Unit 5 - Marketing Flashcards
(17 cards)
What are the four elements to marketing?
Marketing mix:
- Product
- Price
- Promotion
- Place
Describe each element of the marketing mix.
- Product - need a product to fulfil customers needs and wants
- Price - needs to be good value for money
- Promotion - product must be promoted so potential customers know it exists
- Place - must be sold in a convenient place for customers - can also refer to channel of distribution
What is market size?
The number of individuals within the market which are potential buyers or sellers of products
- can also mean total value of products in the market
What is market share?
The proportion of total sales within the market that’s controlled by the business
What is segmentation? Give example.
When people within a market are divided into different groups
- Age
- Income
- Location
- Gender
How is market research useful for businesses?
Helps a business to understand its customers and competitors - Helps find gaps in the market - Helps create good marketing mix
- Helps increase sales
- Can stay competitive
- Can create targeted marketing
How can market research find Market opportunities?
Sometimes a group of customers aren’t having their needs met - this is a market opportunity
Could mean development of new product or selling products in new places or at a new price
What does the type of market research used usually depend on in a business?
- How big it is
- How much money it can afford to spend
- How quickly it needs the data
- How much data it needs
What is primary research? Give examples.
Doing your own work - Involves asking for customers’ views on your products - (E.G. Questionnaires, phone surveys, interviews, focus groups)
Generally ask a sample of people
- Large samples are more accurate but more expensive
Advantages:
Provides data that’s up-to-date, relevant and specific to your business
Disadvantages:
Expensive and time-consuming
What is secondary research? Give examples.
Using other people’s work
Gives access to wide range of data - Useful for looking at whole market and analysing past trends to predict the future
- E.G. Market research reports, Government publications, newspapers, magazines, internet
Advantages:
Cheaper than primary research / data is easily found / data is readily available
Disadvantages:
Not always relevant to your needs, not specifically about your products, often out of date
What are the two types of data?
- Quantitative - Anything you can measure or reduce to a number
- Qualitative - About people’s feelings and opinions (hard to compare people’s opinions - however, gives greater depth of info)
Describe the process of the product life cycle.
1 - RESEARCH AND DEVELOPMENT - Develop an idea into a marketable product
2 - INTRODUCTION - Product is launched and put on sale (usually backed up with advertising and sales promotions - Place is also important ‘P’ here)
3 - GROWTH - Demand increases until product becomes established
4 - MATURITY - Demand reaches its peak during this stage (promotion becomes less important) - business tries to make product more widely available - towards end of maturity the market becomes saturated and there’s no room to expand
5 - DECLINE - Event demand starts to fall as rival products take iver
How are sales and profit during the product life cycle?
DEVELOPMENT AND INTRODUCTION - Firm spends money on research and promotion but sales are usually low - Businesses will expect to make a loss in these stages
GROWTH AND MATURITY - Business will hope to earn enough money to pay back initial investments and make a profit
DECLINE - Firm will probably spend less money supporting the product and sales fall - will begin to make a loss unless business stops making the product
When might people use extension strategies?
During the decline phase of life cycle
Advantage:
- Product will make profit for longer
Disadvantage:
- Have to spend more money on product - Takes cash away from other parts of the business
What are 5 examples of Extension Strategies?
- Adding more/different features
- Using new packaging
- Targeting new markets
- Changing advertisements
- Lowering price
What is a product portfolio?
The range of different products that a business sells
- Businesses aim for it to be balanced (ideally selling a variety of products, all at different stages of the life cycle)
What is the Boston Matrix?
A way for firm to analyse its product portfolio
The market share of each lroduct
