paper 2

• Why is it important to identify and satisfy customer needs in marketing?

  To be competitive, avoid costly mistakes, and increase sales
• What are the two stages of customer needs in marketing?

  • Identify customer needs through market research
  • Satisfy customer needs by adapting the marketing mix
• What is market segmentation?

  The process of dividing a market into smaller groups of consumers with similar needs and wants
• What are the main types of market segmentation?

  Location, income, demographics (age and gender)
• What is the purpose of market research?

  To determine demand, assess competition, and understand the target market
• What are the two main types of market research?

  Primary and secondary research
• What distinguishes qualitative research from quantitative research?

  Qualitative research involves words and deeper opinions, while quantitative research involves numbers
• What is the difference between primary and secondary research?

  Primary research is conducted by the researcher, while secondary research uses existing data
• What are the advantages and disadvantages of using surveys in market research?

  Surveys are easier to analyze but may lack depth
• What is a focus group in market research?

  A focus group is a small group of people providing qualitative feedback on a product or service
• What should be considered when conducting a focus group?

  Whether the participants are representative of the target market, time, and cost
• What is the difference between market size and market share?

  Market size is the potential number of customers, while market share is the percentage of the market a business has
• What are the four Ps of the marketing mix?

  Price, product, promotion, and place
• What does the law of demand state?

  If prices go up, demand goes down, and vice versa
• If a business increases its prices by 10% and demand only falls by 1%, what does this imply?

  The business may generate more revenue despite the decrease in demand
• What are the five pricing strategies in marketing?

  1. Price skimming
  2. Price penetration
  3. Competitive pricing
  4. Loss leader pricing
  5. Cost-plus pricing
• What is price skimming?

  Starting with a high price and reducing it over time
• What is a disadvantage of price skimming?

  It may alienate customers who are unwilling to pay a high initial price
• What is price penetration?

  Starting with a low price and increasing it over time
• What is competitive pricing?

  Setting prices around the same level as rivals
• What is loss leader pricing?

  Reducing prices to cost price or below to attract customers
• What is cost-plus pricing?

  Adding a markup based on the cost to achieve the price
• If a product costs £100 to make and has a markup of 20%, what is the selling price?

  $£120$
• What factors influence pricing strategy?

  Product life cycle stage, competition, and R&D costs
• What are the benefits of product development?

  Increased customer satisfaction, sales, market share, and improved brand image
• What are the risks involved in product development?

  High R&D costs and the possibility that customers may not like the new product
• What is product differentiation?

  Creating a product that is different from competitors, often with a unique selling point (USP)
• What are the benefits of product differentiation?

  Improved brand image, awareness, customer loyalty, and potentially reduced marketing costs
• What are the stages of the product life cycle?

  1. Research and Development (R&D)
  2. Introduction
  3. Growth
  4. Maturity
  5. Decline
• What happens during the R&D phase of the product life cycle?

  High market research and product development costs with no sales
• What characterizes the introduction phase of the product life cycle?

  Likely low sales, depending on initial brand awareness
• What occurs during the growth stage of the product life cycle?

  Sales increase, and more rivals may enter the market
• What is the maturity stage of the product life cycle?

  The peak of sales, sometimes referred to as market saturation
• What is the decline phase of the product life cycle?

  Sales are reducing, but not zero, and businesses may want to avoid this phase
• What are extension strategies in marketing?

  • Improve packaging
  • Add new or more features to the product
  • Reduce prices
• What should be considered when improving packaging as an extension strategy?

  Cost-effectiveness and its potential impact on sales
• What factors should be evaluated when adding new features to a product?

  The cost of the features and their appeal to the target market
• What is integrated marketing mix?

  The alignment and integration of all four Ps to work together effectively
• What should be considered when expanding into new geographical markets?

  Potential costs, logistics, and supplier pressures
• What types of advertising can be used in marketing?

  Billboards, magazines, internet, newspapers, and television