Topic 5- Marketing Flashcards
(103 cards)
1
Q
What is the point of marketing?
A
- Generate profits
- Promoting their brand to the public
- Making awareness of their product
2
Q
What is marketing?
A
A management process of identifying, anticipating and satisfying customers wants profitably.
3
Q
Why do market research?
A
- get advice from public, eg. How much they’d pay
- satisfy customers (meet demand)
- see competition
- to get more awareness
4
Q
What are the two different ways of doing market research?
A
Primary and secondary research
5
Q
What is primary research?
A
Gathering information yourself by using surveys and questionnaires
6
Q
What is secondary research?
A
Using existing information, data that has already been gathered, eg. Online or from competitors
7
Q
What is quantitative market research?
A
It’s numerical, the data collected is easy to analyse and put into a graph, eg. 90% of people prefer milk chocolate
8
Q
What’s qualitative market research?
A
Non numerical research. It is about people’s OPINIONS, eg. I prefer dark and white chocolate in the same bar.
9
Q
List 2 Advantages of primary research
A
- Up to date, so it is reliable
- they are tailored to meet the business’ needs
10
Q
List 2 Disadvantages of primary research
A
- Takes time
- Hard to do, lack of expertise (may do it incorrectly)
11
Q
List 2 Advantages of secondary research
A
- Very quick to access, saves time, productivity up
- Free of charge, not damaging to the business, saves money
12
Q
List 2 Disadvantages of secondary research
A
- May not be accurate (outdated), some markets change very rapidly, business may make the wrong decisions
- May not be specific to you, may not be according to your specific target market
13
Q
Why do businesses often do experiments before launching their product?
A
Because launching a new product is often costly they do experiments to check that they are likely to succeed.
14
Q
What are the 4 p’s of marketing?
A
Product
Price
Place
Promotion
15
Q
What is product differentiation?
A
A marketing process that gives a business an advantage by making their product unique and stand out from other competitors.
16
Q
List 4 methods to differentiate?
A
- Quality ( offer a higher quality to others)
- Price ( offer a cheaper price than competitors)
- Technology ( a phone with more advanced technology to other brands)
- Experience (yo sushi)
17
Q
How does dyson differentiate?
A
Through innovation. This leads to a larger target market which will lead to higher sales figures. This allows them to explore into different markets (e.g. hairdryers) because of the incomes capital.
18
Q
What is the plc?
A
The product life cycle
19
Q
What are the 6 stages of the plc?
A
Research and development, Introduction, growth, maturity, decline, decontinued
20
Q
On the plc what is the stage where it is starting to go down hill and what happens there?
A
Extension strategy, this is where it is trying to stay alive.
21
Q
What is happening in the research and development phase of the plc?
A
No sales, negative profit, product is innovative and being designed
22
Q
What is happening in the Introduction phase of the plc?
A
Low sales, high promotion, neutral profit, high price
23
Q
What is happening in the Growth phase of the plc?
A
Sales increasing, thinking of innovation, medium promotion and price, positive profit
24
Q
What is happening in the Maturity phase of the plc?
A
Peak sales, innovation, low promotion, high distribution, positive profit
25
What is happening in the Decline phase of the plc?
Low sales, limited promotion, low price, negative profit
26
List 4 ways of growing
- Explore new countries
| - Explore new markets (lucozade, medicine to energy drinks)
27
Why are prices important to a start up?
- it is what they rely on
- impacts popularity
- way of competing
28
What is the boston matrix?
A way of categorising different brands into their status/how developed they are
29
What is market share?
the portion of a market controlled by a particular company or product
30
List 3 things that the plc shows
- Market share can be gained by investment in marketing
- Cash surpluses are generated when the product is in the maturity stage of the life cycle
- The best way to build a dominant market position is during the growth phase
31
What are the 4 categories of the boston matrix?
Cash cows, stars, dogs and question marks
32
What are stars? (BM)
Star products have a high market share in a fast growing market. eg. new iPhone
33
What are cash cows? (BM)
Cash Cows have a high market share in a slow growing market. These are successful products with little need for investment. e.g. walkers crisps
34
What are question marks? (BM)
Question marks or problem children products have a low market share in fast growing markets. This suggests they have some potential but may need some investment. e.g. airpots, apple watch
35
What are dogs? (BM)
Dogs are products with a low market share in slow growing markets. They have enough money to break-even but very rarely worth investing in. They are normally sold or closed. e.g. iPods
36
What does a business ideally want on the BM?
