Flashcards in Marketing Deck (62):
What are the 4 elements to marketing?
List 3 factors that can affect a business’s marketing mix
Changes in technology
Customers’ needs and wants
How competitive the market is and what a business’s competitors are doing
Give an example of what could affect the price of the product
The cost it is to make, depending on what quality you want you product
Are products more likely to be cheaper online or in store, and why?
In stores it’s usually fixed prices.
What can be useful to know about the structure of the market for a business?
The market size and the market shares it has
What is meant by the term ‘market size’?
It is the number of individuals within the market which are potential buyers or sellers of products.
Can also mean the total value of products in the market
What is meant by the term ‘market share’?
It’s the proportion of the total sales within the market that is controlled by the business.
Other than the market share and market size, what else is useful to know?
How a market is segmented.
What does segmentation mean?
When people within a market are divided into different groups.
Why is it useful to know the different market segments?
It can allow a business to identify their target market.
What are demographics? Give examples
Identifiable characteristics that people within one population might have.
Age, Income, Gender
Other than demographics, how else is the market segmented?
Why is market research important?
It helps a business understand its customers and competitors
Customers’ needs may include things like:
Type of product, the quality of a product, the price, the convenience of where it’s sold and how much choice they have if a range of products.
Market research helps businesses to:
Make informed decisions- what products to sell, price etc.
Increase sales- adjust their prices
Stay competitive-develop things before competitors do
What is primary research?
Collecting information for yourself; getting information from customers or potential customers.
Why is primary research useful?
You can find out new information and get customers’ views
What are useful ways for small businesses to carry out primary research?
Research over the telephone or internet.
Advantages of primary research
Specific to your business
Specific to the target market
Disadvantages of primary research
It’s expensive and time-consuming
Documents with questions.
Cheap and good for large geographical area, likely many people won’t respond
Collect information from people e.g. over the phone or using questionnaires.
Phone surveys more likely to get a response, could be expensive
Asking people face to face
Good rate of response but can be expensive
Small group of people discuss feelings about product.
Faster than surveys, quieter individuals don’t get opinion heard
Observing what people do or say without asking
Cheap and accurate, don’t allow customers to give opinions
Launch a product to a small selection of people and record how it sells.
Can make changes to product if needed
Competitors can get an idea of the product
What is secondary research?
When you look at other people’s work and use their data
Examples of secondary research:
market research reports, government publications, and articles in newspapers and magazines and on the internet
Advantages of secondary research.
Cheaper, easily found and instantly available.
Disadvantages of secondary research
Not always relevant, not specifically about your products, and it’s often out of date
What is Quantitive research?
Anything you can measure or reduce to a number
What is Qualitative research?
It’s people’s feelings and opinions.
Hard to compare 2 people’s opinions. However, it’s in greater depth
What are the 5 steps of the Product Life cycle?
Research and Development
What are the 6 types of Pricing Strategies?
Loss Leader Pricing
What is Price Penetration?
Give advantages and disadvantages
Firm charges a very low price when a product is new to get lots of people to try it
Adv- Establish a market share in a competitive market, loyal customers
Disadv- Very little profit
What is Loss Leader pricing?
Price of product set below the cost.
Firm doesn’t make a profit but customers will buy other products at the same time
What is promotional pricing?
Products are put on offer for limited period.
Increase demand in short time. Increase market share or sales revenue
Customers may stop buying the product when it’s full price
What is Price Skimming?
Charge a high price to begin with.
Usually know there will be a high demand of the product- technology
Established firms that have loyal customers
High prices increase revenue and covers research and development costs- more desirable to people with high incomes
Lowers price to become apart of a mass market
What is Competitive pricing?
Charge similar prices to other firms to other firms
Lots of choice and not much product differentiation
Might make little profit
What is cost plus pricing?
Use this if they’re not in price competition with producers.
Add the cost and how much profit they want to make together
Why do firms spend lots of time on promotion?
Inform customers about the product
Persuade customers to buy the product
Create or change image of a product
Create or increase sales
Why is good branding important?
The brand image is the impression that customers have of the firm or products.
Products with a strong brand image and easily recognised and liked by customers.
Is brand image and promoting products expensive?
Yes, however they should increase the revenue. Business should’ve planned to cover costs
List the 7 examples of advertising:
Television- wide audience, expensive
Internet- large targeted audience, people could block them
Explain businesses sponsoring an event
Firms give money to organisations and events for their name to be displayed by an organisation or at the event.
Examples of sponsorship;
Sport- a large firm stamp its name on an international competition. small firm could only afford sunday league teams
Television- some soap operas and weather reports are sponsored by well known brands
Advantages of sponsorship
Can create a high profile for your business or brand name. Target a market segment that is characterised by lifestyle.
Disadvantages of sponsorship
If the thing your sponsoring gets bad publicity, your company might suffer too
What does PR stand for?
What is public relations?
When you communicate the media to promote
Advantages of PR
Cheap and easy way to get a firm noticed by a wide audience.
Disadvantages of PR
Once it’s spoken to the media it has little control over what the public see or hear.
How can social media be used for promotion?
It’s quick, easy and cheap.
Could advertise or offer sales, share news stories and build up excitement for
Different accounts for different parts of the business, target market segments.
Add info whenever they like, respond quickly
Customers can go quickly from the page to the website
Disadvantages of social media
Mistakes and negative customer comments can be seen quickly by lots.
What is targeted advertising?
An individuals internet search history can be used to create target advertising.
Web pages will have space for adverts, but it depends on what the individual has searched before.
Also depends on location
What are the 3 channels of distribution?
Selling to wholesalers
Selling directly to retailers
Selling directly to customers
What is selling to wholesalers?
Wholesalers but products in bulk and store them in a warehouse.
Manufacturers sell products to wholesalers, consumers or retailers buy.
Advantage of selling to a wholesaler
Good for wholesalers that make lots of particular products and don’t need to communicate
Doesn’t have to store lots of stock
Can reach potential consumers quickly
Explain selling to retailers
The producers sell directly to the retailers who sell directly to the consumers
What is digital distribution?
The goods or services downloaded digitally. no physical product being moved
Advantages of digital distribution
More time efficient