Business AS level marketing
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- Created by: Hedgester
- Created on: 03-05-22 18:12
product life cycle(PLC)
the model that shows the pattern of development of every product life cycle - includes 5 stages
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development stage(PLC)
When there is a high cost and high risks as product has not been released so no profits are coming in. Lots of market research occurs, product made as a prototype
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introduction stage(PLC)
low sales as product just released, high cists in marketing and advertising, some profit but still covering greater costs of becoming established
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growth stage (PLC)
high marketing to grow to the highest point before maturity - reach highest potential
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maturity stage (PLC)
all companies want to prolong this stage - when sales and profits start to level
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decline stage
due to stages in buyers tastes and behaviour, competitors,
new products start to be produced to replace or improvement to current product
new products start to be produced to replace or improvement to current product
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Extension strategies are used to prolong the maturity stage, give 4 examples
new features added
software update
change price
promotional campaign
software update
change price
promotional campaign
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advantages of market research
allows for feedback from potential customers
primary source of information
alter and edit product before release
can be personalised
primary source of information
alter and edit product before release
can be personalised
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disadvantages of market reserach
could be limited or bias - not sample representatitve
expensive to carry out
depends on how and type of questions asked
general answers aren't specific enough
expensive to carry out
depends on how and type of questions asked
general answers aren't specific enough
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4 stages of boston matrix
star = high growth and market share - best stage
question mark = high growth but low market share
cash cow = low growth but high market share
dog = low growth and low market share - worst stage
question mark = high growth but low market share
cash cow = low growth but high market share
dog = low growth and low market share - worst stage
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what are the 4 P's
Price
place
promotion
product
place
promotion
product
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premium pricing
set prices higher than competitors as there is a higher demand
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loss leader pricing
product or service at a price that isn't profitable to encourage increased sales over profit
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price skimming
start at a high price as it is new to makret as people will pay
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competitive pricing
compare prices and match with competitors at the highest price
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cost-plus
work out all costs and add on percentage to make a profit
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penetration pricing
aim to attract buyers by offering lower prices on goods and services
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psychological pricing
increase the demand by creating an illusion of enhanced value for the customer
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predatory pricing - IS ILLEGAL
setting prices low in attempt to eliminate the competition
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define place in the 4P's
availability of the product and making sure it is in the right place for your customers to be able to buy it
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ways of getting products to customers and give examples
1) producer -> consumer (hairdresser - service)
2) producer -> retailer -> customer (amazon and caburys)
3) producer -> wholesaler(cosco) -> retailer -> customer (unilever)
2) producer -> retailer -> customer (amazon and caburys)
3) producer -> wholesaler(cosco) -> retailer -> customer (unilever)
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when is personal selling used as a promotional method
where the product comes with a range of features which needs to be developed or upsold
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when is direct marketing used as a promotional method
targeting mail based on what customers have brought before
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above the line advertising
involves mass media methods for targeting larger and more general customers
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below the line marketing
reaching a smaller market and more targeted
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public relations
public advertised and recommends to friends and family
long term strategy and is very low cost but gives company less control
long term strategy and is very low cost but gives company less control
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what is branding
a brand is a characteristic name or symbol that distinguishes ones product from another
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advantages of branding
branded product command higher price than non-branded
business can expect higher profits
good branding differentiates the products and creates customer loyalty
business can expect higher profits
good branding differentiates the products and creates customer loyalty
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disadvantages of branding
product branding may require high investment
may takes years to develop
limited flexibility when product tries to develop a new line in the range beyond what they are known for
may takes years to develop
limited flexibility when product tries to develop a new line in the range beyond what they are known for
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price elasticity definition
to what extent a change in price will affect the demand
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what does a number > or < -1 mean for price elasticity
< -1 means it is inelastic and price WON'T affect demand
> -1 means it is elastic and price WILL affect demand
> -1 means it is elastic and price WILL affect demand
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advantages of using the mass market
large scale production means economies of scale and lower average unit costs
mass marketing is straightforward and everyone equally targeted
large volumes of sales means higher revenues which can be used across the business
mass marketing is straightforward and everyone equally targeted
large volumes of sales means higher revenues which can be used across the business
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disadvantages of using the mass market
lots of competition
homogenous products need to be differentiated through marketing which can be expensive
high volume production may not be flexible enough to keep up with changes in demand
homogenous products need to be differentiated through marketing which can be expensive
high volume production may not be flexible enough to keep up with changes in demand
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advantages of using the niche market
can charge premium price
easier to taregt customers
small scale production can be flexible and follow trends
less competition
easier to taregt customers
small scale production can be flexible and follow trends
less competition
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disadvantages of using the niche market
very risky as demand may not be constant
higher unit costs as no economies of scales
higher unit costs as no economies of scales
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what is a dynamic market
one that is subject to rapid or continuous changes
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advantages of using online retailing
open 24/7 so wont miss any potential customers as constantly available
order can be taken automatically without staff
reach international markets
low overheads
stock can be easily withdrawn to keep up with updates in demand and market
easy to et p and fle
order can be taken automatically without staff
reach international markets
low overheads
stock can be easily withdrawn to keep up with updates in demand and market
easy to et p and fle
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disadvantages of using online retailing
issues with returning goods
issues with online security
very competitive market
need to have IT skills
issues with online security
very competitive market
need to have IT skills
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Other cards in this set
Card 2
Front
development stage(PLC)
Back
When there is a high cost and high risks as product has not been released so no profits are coming in. Lots of market research occurs, product made as a prototype
Card 3
Front
introduction stage(PLC)
Back
Card 4
Front
growth stage (PLC)
Back
Card 5
Front
maturity stage (PLC)
Back
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