Higher business marketing

What is marketing?

What is marketing?

Identifing consumer needs and wants and meeting them in such a way that the producer makes a profit

What's a market ?

A market is a group of people that could potentially buy the businesses product or services

What's a target market

A specific group of costumers that a business will aim its products or service at

Target market segment

a specific group of customers in the broader target market who are most likely to buy a product or service.

Whats consumer behaviour

Consumer behaviour is the decisions and actions made by consumers when purchasing

Routine purchases

Purchases that consumers make regularly without much thought

Impulse purchases

Purchases made on the spur of the moment

What is Limited decision purchases

These purchases are less routine and require some thought, for example deciding which flavour of crisps to buy

What is extensive decision -making purchases

These purchases require a lot of thought and prior research, they will take time to finalise and will be influenced by finance available, family status, etc

What is Product led marketing

This is when a firm invents a product without finding out if it's what consumers want

Advantages of product led marketing

- can focus on quality of product or service

- organisation can invest in technology and apply it to a range of products/ services

- can outsource production to focus on core design

Disadvantages of product led marketing

- needs of the market are ignored

- technology could quickly be superseded when competitors enter market and product becomes out of date

- change in taste and fashion will not be accounted for

Advantages of market led marketing

- consumers are more likely to buy the product if it meets their needs

- more likely to anticipate and meet changes in consumer demands

- able to change its products or develop new products easily

Disadvantages of market led marketing

- market research is expensive

- future is unpredictable therefore high risk of failure

- constant change within organisation as it strives to meet the aims of the market

What is market research

Gathering, recording and analysing information about the market for goods and services

What does market research look for

It finds:-

- costumers wants regarding existing products

- costumers reaction to new products

-customers wants to help in the development of new products

2 types of market research

Field research and desk research

What is Desk research

- secondary information that exists

Method of desk research

News paper, internet, government statistics, market research agencies

Advantages of desk research

- Less time consuming

- less expensive

- wide range of services

Disadvantages of desk research

- information is not specific to your needs

- cannot be sure about accuracy

- information may be out if date

Methods of field research

Face to face, interviews, telephone interview, postal survey, online survey, focus group , hall test

Field research advantages

- it is specific to your needs

- it is accurate

- it is up to date

Field research disadvantages

Time consuming, expensive, requires skills to conduct

7P's

-product

- price

- promotion

- place

- people

-process

Physical evidence

What's a product

The actual item, whether a good or service, which is produced and sold to the costumers

Product Life Cycle

development, introduction, growth, maturity, saturation, decline

What happens at the research and development stage

- company making a loss as currently no sales on the product

- money is invested for development

-finance is lost

- idea behind product is investigated and developed

What happens at the introduction stage

- product first launched onto market - sales are slow

- unlikely to be profitable at this stage

- advertising and promotion campaigns used to increase awareness and attract customers

- high costs incurred

What is product branding

- a product with a "personality"

- instantly recognisable by logo, packaging, taste, advertising and other features

- believed to be a guarantee to quality

- usually cost more

Product branding advantages

- can charge a premium price

- high awareness

- perceived high quality

- easier to launch new products

Product branding disadvantages

- high initial financial outlay

- high marketing costs

- counterfeit goods

- own brands

Maturity stage

- Product sales reach their highest, the product is well known and sales don't get any higher

- saturation starts to go down

decline stage

sales decrease as the product is no longer popular or has been replaced with new technology

What is an extension strategy

These are changes that a firm will make to a product or service to extend the life of the product or service

Examples of extension strategies

- improving existing product

- changing the packaging

- changing the price

-having a promotional campaign

- changing the name

What is sampling?

When conducting market research it is often not feasible to question every potential respondent, that is everyone you could ask.

Instead, marketers choose a small number of consumers to conduct market research

What does the pricing of product depend on

- how much it costs to make the product

- brand image

- where the product is sold

- packaging

Pricing Stategies

low price - pricing products low to show good value for money

High price- pricing products high to show high quality/ luxury image

What is psychological pricing

Making costumers think they are getting the item, cheaper, for example £99 of 99p

What is price skimming

- pricing the product high when its first launched the gradually lowering as time goes on

What is competitive pricing

Pricing the product as the same as competitors

Place (marketing mix)

- Place is where customers buy the products or access the service a business sells

Business can sell their products using :

Shops, websites, television, Newspapers/ magazine, catalogs, e-tailors (Amazon)

Advantages of websites

- shipping free

- easier access for customers

- more option/ wider range

- 24/7 access

- more sales due to selling approach

Disadvantages of websites

- restricting customer base

- relying on technology

- shipping cost/ time

- refund/ returns

Place advantages

- customers can see/ feel products And try them on

- sales advice

- planning purchase

Disadvantages of place marketing

-Theft

-employee costs

- costs of running the stone

-restricted opening times

- rules and laws

What is promotion?

Promotion is how we persuade the customer to buy a product/service

Methods of advertisement

Tv, billboards, radio, social media, bus stops , leaflets/posters , websites and cinemas

What is sampling

When conducting market research it is often not feasible to question every potential respondent -that is everyone you could ask.

Instead marketer's choose a smaller number of consumers to conduct market research on

Methods of sampling

Random sampling

stratified random Sampling

quota sampling

Random sampling

-Individuals are pre-selected from a list, e.g the voters list

- each person has an equal chance of being chosen

- no bias involved in selection- however may be unrepresentative

- must interview people selected ( for example cannot just go to the next person if they are not available - expense

stratified random sampling

sample is divided into segments according to age/where you live with a representative sample then chosen from each group

Advantage of stratified sampling

Makes a random group more representative, e.g more typical of the potential market as it gives the opinion of people from a variety of segments

Disadvantages of stratified sampling

More administration and effort than sample random sampling

quota sampling

Interviewers are given targets for the number of people out of each segment (e.g age, gender, martial status) they must interview

More targeted method of sampling the population interested in particular goods/services I.e you should only be asking those who you see as being potential customers

Portfolio product

When an organisation has many products aimed at different segments

Benefits of brand portfolio

-helps increase brand awareness and loyalty by targeting multiple levels simultaneously

-spreads risk by catering to different segments and can help to increase profits

Product line portfolio

Where spin of products are developed and released from the original or first brand

Diversified portfolio

When a company has products in completely unrelated markets under the same name (e.g virgin Mobile, virgin media, virgin Atlantic, virgin hotels)

Boston matrix

Marketing tool used to analyse product portfolio developed by Boston consulting group hence the more common name of Boston matrix

Four categories of Boston matrix

Star's, question marks , cash cows, dogs

Stars (Boston Matrix)

- high market share

- high market growth

- profitable phase

- most potential

- spend a lot on promoting

Question Marks ( Boston Matrix)

Products with a low market share in a high growth market

Dogs (Boston Matrix)

Products with low market share in a low growth market.

Cash Cows (Boston Matrix)

Products with a high market share in a low-growth market.