customers will also buy other products at their normal prices
65
Destroyer pricing =
Charging extremely low prices in order to force competitors out of the market.
66
Psychological pricing =
Charging prices just below significant figures (£9.99, £19.99)
67
PROMOTIONAL MIX
means the combination of factors used to increase customer awareness and persuade them to buy the products: advertising, digital marketing, branding and other promotional methods such as PR, merchandising, direct selling and sales promotions such as competitions, special offers,
68
Above the line promotion’: ‘Below the line promotion’:
means using advertising media E.g television,radio,internet means all other methods of promotion. E.g sales promotion,discount,coupons
69
BRANDING
means creating an identity for a business and its products to differentiate it from the others in the market. A strong brand can lead to higher levels of sales and the ability to charge higher prices.
70
DIGITAL MARKETING
means using social media and search engines.
71
PLACE
means where the final consumer can purchase a product.
72
Manufacturer or Producer
is a business that makes the products.
73
Wholesaler
is a business that buys the products in very large quantities from producers and sells in smaller quantities to retailers.
74
Retailer
is a business that sells the products to the consumers.
75
Consumers
are the people or businesses that buy the products for their own use.
76
For a RETAILER, ‘place’ means:
the location of shops whether consumers can buy over the phone or via the Internet.
77
For a MANUFACTURER, ‘place’ means:
finding the right outlets to sell its products considering the distribution channels.
78
DISTRIBUTION CHANNELS
are the stages of ownership that take place as a product moves from the manufacturer to the consumer.
79
MULTI-CHANNEL DISTRIBUTION
means providing a number of ways which the final consumer is able to buy a product.
80
E-COMMERCE
means the buying or selling of products online. It directly affects promotion and place in the marketing mix. Also, it indirectly affects other aspects of the marketing mix.
81
PEOPLE
means the skills and attitudes of the employees who deal with the customers.
82
PROCESS
means the business systems that affect the quality of service (e.g. queuing systems, or how queries & complaints are handled).
83
PHYSICAL EVIDENCE means:
● the layout, contents and appearance of stores ● the content and appearance of brochures, letterheads, and websites

Business Y12 End Of Years (6 decks)

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