3.3

• market growth is how much the total market sales increases and decreases
• market share is what percentage of the total market sales are our sales
• primary research is research done or commissioned by you

  secondary research is research done or commissioned by someone else, for someone else
• qualitative data is descriptive data and quantitative data in numerical data
• types of sampling

  random

  stratified

  quota
• ways or segmenting a market

  demographic

  income

  location
• 7P's

  product

  price

  place

  promotion

  physical appearance

  people

  process
• Boston Matrix

  low market share, low market growth - dog

  low market share, high market growth - problem child

  high market share, low market growth - cash cow

  high market share, high market growth - rising star
• product life cycle order

  research and development

  introduction

  growth

  maturity

  decline

  extension
• extension strategies

  add to or create new packaging

  add or remove features
• penetration pricing is setting a price initially low to get into the market
• price skimming is setting a price initially high when product is released usually for an extra feature. this allows to cover high research and development costs and gain a high market share
• dynamic pricing is changing the price depending on the market position
• Promotional mix

  Advertising

  PR

  Sponsorship

  Direct Marketing

  Sales promotion

  Personal selling
• Loss leader pricing is setting a low price on some products to get customers into the store to buy other full priced items
• Cost plus pricing is adding extra to cover costs or production and also gaining a profit on every sale
• Competitive pricing is basing your price off of competitors prices to maintain your market share in a highly competitive market
• Premium pricing is when the price is significantly higher than other products so customers perceive it of a better quality
• Location is chosen based on

  Convenience

  Accessibility

  Cost of access

  Reputation

  Localisation
• Traditional distribution channels

  Producer > agent > retailer > consumer

  Producer > company distribution centre > company retail outlet > consumer

  Producer > wholesaler > retailer > consumer
• Modern distribution channel

  Producer > retailer > consumer
• A direct distribution channel goes straight from producer to consumers
• Influences on price

  Market conditions

  Production costs

  Business objectives

  Market structure

  Marketing mix

  Taxes
• Price elasticity of demand is the measure of responsiveness of demand to changes in price
• Types of PED

  PED > 1 elastic demand

  PED < 1 inelastic demand

  PED = 1 unitary elastic demand
• Hot to add value to a product

  Provide a service

  Increase quality

  Add features and functions

  Increase brand reputation
• Factors influencing PED

  Brand strength

  Necessity

  Habit

  Availability of substitutes

  Time
• Factors affecting market growth

  Economic growth

  Nature of product

  Changes in taste

  Social changes

  Fashion
• Methods of research

  Questionnaire

  Interview

  Focus group
• Confidence intervals measure the probability that a population parameter will fall between 2 set values. Can take any number but usually 95% or 99%. It is the liklihood that the results we expect to happen, do happen
• External influences on marketing objectives

  Market conditions

  Competitors actions

  Technological changes

  Economic growth

  Interest rates

  Suppliers
• Types of primary research

  Focus groups

  Surveys

  Interviews

  Surveys

  Questionnaires
• Types of secondary research

  Newspapers

  Magazines

  Competitors

  Company records

  Market research organisations

  Internet

  Government publications
• Benefits of market mapping

  Helps identify closest competitors

  Helps identify gaps in the market the business can fill

  Help form understand how the public views them

  Help a business reposition itself in the market

  Shows overall competition in the market

  Assess popularity of products
• Drawbacks of market mapping

  Can oversimplify business position

  Subjective therefore potentially inaccurate or biased

  May fill a gap in the market but customers aren't interested in a product in that area
• Niche marketing is targeting a product or service at a small segment of larger market
• Advantages of niche marketing

  Less competition

  Lower costs

  Small scale production

  Specifically made products

  Targeting customers
• Advantages of mass marketing

  Large scale production

  High revenue

  Brand awareness

  Easier to pay for research and development costs
• Benefits of branding

  Increased demand

  Increased price

  Reduced competition

  Protection in recession and economic difficulties
• Wholesalers buy in bulk from the manufacturer and sell in smaller quantities to the retailer

  Help producers by purchasing their stock and storing it until consumers want it. Producers save on storage costs and have better cash flow

  Retailers benefit from lower delivery costs as wholesaler has stock from many different manufacturers