314834
Description
Mind Map by ryangriscti, updated more than 1 year ago
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Created by ryangriscti
about 11 years ago
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Marketing
- Product Life Cycle
- 1) Development
- Market, Scientific Research etc.
- Market, Scientific Research etc.
- 2) Introduction
- Launched, advertising, sales promotion
- Launched, advertising, sales promotion
- 3) Growth
- When sales and profitability
increase until the product becomes
established
- When sales and profitability
increase until the product becomes
established
- 4) Maturity
- Sales at their peak,
promotion less important, try
to make it more widely
available, end of the phase
market becomes saturated
and there's no more room to
expand
- Sales at their peak,
promotion less important, try
to make it more widely
available, end of the phase
market becomes saturated
and there's no more room to
expand
- 5) Decline
- Sales fall as rival products takeover, product becomes obsolete
- Sales fall as rival products takeover, product becomes obsolete
- 1) Development
- Product - Product portfolios
- Range of different products that a business sells
- Most businesses will have these at
different stages of the product life
cycle giving them a balanced portfolio
- Most businesses will have these at
different stages of the product life
cycle giving them a balanced portfolio
- Extension strategies
- Making changes to the
design or offering
discounts on the price
- make profit for longer
- Takes away cash
from other parts of
the business
- make profit for longer
- Making changes to the
design or offering
discounts on the price
- May broaden portfolios to grow
- Adding products to an existing range
- e.g. Drinks company - new flavoured drink
- e.g. Drinks company - new flavoured drink
- Increasing range of products
- e.g. Drinks company - launch an ice lolly
- e.g. Drinks company - launch an ice lolly
- Adding products to an existing range
- Designing and producing more
products is known as
Diversification
- Reduces risk in decline of
product meaning theres less
threat on a firms prod
- Reduces risk in decline of
product meaning theres less
threat on a firms prod
- Range of different products that a business sells
- Price - Pricing Strategies
- Market-led pricing
- Used if the price of the
product helps decide
whether to buy it
- Used if the price of the
product helps decide
whether to buy it
- Penetration Pricing
- Firm charges a very
low price when the
product is new to get
lots of people
interested
- Firm charges a very
low price when the
product is new to get
lots of people
interested
- Loss leader pricing
- Price is set below cost - once
established will increase
- Happens with new consumer products where
existing products have brand loyalty e.g.
Magazines
- Happens with new consumer products where
existing products have brand loyalty e.g.
Magazines
- Price is set below cost - once
established will increase
- Price Skimming
- opposite of penetration
- Makes the product more
desirable to people with large
incomes
- When established, firm will lower
price to help it become a
mass-market product
- opposite of penetration
- Competitive Pricing
- Where the firm has to charge similar prices
to other firms
- Happens when there's a lot of choice and not much product differentiation e.g. Petrol
- Where the firm has to charge similar prices
to other firms
- Cost-Plus Pricing
- used if not in in price
competition with other
producers
- Mark-up
- Work out how much the product costs and
then add a percentage mark-up
- If the product costs £2 to make, and you want a 25% mark-up, you'd sell it for £2+25%=£2.50
- If the product costs £2 to make, and you want a 25% mark-up, you'd sell it for £2+25%=£2.50
- Work out how much the product costs and
then add a percentage mark-up
- Profit margin
- Work out how much the product
costs and increase by the
required profit margin
- If the product costs £2 to make, and you
want a 20% profit margin, this means that
£2 is 80% of your required selling price
- 80%=200p,
1%=200/80=2.5p,
100%=2.5px100=250p,
So you'd sell it for
£2.50
- 80%=200p,
1%=200/80=2.5p,
100%=2.5px100=250p,
So you'd sell it for
£2.50
- If the product costs £2 to make, and you
want a 20% profit margin, this means that
£2 is 80% of your required selling price
- Work out how much the product
costs and increase by the
required profit margin
- used if not in in price
competition with other
producers
- Market-led pricing
- Promotion
- Sales promotion
- Discounts
- Product trials
- Invite people to test out products for free
- Invite people to test out products for free
- Free gifts
- By 1 Get 1 Free
- Point of sale
- Front row of shelves, window displays etc.
- Front row of shelves, window displays etc.
- Use of credit
- Buy now, pay later
- Buy now, pay later
- Competitons
- Discounts
- Direct marketing
- 1) The business contacts the potential customer directly
- e.g. mail out vouchers
- e.g. mail out vouchers
- 2) The customer is invited to make a direct response
- e.g. use voucher when next shopping
- e.g. use voucher when next shopping
- 3) benefit is that the business can measure its success
- 4) The problem is that it creates junk mail and spam
- Some people can't stand this
- Some people can't stand this
- 1) The business contacts the potential customer directly
- Sponsorship
- 1) Sport
- Brand name on competitions
- Brand name on competitions
- 2) TV
- Shows sponsored by brands
- Shows sponsored by brands
- 3) The Arts
- Some short of money -
businesses step in making them
look classy
- Some short of money -
businesses step in making them
look classy
- Create a high profile
- Thing sponsoring gets bad publicity -
looks bad on the business
- Thing sponsoring gets bad publicity -
looks bad on the business
- 1) Sport
- Sales promotion
- Place
- Distribution channels can be direct or indirect
- 1) MANUFACTURER - WHOLESALER - CONSUMER
- 2) MANUFACTURER - WHOLESALER - RETAILER - CONSUMER
- Good for manufacturer as they can
buy in bulk and the wholesaler
takes on the cost of storing them
and risk of not selling them
- Good for manufacturer as they can
buy in bulk and the wholesaler
takes on the cost of storing them
and risk of not selling them
- 3) MANUFACTURER - RETAILER - CONSUMER
- Faster than dealing with retailers through
wholesalers and manufacturer gets better
consumer feedback - harder for small retailers
to avoid holding onto lots of stock
- Faster than dealing with retailers through
wholesalers and manufacturer gets better
consumer feedback - harder for small retailers
to avoid holding onto lots of stock
- 4) MANUFACTURER - CONSUMER
- Fastest and often cheapest for the consumer - Customer service level may not be as good
- Fastest and often cheapest for the consumer - Customer service level may not be as good
- Distribution channels can be direct or indirect
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