Please enable JavaScript.

Coggle requires JavaScript to display documents.

2.2 - Coggle Diagram

- - - - Business can gain information about the product via market research to see whether would be viable.
  - - - Product growth is low / stable- so new product potential decreases.
  - - - Simple
        
        Lowering prices- Attracts more customers as the product is more accessible to more peoples' budgets
        
        Increasing advertising- Increases product exposure and perceived popularity, reminding consumers of the product and possibly regaining their interest
      - Complex
        
        Rebranding- The products' name, colours or associated brand image can be changed to attract different or more customers (e.g Burberry CHAV-->LUXURY)
        
        Introducing new varieties- Uses the products established image and updates it to modern ideas, making it more appealing to new or more customers (e.g Diary Milk Marvellous creations)
- - - - Perceived Value- If a product has a higher brand prestige and customers expect a high quality product then the business can charge more. (visa versa).
      - Cost to Manufacture- If a low quality product costs very little to produce then a business can set a lower price (visa versa).
      - Quality- Customers expect to pay a price which correlates to the perceived quality (e.g Gucci, higher price / H&M, lower price)
      - Brand Image/Prestige- If a business has a higher deseriablity then it can charge more for products / if a business is less well known then it will charge lower prices to increase awareness.
      - Demand of the product- If a product is in high demand and customers are not willing to wait then a business can charge a higher price to facilitate the common desire (e.g PS5)
  - - - If a business is exclusively E-commerce then there is no need for the business to hold retail outlets therefore the business can reduce its costs on Overheads.
      - If a business uses latest technology then cost of development is high. therefore the business would need to increase prices to accommodate.
      - "Freemium" strategy whereby a product is sold as free the most basic model yet then customers can pay extra for add-ons.
      - The business can flexibly alter its prices easily in responses to other factors.
    - - Price wars- whereby businesses compete on the lowest prices, introducing new promotions and reducing margins in order to remain lowest
    - - A business will charge a higher price depending on how premium a product is- If a business is focusing on a customers with a high salary
      - Visa versa is true
    - - Introduction- A product will be cheap and accessible to entice the most amount of potential new customers (increasing brand awareness)- free trials might also be sold.
      - Growth- A products price might increase slightly yet will still be low as sales grow rapidly
      - Maturity- Price increases as it is established and the consumers are willing to pay a certain price for the product.
      - Decline- Price might be reduced (as an extension strategy)
- - - - Free trials/trial offers
      - free samples
    - - Television
      - Radio
      - Digital
      - Print
      - Roadside/Door
- - - - Reduces prices for consumers as the less business' take commision and %s of the sales
      - More revenue is gained from each sale, without a 3rd party interfering and taking a cut
      - Consumers feel connected to the business and are able to show their loyalty
      - E-tailers sell to consumers exclusively online
    - - Via wholesalers and traders/ just wholesalers
        
        Allows the business to have a greater access to consumers as (e.g supermarkets) allow for established customers to view and try a new product (making a launch more successful)
        
        3rd parties take a cut, therefore either increasing prices or decreasing revenue per sale.
        
        Supplier (business)
        
        Wholesaler
        
        Retailer (e.g Supermarket)
        
        Consumer
        
        Supplier (business)
        
        Wholesaler
        
        Consumer
        
        More convenient for consumers as a large amount of products would be in a centralised place
  - - - Convenient as customers do not need to go to the store to purchase products, instead they can stay at home and browse goods
      - Convenient as stores are open 24/7
      - Prices are typically cheaper as a business would not need to pay overheads on retail premises therefore needing less revenue to make a profit.
      - Wider range of products and choice as they are less limited by immediate stock
      - Customers cannot pay cash and must wait for delivery
    - - Allow consumers to feel a sense of humanity speaking to real people and interacting with the store
        
        Specialist advice can be offered
      - Allow consumers to try on products (e.g clothes) or view items in person before a purchase
- - - - If a product is new to the market then it will need high amount of promotion in order to be recognised and for sales to start.
        
        Product
        
        If a product needs to be tried on (e.g shoes) then a physical store would be useful
        
        Place
        
        If price is high then a product would not be sold via a discount retailer
        
        Price
        
        1 more item...
        
        If a product is low/high quality then the price must reflect that
      - If a advertising campaign is completed in an area than it must be sold to consumers in that area (e.g international advertising, availability for international sales