Have a balanced portfolio with very little dogs.
37
What is competitive pricing?
when a firm decides its own price based on the price charged by rivals eg. tesco
38
What is cost plus pricing?
when a business chooses a price that ensures a profit. One drawback is that it may bot be very competitive.
39
What is loss leader pricing?
When businesses are willing to set prices below unit cost. They do this to gain sales and market share. e.g. supermarkets
They sell their products lower than unit costs to get people into the stores
40
What is penetration pricing?
Setting a relatively low price when first launched to boost sales. e.g. walmart
41
What is price skimming pricing?
Setting a relatively high price to boost profits. This is often used by well-known businesses. eg. new TECHNOLOGY
42
What is psychological pricing?
selecting a price to which consumers will have an emotional reaction e.g. a car priced at $15,995 instead of $16,000
43
What is destroyer pricing?
An illegal practise where firms lower their prices to such a damaging level that they run at a loss. They do this to put their competitors out of the market eg. putlocker
44
What is prestige pricing?
When firms set prices of luxury products to the expectations of a niche class of customers who associate higher prices with superior quality e.g. Chanel
45
Who is suffering from destroyer pricing?
Small corner shops are suffering due to destroyer pricing. Places like pound land are putting prices much lower so the corner shops lose customers.
46
What is discrimination pricing?
When companies charge customers different prices for the same product or service, e.g. airplane fares for different ages
47
List at least 4 promotional methods
- Underground
- Bus stops
- TV adverts
- celebrity endorsement
48
What are 4 promotional methods small businesses would use?
Leaflets, local newspapers, sampling
49
What are 4 promotional methods big businesses would use?
Underground, billboards, celebrity endorsement
50
List 4 factors that help determine the promotional method selected
- Cost
- Target audience
- Attract new or existing customers?
- 'footfall' (how many people will see it)
51
What is branding?
How the business and product is distinguished from competitors
52
How can you 'build your brand'?
- having a distinguishable colour (cadbury)
- slogan
- create an identity that is superior to others
- Celebrity endorsement
53
List 4 benefits of branding
- Customer recognition
| - Add value to your product
54
What are the advantages of segmenting your market?
It allows them to focus on a particular target audience meaning they will gain interest from that market from personalising it to them. This will secure certain customers and result in a higher amount of sales. You will also become a recognised specialist.
55
What is the channel of distribution?
The route by which a product goes from the manufacturer or device provider to the customer.
56
What are the 4 possible channels of distribution?
1) producer to wholesaler to retailer to customer (‘traditional’)
2) producer to retailer to customer
3) producer to customer (‘direct’)
4) producer to e-commerce to customers (online)
57
What is a wholesaler?
Where they buy products straight from the producer in bulk
58
What is a retailer?
Any store selling directly to the customer
59
What is m-commerce?
Buying on the go on your mobile
60
How can a business segment their product?
- Gender
- Age
- Hobbies
- Income
60
List 4 factors that affect price
- Production price
- Target audience
- Competitors
- Quality
60
2 Advantages of the plc
- See at what stage you’re at
| - Make sure you’ve got products in every stage
61
2 Advantages of the Boston matrix
- See where there is a gap in your business
| - See where you should invest, you want to invest in stars and problem childs, cash cows grow by themselves
62
What is segmentation?
when a market is divided into different groups of needs and wants
63
why is the process of segmentation beneficial?
- It means they can target their customers more precisely
- to fit customer needs more closely
- set the price appropriately
64
how do you calculate the value of sales?
number of units sold x sppu
65
how do you calculate market growth?
market growth = change in market size / original market size x 100
66
What are four ways of segmenting a market?
- by gender (aftershaves made for men and perfume for women)
- by age (toy company more offer some toys for younger customers and some aimed older consumers)
- by location (a food business may change its menu according to location, mcdonalds changes its menu in different countries)
- by income (companies may sell basic products in low-income areas but more expensive products in wealthier areas)
67
how do you calculate market share?
market share = sales of the product / total market sales x 100
68
How does market research help managers? (2 points)
- identify opportunities in the market (meet demand)
| - weigh up different possible actions
69
What are three different ways of primary research?
