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The Marketing Mix (Marketing Chapter 3-4) (Product (Product life cycle:…

- - - - Elastic: Percentage change in demand is greater than price, meaning. 1-infinity
      - Inelastic: Percentage change in price is greater then change in demand, meaning changes in price will not have a large effect on demand. 0-1
      - Unitary: The percentage change in demand is equal to change in price, meaning any change in price will lead to an equal change in demand. 1
  - - - Mark-up pricing: Add a percentage to how much the product cost a business.
      - Target pricing: Setting a price that will give a required rate of return at a certain level of output
      - Full cost pricing: Setting a price by adding a fixed profit margin to unit cost.
      - Contribution cost: Setting a price based on variable costs in order to make a contribution towards fixed costs and profit.
      - Competition based pricing: A firm will set its prices upon the price set by its competitors.
    - - Penetration pricing: Setting a low price and increasing it over a period of time.
      - Market skimming: Setting a high price for a new product(differentiated) and lowering the price over a period of time.
      - Price discrimination: Charging groups of customers different prices, for the same product. E.g: Airlines charging different prices to different groups(business, first class, economy)
- - - - Above the line promotion uses media to inform. Cost, size of audience, profile of customers, the massage to be informed are all factors which determine which media to be used. Social media sites, tv, radio, newspaper, billboards are all possible advertising locations.
    - - Incentives in below the line promotion: price deals, loyalty reward programmes, money-off coupons, BOGOF, games and competitions.
- - - - Direct: No mark up or profit margin taken by other businesses. Producer has complete control. Quickest. Direct contact with customers
      - On intermediary: Retailers holds and pays cost for stock. Retailers are in convenient places for customers. Producers can focus on production.
      - Two intermediaries: Wholesaler buys in bulk from producer. Reduces stock holding costs. Wholesaler pays for transport.