Marketing Mix And Strategy

Question 1

What is product or service design?

Answer 1

The combination of factors needed in designing a product

Question 2

What is standard design?

Answer 2

products or services that are sold as standard, the customer cannot add any extra features or benefits

Question 3

What does the function mean?

Answer 3

What the item is used for

Question 4

What does aesthetic mean?

Answer 4

What the item looks like

Question 5

What is promotion?

Answer 5

The use of marketing tools to bring a product or service to the attention of potential buyers

Question 6

What is personal selling?

Answer 6

When a salesperson meets a potential buyer face to face with the aim of selling their product/service

Question 7

What is direct marketing?

Answer 7

Highly focussed targeted mail based on what customers have bought before

Question 8

What is Above the line advertising (ATL)?

Answer 8

Involves mass media methods for targeting larger and more general customers

Eg. Advert on the tv

Question 9

What are the advantages to ATL

Answer 9

Reaches mass audience

Advert communication is repeated so the message is clear

Great for building brand awareness

Question 10

What are the disadvantages of ATL

Answer 10

Very expensive

Hard to measure clear results

Question 11

What is below the line adversing (BTL)?

Answer 11

The same as direct marketing for reaching smaller but more targeted audiences

Question 12

What are the advantages of BTL?

Answer 12

Easy to measure if the campaign reached an audience

Easy and inexpensive

Question 13

What are the disadvantages of BTL?

Answer 13

Training may be needed on marketing

Need a good understanding of customer or buyer behaviour is required

Question 14

What is public relations?

Answer 14

Aims to build a relationship between the business and the public to create a favourable copywriter image- long term strategy

Question 15

What is sponsorship?

Answer 15

The financial or in kind support of an event with the objective of attaining certain business objectives

Question 16

What is pricing?

Answer 16

The process of pricing is the choice of pricing strategy that a business makes when setting prices for their products or services

Question 17

What is cost plus pricing?

Answer 17

A cost-plus pricing strategy seeks to set a price for a product or service which covers the costs and provides a good profit margin for the business

Question 18

What are the benefits to cost plus pricing?

Answer 18

Protects the profit margins of the business
Easiest method of pricing to apply
Easy to estimate profit levels

Question 19

What are the drawbacks of cost plus pricing?

Answer 19

This method of pricing does not take into account the prices of the competition

Question 20

What is skimming pricing?

Answer 20

The price is set high to start and as more people join the market the price is decreased

Question 21

What are the benefits of skimming?

Answer 21

A high starting price can establish an upmarket image

For innovative products it can be a great way to harvest high profits from early buyers who want the latest product and are prepared to pay a premium

Question 22

What are the drawbacks of skimming?

Answer 22

Cheaper imitations of the product may appear on the market too soon and take sales away from the product
Risky strategy as customers may be put off from buying due to the high price

Question 23

What is competitive pricing?

Answer 23

Having your prices the same as your competition so the customer has to make a decision on other factors such as service speed

Question 24

What are the benefits of competitive pricing?

Answer 24

Makes consumers focus on non-price incentives

Question 25

What are the drawbacks of competitive pricing?

Answer 25

Pricing at the competitive rate may not cover all the costs of some smaller businesses which can’t get the same economies of scale as the larger ones

Question 26

What is penetration pricing?

Answer 26

This means setting prices really low on a new product to encourage sales and to persuade customers to try the product. Then when they like the product and have to keep buying it the business raises the price

Question 27

What are the benefits of penetration pricing?

Answer 27

Works best with new products being launched to encourage consumers to try the product

Question 28

What are the drawbacks of penetration pricing?

Answer 28

Consumers may have bought anyway, even without the low start price Expensive as it eats into profits by reducing sales revenue

Question 29

What is predatory pricing?

Answer 29

In oligopolies existing businesses may hold off the threat of a new entrant to the market by lowering their prices so that any competitor cannot make a profit.

Question 30

What are the benefits of predatory pricing?

Answer 30

The intention with predatory pricing is to drive competitors out of the market place or set a barrier to entry to discourage new entrants to the market

Question 31

What are the drawbacks of predatory prices?

Answer 31

Depends on the price elasticity of the product, if it is low then a lower price won’t make much difference to customer demand

Question 32

What is psychological pricing?

Answer 32

This means pricing a product at £1.99 rather than £2.00 to appear cheaper

Question 33

What are the benefits to psychological pricing?

Answer 33

- Seems cheaper than it is - easy to implement - generates more sales

Question 34

What are the drawbacks to psychological pricing?

Answer 34

Psychological pricing strategy can be high risk, if comparable products are available for a lower price consumers could be tempted away

Question 35

What is distribution?

Answer 35

The process of getting the right product or service to the consumer in the right place

Question 36

What are the 4 stages of distribution?

Answer 36

Manufacturer Wholesaler Retailer Consumer

Question 37

What Is marketing?

Answer 37

The management process of identifying, anticipating and satisfying consumer demands for profit

Question 38

What is a marketing strategy?

Answer 38

The methods used by a business to achieve their marketing objectives

Question 39

What is product development phase?

Answer 39

first stage of the product lifecycle where a product is designed and market research is analysed to produce a product which will satisfy customer needs

Question 40

What is the introduction phase?

Answer 40

When the product in finally launched and released to the public. May be costly as advertising and marketing could be needed

Question 41

What is the growth phase?

Answer 41

products are enjoying rapid growth in sales and profits

Question 42

What is the maturity phase?

Answer 42

face intense competition now all the producers have joined the market

Question 43

What is the decline phase?

Answer 43

profits and sales have fallen and the product may be withdrawn from sale