Marketing 4.4-4.5 Flashcards
(103 cards)
1
Q
Why do organisations carry out market research? (6)
A
- identifying consumer needs, wants
- understanding consumer purchasing behaviour
- identifying potential changes in the market
- testing products, seeing what consumers like and dislike
- evaluating existing marketing efforts in attracting consumers
- investigating new possibilities
2
Q
Why do social enterprises carry out market research?
A
identifying which needs they should address or how well their activities meet the need
3
Q
For which type of business is marketing research most important?
A
market-oriented
likely to base their strategies on this
4
Q
What are the 2 types of market research?
A
secondary and primary
5
Q
What is + examples of primary market research?
A
- involves creating new info
- answering a specific research question
- surveys
- interviews
- focus groups
- observations
helps to find out about consumers tastes, why they buy, and if they like the product
6
Q
What is secondary market research + examples?
A
research using information gathered by others
to learn general info about its target market and the external environment
- market analysis
- academic journals
- govt publications
- media articles
- online content
7
Q
What do surveys do?
A
collect data from large numbers relatively quickly
better for quantitative data
8
Q
What do interviews do?
A
researchers ask many questions
qualitative and detailed data
may need financial incentive
9
Q
What do focus groups do?
A
interview conducted with a small group of individuals
usually similar characteristics
may need financial reward
10
Q
What is observation as a form of primary market research?
A
allow natural reactions of customers to be studied
eg security cameras, websites
11
Q
Is primary research always done by the business?
A
no, it can be outsourced to professional researchers
12
Q
What is a market analysis?
A
a cheaper alternative to paying for a market research agency
purchasing a market analysis report already published
13
Q
What are academic journals?
A
contain articles on new research and academic theory
good for info on contemporary issues
14
Q
What are government publications?
A
governments publish data covering topics like population statistics or economic conditions
15
Q
What are media articles?
A
published in both printed and electronic forms
provide current local and/or national information
16
Q
What are some examples of other online content that can be 2ary research?
A
- social media/analytics
- company websites
- e-commerce sales data
- investors relations pages
17
Q
What determines what makes a good source of information?
A
- currency
- relevance
- authority
- accuracy
- purpose
18
Q
Benefits of primary research
A
- direct information about tastes
- info about reasons for purchase
- unique information, competitive advantage
19
Q
Limitations of primary research
A
- expensive and time consuming
- staff may need training
- difficult to construct effective questions and experiments
20
Q
Benefits of secondary research
A
- cheaper than primary
- broader contextual information
- often already available
21
Q
Limitations of secondary research
A
- business to rely on other’s research methods
- information may not exist
- existing information may not be fit (diff issue, subject, target market…)
22
Q
What is quantitative research?
A
collecting numerical data or information that can be counted
23
Q
What is qualitative research?
A
collecting non-numerical data like opinions
24
Q
What is a key difference between quantitative and qualitative research?
A
sample sizes
quantitative - small amount of info from a large number of people
qualitative - large amount of info from a small number of people
25
How does a business decide if they will use qualitative or quantitative data?
- financial and time constraints
- objectives of the research
- value quantity or quality more
26
What is a sample?
a subset of individuals from a given population used to make some estimation of the population as a whole
27
What is the population?
all customers of a specific product
28
What are the 2 main types of sampling methods?
probability - each subject has the same chance of being selected (only random sampling)
non-probability - not random
29
What are sampling methods?
methods used to choose a sample
30
3 main sampling methods
random, quota and convenience
31
What is random sampling?
a sampling method where everyone in the population has the same chance of being selected
most representative and least biased
probability
32
What is quota sampling?
involves dividing the population into subgroups based on a certain characteristic
sample taken from each subgroup based on convenience
non-probability
33
Advantages of each type of sampling
random - most representative and least biased
quota - faster and easier, cheaper than random sampling, takes population proportions into account
- simpler
34
Disadvantages of convenience sampling?
unlikely that it will represent the target population accurately unless large sample sizes are used
least representative
35
What is convenience sampling?
sample is made up of whichever people are willing to take part in the reasearch
36
What is a product?
the result of a production process where resources are used to create a good/service to satisfy a need or want
37
What is the product life cycle?
a model that helps businesses make decisions about a product's marketing mix
shows a product's typical trend in sales over time
38
What are the 5 stages of the product life cycle?
