Business Booklet

Increasing Sales Volume is the process of selling more products over a specific period of time

Increasing Sales Value is the process of getting more revenue from each customers without spending more on marketing or advertising

Increasing Market Share means a company has a greater percentage of the market size than they originally had

Increasing Brand Loyalty is the process of persuading customers to make repeat sales

Sales Growth = Sales Increase / Total previous sales x 100

Market Growth = Market size now - market size previously / market size previously x 100

Market Share = Company’s sales / total market sales x 100

Market Size = Number of potential customers x average revenue spend per customer

Primary Market Research

Is the process of collecting data first-hand for your business

One example could include Focus groups

One Advantage is that the data is up to date and specific to business

One Disadvantage is that it can use a lot of the business’ resources

Secondary Market Research

Is the process of collecting data that already exists

One example is census data

One advantage is that its low cost and immediate

One disadvantage is that it might be specific to your business and competitors can use this data

Quantitative data is data given in numbers

Qualitative data is data given in words and sentences more in depth

Market Mapping is the of showing how a business’ products compares in a market

Sampling is the process of choosing a small group of people representing a larger population

Correlation is the link between two market factors

Extrapolation is the process of using previous market trends to predict future market trends

PED measures the how the change in price changes the demand for the product

PED = change in price % / change in demand %

Between - infinity and -1 PED is elastic and -1 and 0 PED is elastic

YED measures the change in consumer and how that changes the demand

YED = Change in demand / Change in consumer income

Between 0 and +1 demand is inelastic

Between +1 and infinity demand is elastic

0 and - infinity product is an inferior good

Market Segmentation is the process of dividing a market into distinct groups of consumers with similar needs or characteristics

How to segment a market - demographic, geographic, behavioural

Targeting is the process of selecting specific market segment to focus their marketing on

Marketing Mix refers to set of actions a company uses to promote its product

7p’s include place, people, physical, price, product, promotion process

Product Life Cycle

R&D

Introduction

Growth

Maturity

Decline

Product extension strategy is the process of trying to prolong the life cycle of a product by refreshing or modifying it

This could include: Product Modifications, Rebranding, New Markets, Price Adjustments, Advertising Campaigns and adding complementary products

Boston Matrix includes market growth and market share

It has four main areas dog, star ,cash cow and problem child

Factors Affecting pricing strategy:

Demand (higher demand will require higher price)

costs (Lower costs can allow price to drop)

product life cycle (could be used as a extension strategy)

Seasonal and timing (Christmas time could have higher prices)

Price Skimming is the process of starting a price high and then lowering over time

Penetration Pricing is starting a price low then upping it over time

Promotional Pricing is the process of company’s offering temporary discounts or incentive to entice customers

Promotional Methods:

Advertising

Public Relations

Merchandising

Sales Promotion

SMM

Brand loyalty

Digital Marketing is the process of using online channels to promote certain products

Some advantages may include global reach, cost-effective, targeted market and improved conversion rates

Disadvantages could include high competition, dependence on technology and security risks

Factors that could affect promotional strategy:

Target audience

Marketing Objectives

Budget

Market Conditions

Distribution is the process of transporting goods from manufacturer to consumer

Distribution channels is the flow the product takes from getting from manufacturer to consumer

Distribution Channels Include:

Manufacturer to consumer:

Pros:

• Lower costs as there as less intermediaries

• Higher profit Margins

• Faster market response

Cons:

• High investment as need warehouses and storage

• Logistics and fulfilment need to handle shipping

Manufacturer to Retailer to Consumer

Pros:

• Dont have to store the items retailer deal with logistics

• Wider Market reach

• Brand exposure

Cons:

• Have to pay for shelf space

• Dont have control on how product is presented

• Reduced profit margins

Manufacturer to Wholesaler to Retailer to Consumer

Pros:

• Less logistics

• Market expansion

• Efficient distribution

Cons:

• Less profit margins as more intermediaries

• Limited control

• Longer supply chains

Multi distribution channels refers to a strategy where a business sells its product through many different outlets and supply chains to reach more customers

Ecommerce is the process of buying and selling good online

Pros:

• 24/7

• global reach

• lower costs

Cons:

• high set up cost

• high competition

• security concerns

People refers to everyone involved in a business such as employees, customers

Process refers to the systems in place for a smooth transaction process for the business

Physical Environment refers to the design and layout of a store

Factors affecting marketing mix:

Target market

Competitors

Budget

Market trends

Technology

Objectives