BUSINESS – Marketing ( Marketing, Market Research, Marketing Mix – Product, price, promotion and place )
eg. membership card
market map, product life cycle
why would the business want to extend the growth/ maturity stage of a product?
-keep their market
-high sale, kick them off for more higher sales
-to earn more money
-it si cheaper to extend than introducing a new product
How to reach situation and then earn more?
– add new features
– joint ventures
– focus on different market segment, sell to different audience, different target market
– enter foreign market
Market map: analyse the market and find out competitions, product portfolio and product positioning.
1. market conditions – boom? shrink?
2. competition – high competition?
4. business objectives
5. your cost – product cost/ expenses
(always need to cover your cost)
Adjust the price depending on…
– is the product new/old to the market?
– price maker or price taker?
– price elasticity of demand of the product
1. percentages of sales
2. objective based budgeting
3. competition based budget
4. what the business can afford
(how large or successful the business is increasing over time)
5. incremental budgeting
( “add say 3% on last years promotion budget)
How would you know if your promotion is successful?
1. Sales performance before and after the promotion
2. Consumer awareness data
3. Consumer panels
4. Response rates to advertisement
5. Views, hits, shares
6. Market research/ focus groups
7. Awareness survey
Promotion mix – the combination of promotional techniques that a firm uses to sell a product
The mix of promotional methods used by businesses
It will usually contain mixture of ATL and BTL
Above the line
: a form of promotion that is undertaken by a business by paying for communication with consumers
– Tv Advert
– Social media Ads/ Web pages/ Web banners/ Internet/News papers/- Radio Announcement/magazine
Below the line
: promotion that is not a directly paid-for means of communication, but based on short-term incentives to purchase
– Emails (not spam)
– Printed Advert, promotions (cards, discounts etc)
– Telemarketing, Door to door, Face to face, personal selling
– Sponsorships,Sample, Trials, merchandising
Manufacturer to consumer
M to Retailer to C
M to whole sales to C
M to W to R to C
what to find out?
1. current market share percentage
2. needs of the target customer
3. competitors market share, number of competitor
4. projected demand
5. trends / fashion
6. demographic (population)
7. income, pricing and expectations
8. value of the market
9. do they like the product? pricing?
Why market research?
1. reduce risk of failure/ reduce risks
2. predict future demand changes
3. predicting demand can lead to making sales forecasts and targets
4. to examine the market and competitons for threats
5. to find out what customers really want and make changes
– focus groups
– telephone calls
– experiments / human observations
– online surveys, social media
Advantages of Primary research
1. more up to date, more relevant to your own product and specific
2. confidential, private
3. tailor your own questions
Disadvantages of Primary research
2. Time consuming
3. Inaccurate Feed-backs
4. requires more resources
– The internet
– Government publication documents
– news papers
– trade organizations
– internal company records
– other company records
– other company documents
(financial statement, sales reports and etc)
Advantages of secondary research
2. time effective
4. compare different sources
Disadvantages of secondary research
1. inaccuracy of data
2. may not be specific
3. incomplete information
4. maybe irrelevant/ outdated
Why are they used?
because company can’t interview every one
its very expensive and time consuming to do so
what is the risk of using a sample in market research?
3. unreliable (from using a poor sample)
SIMPLE RANDOM SAMPLING – equal chance of anyone in the population being picked
1. number of population
2. generate random numbers
3. seek out the chosen few
1.may select those not in the target group – could be anyone
2.sample sizes may need to be large to be representative
3.can be very expensive to seek everyone out
Surplus – as the price goes down, more people are purchasing it
Inverse – as price goes up, demand goes down
Demand is usually downward sloping because the cheaper the price, the more people will buy
Law of supply – price goes up, the amount of company who is going to supply goes up.
Supply is always upward slopping
higher the price the more supply aka more money
Supply : the amount of goods and services business are willing and able to supply at a given price level
Equilibrium : when demand meets supply
the crossover line – market equilibrium
Equilibrium means no surplus no shortage
Price equilibrium – Demand equals Supply
Main basis of segmentation
why choose mass?
– larger potential cusomters
– one unified strategy
why choose niche?
– less competitors
– loyal customers
> non-existence, making loss, heavy promotion cost, product isn’t well known yet
> Product is starting to be known, customer base is increasing, advertisement cost
> Highest peak of sales, can start to promote less, well known
> Decreasing, sales are falling, still making sales but more outflow
>Out of date, irrelevant
time scale : however long the product lasts
Use of product life cycle?
1. balanced product portfolio to know when to release products.
2. Help to inform marketing mix
3. Know how revenue will change over time
4. different products at different stages to keep the business moving
Makes the business have a lower PED