1. research and development
2. introduction
3. growth
4. maturity
5. decline
39
What is the R and D stage of the product life cycle?
- all activities before release of product
- no sales
- length of stage depends on industry
- focus on market research, product development and preparation of production
- maybe some promotion
40
What is the introduction stage of the product life cycle?
- product released to market
- initial sales are likely low, but growing
- money must be spent on marketing
- promotion focusing on USP
- focus on pricing strategies and distribution channels
41
What is the growth stage of the product life cycle?
- increases in product sales are accelerating (% change in sales is increasing)
42
What are ways for a business to continue the growth stage in the PLC?
- new target markets, adaptation of marketing mix
- different pricing strategies
- expansion of distribution channels
- promotional messages adapted
43
What is the maturity stage of the product life cycle?
- high and steady sales revenue
- sales still growing, perhaps slower rate
- market may be crowded/saturated/competitive
44
What are marketing objectives during the maturity phase in the PLC?
- building customer loyalty
- cutting marketing budgets, no longer attempting to increase sales
45
Why is the maturity stage good?
combination of high sales revenues and falling promotional costs lead to high profits
46
What is the decline stage of the product life cycle?
a period of falling sales and/or loss of market share
47
How is the profitability in the decline stage?
products may still be profitable, since marketing costs will be low along with sales
48
What can lead to the decline stage in the PLC?
- product lost USP due to competition
- outdated technology
- customers' needs have changes
49
What should a business do during the decline phase?
- reduce prices to target poorer customers
- shift distribution channels to discount retailers
50
In the PLC, when are products withdrawn from the market?
when revenues are lower than costs of production in the decline phase
51
What are extension strategies?
methods that businesses use to lengthen the maturity stage of the PLC
52
Why are extension strategies beneficial?
- cost effective way of extending sales
- easier and less costly than launching a new brand (customer loyalty, established distribution channel)
53
What are 5 extension strategies?
1. finding a new target market
2. redesigning packaging
3. updating product
4. price reduction
5. new promotional strategies
54
Explain what is and the pros and cons of finding a new target market as an extension strategy.
new group of consumers found if the product no longer meets needs of existing market
pro: sales can increase
cons: market research can be costly
55
Explain what are the pros and cons of redesigning packaging as an extension strategy.
pro: can have a big impact on customer demand
con: some customers may feel tricked by new packaging with the same product
56
Explain what is and the pros and cons of updating a product as an extension strategy.
adding new/diff features
pro: often quick and cheap
con: some loyal customers may not like it - risky
57
Explain the pros and cons of reducing the price as an extension strategy.
pro: new group of consumers can access, increase sales by preventing existing customers from switching to competing products
con: may damage brand image, lower quality
58
Explain what is and the pros and cons of finding new promotional strategies as an extension strategy.
encouraging people to use product more often or differently
pro: sales increase with small investment in promotion
con: customers may be tired of the product, difficult to change mindset
59
What is a brand?
the name and symbols that identify a product
first reaction/gut feeling to the business
60
What is branding?
what creates the brand
61
What is brand awareness?
how do customers know the brand exists, and is it the first thing they remember when thinking about the market?
how recognizable is the brand?
62
What is brand development?
all actions (related to 7ps) to increase brand awareness, loyalty and value and creating a strong brand
63
What is brand loyalty?
a customer's willingness to buy from the same brand again
64
What are the 2 definitions of brand value?
1 - value of intellectual property associated with the brand when selling
2 - the premium that customers are willing to pay for a brand's product
65
What does packaging need to do to be efficient?
- protect the product
- communicate information about the product
- promote the product and communicates its USP
- product easy to use
66
What is cost-plus/markup pricing?
determining the price based on your costs and how much you want to profit
67
What are advantages/disadvantages of cost-plus (markup) pricing?
straightforward
profit will be achieved
inward facing
does not account for competition or customer's ability to pay
68
What is penetration pricing?
when businesses set an initial low price to encourage consumers (short term) to establish loyalty
then, when loyalty is established, they raise the prices so that normal profit margins can be achieved
69
What are advantages/disadvantages of penetration pricing?
