Edexcel Business Studies AS Unit 2 Revision notes

HideShow resource information
  • Created by: Rachael
  • Created on: 12-04-13 01:48
Preview of Edexcel Business Studies AS Unit 2 Revision notes

First 470 words of the document:

Marketing Plan
Effective Marketing Objectives and Strategy
Effective marketing achieves the firm's sales and profit targets by convincing customers to buy the
firm's products again and again
Marketing objectives
Steer the direction of the business
Decision making will be more focused ­ Increase the probability of success
Achieving the marketing objective can help firm achieve its companywide objectives
Effective objectives should be quantifiable and measurable
o Increasing sales
If sales volume can be increased, the high fixed costs of operation will be spread
across a greater number of units of output, reducing fixed costs per unit. Lower
operation costs will widen its profit margin which gives the company the opportunity to
increase its research and development budgets, raising the likelihood of success for
its new investments.
o To enhance, or reposition a brand's image
Some brands become jaded due to changes in consumer tastes and lifestyles
Refreshing the brand image and can products relevant to the target market
Reposition: Occurs when a firm aims to change a brand's image, so that the brand
appeals to a new target market.
Important to have a clear objective ­ who is the new target market, how old
are they, which social class do they belong to, what is their lifestyle, etc.
Effective marketing strategy
Marketing strategy is the medium to long term plan for how to achieve your marketing objectives.
o Profitable ­ A proper balance between the firm's need for profit and the customer's need for
o Offensive ­ Get on the attack, leading the market, taking risks and force competitors to be
o Integrated ­ The marketing approach must flow through the whole company
o Strategic ­ Probing analysis of the market and your competitors leading to a winning strategy
o Effectively executed ­ Strong and disciplined teamwork in carrying the strategy through
Identifying the target market
Market segmentation
Market orientation
Identifying the right brand image
What is effective marketing?
Marketing is the business function that aims to identify, influence then satisfy consumer wants
In small businesses, owners are able to hear firsthand about the needs and wants of the target
In large businesses, formal research is undertaken to identify consumers' wants and needs,
designing of products and services to match consumers' preference and a launch of marketing mix
must be decided.
Why is effective marketing important?
In a competitive market, firms stand or fall according to their ability to satisfy the needs of consumers
o Firms that lack customer loyalty will lose market share and profit

Other pages in this set

Page 2

Preview of page 2

Here's a taster:

Firms with products and services that offer genuine consumer benefits will attract profit and
Competitiveness depends on: the ability to respond and adapt quickly to change in consumers taste
The characteristics of effective marketing
Identifying the target market
o Know and understand the customers within your target market
o Have a clear idea of the age, sex, personality and lifestyle of the target market
Focus market research
Interview those who make up the target market ­ more reliable findings
Clear definition of target market…read more

Page 3

Preview of page 3

Here's a taster:

Overreliance on targets and performancerelated pay can create a ruthless and dishonest
o Misselling inappropriate financial products to customers can improve a bank's profitability in
the short run ­ if the unethical marketing practices are exposed, the resulting wave of bad
publicity may hit demand for the firm's product
Issues for analysis
Good exam answers acknowledge that marketing is difficult because it is based on judgements
about the future ­ future competition, consumer tastes, consumer attitudes, etc.…read more

Page 4

Preview of page 4

Here's a taster:

Small firms are quicker to adapt so when large firms head towards their market, small firms might
still be able to win the competitive war
Issues for analysis
Analyse nichemarketing in relation to price elasticity ­ buyers of nichemarket goods are likely to be
less price sensitive than consumers of market brands since the products are unique and meet their
needs (especially for the originators of the unique product)
Highvolume, low profit margin operations (mass markets) or lowvolume, highprofit margin
businesses (niche markets)
o Dependent…read more

Page 5

Preview of page 5

Here's a taster:

Large budget ­ can implement any marketing strategy you want
However, even companies with large budgets cannot do everything as strong
advertising costs a bomb
Technology ­ long term success in marketing requires that firms keep up with changes and invest in
o With ecommerce (online purchasing), firms can make their products available worldwide
even if they only have a handful of retail outlets
Market research
o Usually only small firms can get direct feedback from their customers
o Medium large firms need primary…read more

Page 6

Preview of page 6

Here's a taster:

Growth: If the product succeeds, sales increase
o Maturity phase: At some point of time, sales will stabilise and sales growth slows down
Competitors may have introduced similar products or the market may have become
saturated (amount of product provided has been maximised in the current state of the
marketplace ­ households may not need 2 of the same product, once all households
have it, it is not needed)
o Decline: Sales fall
New technology means the product has become outdated
Competitors may have launched…read more

Page 7

Preview of page 7

Here's a taster:

The product life cycle and capacity
Link forecasted sales to plans for the firm's capacity
Cash flow and the product life cycle
Cash flow will only increase as it shifts from introduction to growth stage
Cash flow will only be positive as it shifts into the maturity stage
Careful budgeting required to avoid overspending
Extension strategies
Marketing strategies used to prevent a decline in the product's sales
o Targeting a new segment of market or a new geographic market
o Developing new uses for the…read more

Page 8

Preview of page 8

Here's a taster:

Issues for analysis
Portfolio analysis examines the position of all the firm's products and helps managers decide what to
do with each of them/ how to split marketing budget between each product ­ shows the firm's
current position within the market
o Managers must interpret their findings effectively and decide on the most effective course of
Managers must avoid letting these models become selffulfilling ­ attempt to influence the product
life cycle
Product life cycles are becoming shorter due to rapid developments in technology…read more

Page 9

Preview of page 9

Here's a taster:

Business success relies on building a distinctive market position and consumer image ­ the more
that patents, copyright and trademarks can help a firm to achieve this, the more secure it will
become compared with its rivals
In today's brandconscious and fashionconscious world, products and services are making greater
appeal to our senses as trademarks become more important
Importance of decisions about price
Price: The amount paid by the customer for a good or service
o One of the main links between the customer…read more

Page 10

Preview of page 10

Here's a taster:

Used when the product is innovative ­ it is new and there is no competition > able to
charge premium prices
High prices help establish the product as a musthave item
Early adopters (consumers with the wealth and personality to want to be the
first to get a new good) want exclusivity and are willing to pay high prices
Innovation can be expensive so high prices are reasonable to recover the
investment cost
If sales become stagnant the price can be lowered to attract…read more



God bless you lol


amazing notes. AMAZING!! Thank you so much


You little beauty :)

charlee chapman

perfect, a bit long but easy to cut down


Simply superb


God Bless Your Soul *w* 


Similar Business Studies resources:

See all Business Studies resources »See all resources »