Studied by 0 peopleWhat 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- technology could quickly be superseded when competitors enter market and product becomes out of date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.
Note
Flashcard