marketing mix Flashcards
price factors
-fixed and variable costs
-competition
-company objectives
-target groups and willingness to pay
dynamic pricing
different prices for diff consumer groups
-e.g. business or economy class
penetration pricing
used to enter a product into a new market, price should be lower than competitors
+ensures sales are made when product enters new marker
-low price –> low sales revenue
psychological pricing
setting the price that changes the consumers perception of a product
-provides customer status, esp for a high price product
-e.g. 5.99 instead of 6.00
promotional pricing
lowering price of goods for a short period of time
+gets rid of unwanted stock
+renews interest in a product
-sales revenue will be lower
price skimming
high price when new high quality product enters the market, usually technology
+helps establish product being good quality
-lose potential customers
cost-plus pricing
covering all the costs and adding a small percentage mark-up for profit
+easy to apply
-lose sales if higher than competitors price
competitive pricing
setting your price at a similar level or lower level than competitors
+sales are high
-research on competitors -> time and money
factors affecting location of a manufacturing business
market:
-need to be near to transport perishable goods
-need to be near to cut transportation expenses
production methods and location decisions:
-small scale: transport and location of suppliers are less important
-large scale: transport and location of suppliers are more important
government influence:
-zones
-restrictions
-grants/subsides
availability of labour:
-availability of skilled labour
-wages of labourer’s may vary in different areas
-personal preference
factors affecting the location of a service sector business
-need to be close to customers
-some services can be remote
-personal preference of the owner
-availability of skilled/unskilled labour
-climate, tourism related
-proximity of other business, competition or to provide services
-rent, taxes
factors affecting the location of a retail business
shoppers:
-do shoppers already go there?
-what kind of shoppers go there?
-nearby shops which attract trade?
availability of suitable vacant premises:
-good sites are in short supply
rent/taxes:
-the more popular the site, the more expensive
access for delivery vehicles:
-for delivering goods
security:
-goods can be stolen
-insurance reluctant to insure the shop
legislation:
-laws restricting the trade of goods in certain areas
factors that influence a business to relocate
-expansion
-raw materials run out
–>import from elsewhere, relocate to cheaper or more abundant raw materials
-difficulties with labour forces
–>wages are too high, needs skilled labour
-new markets open up overseas
–>cuts transport costs, bypass trade barriers (tariffs, quotas)
-government grants
