Marketing

Revision for marketing

Purpose of market reserch

• Identify what customers want.

• Identify gaps in the market (market niches)

• New business opportunities

• Reduce the risk associated with a business Idea.

• Make informed business decisions

• Retain competitive advantage.

Two types of reserch

• Primary

• Secondary

Primary research (+examples)

Obtaining data first hand by the business to match the specific needs of the business. Examples include:

1. survey

2. questionnaire

3. focus group

4. observation

Secondary research (+examples)

Secondary research includes data from other sources Examples include:

• MINTEL

• internet market reports

• national government reports.

Advantage and disadvantage of primary research

• Advantage: accurate to the business

• Disadvantage: more expensive, takes time

Advantage and disadvantage of secondary research

• Advantage: cheaper, faster

• Disadvantage: Less accurate for the business

Quatitative data

numerical and can be analysed statistically

Qualitative data

comes from interviews and in-depth studies, where the information gathered cannot easily be converted to data

Market segmentation

when the market is put into seperate sections - it helps businesses see what consumer they are looking for

different market segments

1. location

2. demographics

3. lifestyle

4. income

5. age

Product life cycle

1. development

2. introduction

3. growth

4. maturity

5. (product extension)

6. decline

Product life cycle (as a graph)

Extensions strategies

1. lowering prices

2. advertising

3. enhancing the product

4. re-packaging

5. repositioning the product into a different market segment

Boston matrix

Boston Matrix:The Boston Matrix, also known as the Growth-Share Matrix, is a strategic planning tool that categorizes a company's products into four quadrants based on market growth rate and market share. It classifies products as stars, cash cows, question marks, or dogs to guide resource allocation decisions.

Boston matrix (image)

Pricing strategies businesses use

• Penetration pricing

• Price skimming

• Cost-plus pricing

• Competitive pricing

• Promotional pricing

Penetration pricing

pricing at a low level close to average total cost or below average total cost to allow the product to build market share. It is usually used for new products that have just entered the market.

Price skimming

normally be used when the product has significant USPs/differentiation and the product can be priced at a high level with a large profit margin

Cost-plus pricing

adding a percentage mark-up on to the average total cost of the product. This is a simple pricing strategy that does not take the market into consideration

Competitive pricing

used in markets where there is lots of competition. It involves low prices with small profit margins since to price at a higher level would involve loss of sales to competitors.

Promotional pricing

short-term discounts to the price of the product to try and encourage initial sales or increase sales for a specific period of time

Types of promotion

1. advertising

2. sponsorship

3. product trials

4. special offers

5. branding