The product life cycle - if a product is in the decline stage, we can employ extension strategies such as changing packaging
The Boston matrix
Market shares?
total sales of a firm/total sales in the market x 100
Sales growth?
difference in sales (between years)/earliest year x 100 (a percentage change)
market growth?
difference in total market sales/earliest year x 100
market size?
sales/market share x 100
price elasticity of demand?
%change in demand/%change in price
income elasticity of demand?
%change in demand/%change in income
Marketing objectives
Market share
Brand loyalty
Market and sales growth
Market size
External factors on marketing decisions
Ethics
Social factors (trends)
Competition
Economic factors (interest rates)
Technology
Internal factors on marketing decisions
Finance available
Production capacity
Human resources, skills of the workforce
Nature of the product
Primary research
Research done by an organisation itself, specific to the business
Secondary research
Research already available on public domains, not specific to that business. Still useful e.g data from government about demographics.
Market mapping
A map where companies are placed on according to price and quality (e.g), allows businesses to spot gaps in the market and exploit this.
Sampling
The selection of a representative group. Can help make decisions such as types of promotion, target market and product design.
Random - each member of the population has an equal chance of taking part
Stratified - separates population into stratas reflecting the % of groups in the entire population.
Quota - separating people due to sharing common characteristics
3 types of marketing data
Correlations
Confidence intervals
Extrapolation
Correlations
Statistical technique to show the relationship between two co-variables, helps in forecasting sales etc.
Confidence intervals / margin of error
The plus or minus figure used to show the accuracy of results collected from sampling. Most common confidence interval = 95%. Likely to be affected by sample size, the smaller it is, the larger the margin of error will be. E.g using a confidence interval of 5 and 70% of the population said they liked eggs, it would range from 65% to 75%
Extrapolation
Analyses past performance of a variable such as sales and extends the trend into the future, not suitable in industries which are subject to rapid change e.g technology.
Using technology to gather and analyse data
Provides faster communication
Forecasting easier
Relies on the accuracy of the data
Market segmentation
dividing the market into sub-sections each with its own characteristics
Market targeting
Deciding which market segment a business wants to operate in
Depends on…
Nature of the product, competition and the consumer
Unique selling point, gives the business and product competitive advantage, differentiates from other products, important for homogeneous markets e.g chocolate bars
Pricing strategies
Skimming - setting price high, then lowering it. Good for new and innovative products.
Penetration - setting a low price to build market share, price gradually rises.
Price leadership - used for established products and firms which dominate the market
Price taking - setting price to the same as other products, common for small and medium sized businesses.
Promotion
Packaging, branding, personal selling, public relations (PR), ATL / BTL advertising.
Affected by ;
Stage in the product life cycle, finance available