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for ppqs/ppt go to: https://docs.google.com/presentation/d/1xeayv5oFV7rZH8ZhrezQ6YAaNWYwdc7TfnWiAlhrFAg/present?slide=id.g1043a3a28e4_0_0
PPQ: Outline why the production of Dyson’s vacuum cleaner family leads to improved cost effectiveness [2]
The vacuum cleaners would share common parts and assembly which could save costs. The vacuum cleaners family members pass through similar processing steps and common equipment which would being costs down due to bulk purchasing.
What is the marketing mix?
Four factors identified through market research and competitor analysis that provide the designer with an accurate brief of market requirements.
What are the four Ps?
Product, place, price and promotion
What are examples of the four Ps in use?
What is product standardisation?
The process of setting uniform characteristics for a particular product, system or service. (E.G: Coca-Cola uses global standardisation in marketing by keeping the appearance of the product unchanged between different markets, making it always recogniseable)
What is promotion?
The ways that can be used to communicate information about a product or system to consumers and other interested parties. (e.g. flash sales, buy one get one free, coupons, giveaways, limited time offers)
What are the benefits of promotion?
Actively engages users and non-users
Incentivises users to participate and non-users to buy
If shared on social media, free advertising
Generates traffic, brand awareness and sales
Why is price an important aspect of the marketing mix?
If a business sets a price too high then customers are discourages, if they set it too low then it could lead to a lack of stock and unsatisfied customers.
How does penetration work as a pricing strategy?
Company sets a low price to increase sales and market share, once share has been captured, firms may increase the price. A drawback to this is that if the price is too low, customers perceive the product as low quality and inferior.
How does competitor based pricing work as a strategy?
Setting a price in comparison with competitors
How does psychological pricing work as a strategy?
Consider the psychology of price and the positioning of price within a marketplace. (e.g. charging £199.99 instead of £200)
How does cost plus pricing work as a strategy?
The firm adds a percentage to costs as a profit margin. For example, if it costs £100 to produce and the seller wants a 20% profit margin, they will charge £120.
How does product line pricing work as a marketing strategy?
Pricing different products within the same range at different price points. The greater the features and benefit obtained the more the customer will pay.
How does demand price work as a strategy?
The firm sets an initial high price then gradually lowers the price to make the product available to a wider market. The objective is to skim profits of the market layer by layer.
What does place refer to in the four Ps?
The distribution of products- how they get from the producer to the consumer.
What are channels of distribution?
The means used to get a product to the consumer. Intermediaries are used as the middle man to facilitate this.
Traditionally, intermediaries are wholesalers, who purchase large amounts of stock from the manufacturer, then the products are distributed to retailers who sell the products to customers.
However, since the internet, many companies choose to make sales over the internet.
What is above the line promotion?
Costly advertising, typified by newspaper, billboard, magazine, radio, internet adverts, flyers, TV advertising.
What is below the line promotion?
Economical: public relations, point of sale displays, product packaging, email
What are the types of product standardisation?
Government/trading area standardisation: different countries have different standards for products that manufacturers must meet (e.g. uk plugs 230v 5hz vs us plugs 120v 6hz)
Component standardisation: different technologies compete for formal standardisation as they know they will then have a significant share of the market. Also things like USB cables and car tyres are standardised components to allow for interchangeability.
Industry wide standards: Standard testing procedures to ensure that a specified quality is met by all products within a market.
Efficiency and performance: Governments legislate against products that cause high energy consumption
What is a trigger product?
Attract consumers in their own merit for the function and performance necessary to carry out the tasks most consumers require/ (e.g. the kitchen aid and basic mixing attachments)
What is an incremental product?
Available to engage consumers in purchasing add-ons. Little or no intrinsic value - exist to enhance the function of the trigger product. (e.g. kitchen aid add ons such as pasta maker, meat mincer, juicer)