And for what is it appropriate?
appropriate for products that will be purchased repeatedly
business may secure a large market share early on
customer loyalty established
may be low profit margins
increase in price can make customers unhappy
70
What is the loss leader pricing?
attracting customers to buy products by selling another one below production costs
71
For which businesses is loss leader pricing appropriate?
large businesses that can afford to make a loss for a product
72
(Dis)advantages of loss leader pricing
increasing sales revenue
good for wide variety of products
bad for small businesses with smaller product portfolios
risk that strategy won't work
73
What is predatory pricing?
selling below your production cost to gain a monopoly and competitors are forced to exit the market, and can then raise prices
74
(Dis)advantages of predatory pricing
able to take up a dominant position in the market
limits possibility of new businesses entering
bad for competitors
impossible in the long-term
considered unethical and illegal in many places
only very large businesses are able to do so
75
What is premium pricing?
selling for high prices (above competition) to try to convince customers of a premium quality
76
(Dis)advantages of premium pricing
customers may believe that the product is better
higher profits as long as costs are controlled
some consumers will not be willing to pay, can only be applied to a target market
77
What is promotion?
communicating a message about your product and enticing a customer
78
What does the keyword 'comment' mean?
provide a judgement based on data
79
What is the goal of effective promotion?
increasing product and brand awareness + image
80
What are the 3 different types of promotion?
above the line promotion
below the line promotion
through the line promotion
81
What is ATL promotion?
mass marketing campaigns, shown to everyone
you do not know exactly who you are talking to
little segmentation of viewers
allows for brand development and visibility
82
What is BTL promotion?
targetted to specific audiences/people - NOT mass media
you know exactly who you are talking to
easily measurable results
83
Pros and cons of ATL and BTL promotion
ATL - good for brand awareness, visibility
ATL - may not drive customer responses
BTL - specific, direct, stronger relationships, drives individual responses, easy to measure result
BTL - difficult for a large target market and large businesses
84
Examples of ATL promotion
TV advertising
newspaper
magazines
radio
outdoors
85
Examples of BTL promotion
direct marketing
loyalty cards
public relations
after-sales service
exhibitions and trade fairs
86
What is TTL promotion?
combination of ATL and BTL
combines mass advertising and direct marketing
87
Advantages of TTL promotion
- benefits of both ATL and BTL
- allows to reach as broad/defined audience
- customisation of message
- increase brand exposure and generate sales
88
How to use social media for promotion?
- content generated by users
- one to one messages
- influencers
- paid ads
89
Advantages of social media for promotion
differentiation at low cost
more knowledge about customers
improvement of customer service
performance easily measurable
90
Disadvantages of social media for promotion
must be part of a broad promotional strategy
has production costs
91
What is place related to?
distribution channels , where customers will consume your product
how products are transported to customers
92
What determines the best distribution channel?
a product customers want in a place they want it
93
What are the two options for distribution?
sell directly or use an intermediary
intermediaries:
wholesaler
retailer
agent
94
What is indirect distribution?
using another company to distribute your product
95
What are the dis/advantages of direct distribution?
keeping all the sales revenue
more control over process, people etc
eliminates intermediary expenses
direct contact with customers
usually more costly
reduces distribution option
increases internal workload
96
What are the dis/advantages of indirect distribution?
usually cheaper
economies of scale
more points of sale - retail
increases reach and brand awareness
good for a broad audience
less control - price, processes, people etc
97
3 different types of indirect distribution
producer --> retailer --> consumer
producer --> wholesaler --> retailer --> consumer
agents or brokers
98
What is the dis/advantage of having more distribution middlemen?
your price will be lower due to comissions and markups, as other companies need prices (however costs are decreased)
99
What are people?
parameters for employees who deal with customers directly
related to services
how are employees supposed to act, speak, dress...
100
What is the people parameter influenced by?
region, nation, demographic
101
What are processes?
how the customer will receive the product? how do you get feedback? after sales support?
procedures and policies
102
Examples of aspects of processes
placing and paying for orders
delivery systems
customer feedback
after sales service
103
What is physical evidence?
environment of the business
for services
sensory experience
