The Marketing Mix

• What is the marketing mix?

  The combination of various marketing elements
• What are the elements of the marketing mix?

  • Product: Features, appearance, packaging
  • Price: Affected by costs, competition, demand
  • Place: Distribution decisions
  • Promotion: Methods to raise awareness
  • People: Staff in contact with customers
  • Process: Systems to deliver products/services
  • Physical evidence: Customer's physical environment
• How can a business create a competitive advantage through product?

  By adjusting features, appearance, and packaging
• What factors can affect a business's pricing strategy?

  Production costs, competition, and demand
• What does 'place' refer to in the marketing mix?

  Where to distribute a product
• What is the purpose of promotion in the marketing mix?

  To make customers aware of products/services
• Who does 'people' refer to in the marketing mix?

  Staff in contact with customers
• What does 'process' mean in the context of the marketing mix?

  Systems to deliver products/services to customers
• What is meant by 'physical evidence' in the marketing mix?

  The physical environment experienced by customers
• Why is the marketing mix important for businesses?

  • No single element is more important
  • Each element supports the others
  • Helps establish overall brand image
  • Creates unique selling points
• How do firms modify elements in the marketing mix?

  To establish brand image and unique selling points
• What is one element of the marketing mix?

  Price
• How can price impact sales?

  It can have an immediate impact on sales
• Why do shops have sales in January?

  To encourage customers to seek bargains
• What is often reported by the news regarding prices?

  Increases or significant decreases in prices
• How can an increase in global oil prices affect petrol prices?

  It may lead to higher fuel prices
• What factors should a business consider when setting a price?

  • Competition
  • Quality
  • Image
  • Production cost
  • Profit per unit
• What do customers consider when evaluating price?

  Whether the product is worth the price
• What are the three main pricing strategies mentioned?

  • High/premium price
  • Market/competitive price
  • Low/value price
• What does a high/premium price strategy signal?

  Luxury or quality of the product
• What is a potential drawback of a high price strategy?

  It may be difficult to attract price-sensitive customers
• What is the focus of a market/competitive pricing strategy?

  Setting prices at the same level as competitors
• What is the goal of a low/value price strategy?

  To attract customers by offering lower prices
• What perception might low prices create among customers?

  They may associate low prices with poor quality
• What is psychological pricing?

  Making customers perceive a price as lower
• How does cost-based pricing work?

  Calculating production cost plus desired profit
• If a cake costs £1 to make and a company wants a 50% profit, what is the selling price?

  £1.50
• What is penetration pricing used for?

  To enter a new market with lower prices
• How do train ticket prices vary?

  Based on peak and off-peak times
• What is destroyer/predatory pricing?

  Setting very low prices to eliminate competition
• Is destroyer pricing legal in the UK?

  No, it is illegal
• What is market skimming pricing?

  Launching a product at a high price
• What happens to the price in market skimming after initial sales?

  It is lowered to attract more customers
• What is the purpose of using loss leaders?

  To encourage customers to buy other items
• How do loss leaders affect customer loyalty?

  They may create customer loyalty
• What is the term for the distinct phases all products go through?

  Product life cycle
• What do all products share in their life cycle?

  A general pattern of growth and decline
• How do businesses use sales information related to the product life cycle?

  To adjust costs and prices
• What are the five stages of the product life cycle?

  1. Research and development
  2. Introduction
  3. Growth
  4. Maturity and saturation
  5. Decline
• What happens during the research and development stage?

  Prototypes are built and modified