Marketing

This topic will cover the marketing mix, including all the four p's.

Product orientation definition

When the business bases its marketing mix on what the business sees as its internal strength, taking little notice of customers changing wants/needs

Market orientation definition

When a business bases its marketing mix decisions on its perception of what the market wants

Asset-led marketing definition

Refers to using assets like the brand name, skills and experience of the workforce and management, plant, machinery, and technology to help satisfy the consumer's demand. (This involves relating what the business is good at to the consumer's needs.)

Marketing mix definition

An analytic model that is used by businesses to attract customers by combining the basic pillars of any marketing strategy to positively influence consumers and help maximise sales

Unique selling point (USP) definition

When the product or service had a feature or features which can be used to separate it from the competition

Product portfolio definition

the mix of products the business produces and sells. Having a product portfolio makes a great deal of sense in several ways. this combines the product breadth and depth

explain product differentiation

Making products that are different from the competition is important, it separates the brand from others. Products might be very similar in the way that they are made or used but may be perceived quite differently by consumers.

Product life cycle definition

This represents the different stages in the life of a product and the sales that are achieved at each stage. The length can vary product to product. It typically includes the introduction, growth, maturity, saturation and decline stage.

Uses of the product lifecycle to businesses

Helps forecast sale trends, can help the business adapt their strategy, and manage the product portfolio effectively.

Limitations of the product lifecycle

Not all products follow the typical trend, its hard to predict how long each stage will last, its only a prediction so should be used alone.

Extension strategies definition

Are used to extend the life cycle of the product. this could be through repositioning, relaunching or by offering new features

Boston Matrix definition

A analytical tool used to evaluate a company's product portfolio based on market growth and market share, helping businesses make informed decisions about resource allocation.

Cash cows definition

Are products that generate high revenue with low investment, often in a mature market, providing funds to support other product areas.

Stars definition

Are products with high market share in a fast-growing industry, requiring significant investment to maintain their position and capitalise on growth opportunities.

Question marks / problem children definition

Are products with low market share in a high-growth market, presenting both significant potential and uncertainty for investment and growth.

Dogs definition

Are products with low market share in a mature industry that do not generate much profit, as a result they are usually sold or discontinued

Boston Matrix limitation

is that it oversimplifies the complexities of market dynamics, failing to account for external factors. it only provides a snapshot of a product's current position without considering changing market conditions. Defining the market can be difficult

Cost plus pricing (Mark-up) definition

When a percentage markup is added to the cost of producing a good or service to calculate the selling price.

Full cost pricing definition

This is similar to cost-plus pricing, but takes all the costs of the business into consideration. This means that each product/service will have a proportion of overhead costs, such as marketing and administration.

Contribution pricing definition

Price will be based on the variable costs plus a contribution towards overheads and profits.

Market skimming definition

Involves charging a high price for a product with a USP for a limited period in order to maximise profits while the product is new and unique to the market.

Penetration pricing definition

Involves pricing a product at a low level so the business gains a large market share and customer loyalty that then prices go up they will still continue to purchase it.

Loss leader pricing definition

Involves selling products at a loss with the expectation that this will generate further sales elsewhere in the business. The additional sales that occur will hopefully recoup the initial loss and subsequently make a profit for the business.

Destroyer pricing definition

Involves setting a low price for a length of time to drive competitors out of the market.

Competition based pricing definition

When businesses price their goods in line with competitors pricing.

Psychological pricing definition

When prices are set at a level that matches what consumers may expect to pay.

Promotion definition

The process of communicating with customers and other parties with the aim of creating a positive image for the business that gains and retains customers.

Above the line promotion definition and examples

Refers to generally untargeted, massive campaigns to raise brand awareness and reach more people. e.g. television, radio, newspaper, billboards, magazines

Below the line promotion definition and examples

Targets consumers directly. these are often used to support above-the-line promotion e.g. personal selling, sales promotion, direct mailing

Distribution channel

The route taken by a product as it goes from the manufacturer or producer to the ultimate/final consumer.

Traditional distribution channel

Producer > wholesaler > Retailer > Consumer

Modern distribution channel

Producer > Retailer > Consumer

Direct distribution channel

Producer > Consumer

Impact of using wholesalers

Wholesalers can reduce costs and improve efficiency by buying in bulk, allowing producers to reach a larger market without needing to manage multiple retail outlets.

Impact of using retailers

Retailers can provide greater market access and customer service by acting as a convenient point of sale for consumers, allowing producers to focus on product development and manufacturing.

Multichannel distribution definition

A marketing strategy that uses multiple channels to reach customers, including direct sales, wholesalers, and retailers, to enhance customer engagement and broaden market reach.

Digital marketing definition

The use of any form of electronic communication for sharing ideas, content, information and messages to improve communications with customers.

E-tailing definition

A from of electronic commerce which allows consumers to directly buy goods or services from a seller over the internet

M-commerce definition

The buying and selling of goods and services through wireless handheld device such as mobile phones