- observing
- surveying
- experimenting
70
What are three different ways of surveying?
- questionnaires
- customer feedback
- internet research ( find the no. visitors on a website, how they found the site)
71
What is the marketing mix?
Refers to all the activities influencing whether or not a customer buys a product.
72
What are 3 factors influence the choice of marketing mix?
- the product- is it distinctive?
- the target customers - how much do they earn?
- business approach- are you trying to match what your competitors do?
73
When developing a new product what must a business consider? (3 points)
- the design
- the price
- the expected sales
74
What is an extension strategy?
Attempts to maintain the sales of a product and prevent it from entering the decline stage of the product life cycle.
75
What are two different extension strategies?
- cutting the price
| - spending more on advertising
76
What are 3 factors that influence the price of a product?
- costs
- competitor's pricing
- stage in the product life cycle
77
Give 3 reasons why promotion is sued?
- to inform customers about a new product
- to increase sales by using a special offer
- to change the image of the product (may want customers to se it as a more premium product and worth paying extra for)
78
What are three ways of connecting the distribution channel?
- mail-order businesses- ordering by catalogues and not from physical retail outlets
- telesales- selling over the phone
- e-commerce, m-commerce
79
What is direct marketing?
When there is a direct link from the producer to the customer without any intermediaries
80
What are two advantages of selling direct to a customer?
- customers can order at any time
| - customers can order from home
81
What are two disadvantages of selling direct to a customer?
- need to be able to distribute to a much wider range of destinations, logistics and cost issues
- need to be able to handle returned goods, because customers can't try them on there is more of a chance that they are returned.
82
What is a intermediary?
A link in the distribution chain between the producer and the customer
83
What are two advantages of using intermediaries in the distribution channel?
- a producer can access many thousands of customers by selling to retailers hat distribute to their own stores.
- by selling in other business's stores enable the customer stop compare what is on offer
84
What are two disadvantages of using intermediaries in the distribution channel?
- price may be increased at each stage to make profit
| - the producer loses control
85
What do businesses need to think about when choosing their channel of distribution?
- costs (cost of distributing through hotter business or directly)
- lack of control (the way the prices are displayed, the way the shop looks)
86
Explain what is meant by an integrated marketing campaign
Having all aspects of the marketing mix connected, eg. If you were to sell s high quality product the packaging should display this image. Price, place, promotion, product.
87
Why might the marketing mix evolve over time?
Due to new competitors and them releasing new products you will have to change your product
88
How can the marketing mix be used to inform or implement business decisions?
Change your promotional methods to advertise a new product
89
Why is it important to identify and satisfy customer needs?
- provide a product or service that customers will buy
- improve sales
- select the correct marketing mix to suit them
- avoid costly mistakes
- be competitive
90
how do you calculate market share?
sales of the product/ total market sales x 100
91
how do you calculate market size?
use your market share answer and find 100%
92
How do businesses use gender to segment a market?
A company may produce aftershaves for men and perfume for women. Having some products specifically targeting women and other products targeting men.
93
How do businesses use income to segment their market?
A business may target higher-income earners with some products and lower-income earners with others. In relatively low-income areas a company like a Unilever May choose to sell a basic washing powder but in a more affluent area they would sell a more supreme powder with a fragrance.
94
What will happen from effective segmentation?
It allows a business to decide what to segment to target. It can then focus its marketing activities on its customers. This will make their marketing more cost-efficient and more successful.
95
What is market research?
The process of gathering, analysis and processing data relevant to marketing decisions.
96
Why is innovation important?
- if you’re in a dynamic market you need to be constantly changing to keep up with market
- growth
97
What is meant by sales promotions?
Short term strategy, promotions like 50% off and buy one get one free.
Used by supermarkets
98
What is meant by advertising?
Raising awareness of their product through flyers, billboards
99
What is meant by PR?
public relations. How the public perceives the business. Sponsor a charity and then people will think good of your business.
100
What is meant by sponsorship?
Getting someone to promote your brand
101
What are the factors rating influence the choice of promotional mix?
- the product
- target market
- cost
