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Chapter 20: Marketing - Coggle Diagram

- - - - Develop a marketing strategy and marketing plan
      - Market Research
      - Formulate the Marketing Mix (Product, Price, Place & Promotion A.K.A 4P's)
- - - - Conduct a SWOT analysis
        
        Identify its internal strengths and weaknesses which are usually internally within the business, and identify its external opportunities and threats which are usually in the external markets
      - Market Segmentation
        
        Decide on a market at which it will target its product
      - Research the Target Market
        
        Find out the needs and wants of consumers in this market
      - Develop the 4 P's
        
        Based on the analysis of the target market, the business can develop the marketing mix, Ensures usus the most appropriate product, price, place and promotion to persuade consumers
    - - Business Goals
        
        Helps the business to focus on achieving its goals, This can mean that the business achieves these goals more effectively and efficently
      - Finanace
        
        Marketing shows potential investors that the business has conducted an in-depth analysis of the market
      - Benchmarking
        
        Help benchmark planned performance against actual performance.
        E.G Sales in a new market are lower then anticipated the firm can take corrective action
- - - - Market is divided into segments based on common factors such as age, gender, in come and occupation, Eg Brown Thomas department stores are targeted at higher income earners, Nike leggings are aimed at young teenage girls
    - - Market is segmented to aim at people beliefs, attitudes, social status and lifestyles. Environmentalist's aim to buy products that are environmentally friendly
    - - The market is divided into different geographic areas or zones Eg, Country, Country or province, all have regional local newspapers
  - - - Provides a product that meets the needs of the target market, can increase consumer loyalty and boosts firm's sales and profits
    - - Established brands can make it difficult for a new firm to enter the market, market segmentation enables the firm to focus on a smaller section of the market and allows for growth over time
    - - The business does not waste time or money trying to sell to different target markets. Instead it focuses its marketing message on a smaller market but can do so more frequently
- - - - Advantages
        
        Less Competition
        
        Less competition in a niche market, as other businesses focus on the largest general markets
        
        Consumer Loyalty
        
        Consumers are loyal to the good and service that satisfy their specific needs in a niche market
        
        New Products
        
        Businesses selling in a niche market may be able to launch a new products into the market more easily. Loyalty to the brand make consumers more likely to try the new products
      - Disadvantages
        
        Economies of Scale
        
        Businesses might not benefit from economies of scale as it produces goods in smaller quantities. EG May not receive discounts from suppliers as it does not buy raw materials in large bulks
        
        Competition
        
        Large competitors enter the market and the smaller businesses may be unable to compete on price. May lose out to larger established businesses
        
        Growth
        
        As Niche markets tend to be small, the business may find it difficult to grown, profit margins are much lower
- - - - Good or service provided by a business to satisfy consumers needs and wants. All products should have a USP (Unique Selling Point) so that is stands out from its competition. EG in 2023 TaylorMade released a new driver which claimed FARgiveness which was its USP, Some brands only sell one type of product (Michelin) other businesses sell a range of products (Samsung)
      - Product element contains a number of distinct areas, including Product Design, Brand Name, Packaging & Product Life Cycle
        
        Product Design
        
        Designing a product, a business should carefully consider the
        
        Function
        
        The product should be sit for purpose and do what it was marketed to do and comply with all relevant safety standards. (Sale of Goods and Supply of Services Act 1980)
        
        Materials
        
        The business identify the needed materials and where to source them, they should be ethically sourced and minimize environmental damage
        
        Manufacturing
        
        The business should find out if the product can be made and where it can be manufactured
        
        Appearance
        
        Product should be attractive to consumers in terms of shape, colour and image
        
        Costs
        
        Business should take into account the cost of manufacturing and distributing the product it must be able to charge a price that suits the target market but also these costs an make a profit
        
        Impact of Good Product Design
        
        Increased Sales
        
        Well-designed products are visually appealing and easy for consumers to use. Gives the product a competitive advantage
        
        Lower Costs
        
        There is less wastage of raw materials when products are well designed. there are also fewer consumers complaints about faulty of underperforming products
        
        Brand Name
        
        In order to increase consumer recognition of a firm's name and its product.
        To enhance the brand name, many firms also develop a brand logo: images, words or shapes used to identify a brands good or service.
        Firm's may also develop a brand slogan, a catchy, memorable phrase.
        "Have a break-have a KitKat"
        "Eat Fresh"-Subway
        
        Trademark
        
        A busniess can register words, letters and numbers that distinguis its identity and products from those of its competitiors.
        Registering a trademark with the Irish Patent Office prevents other businesses or firs using it without permission
        
        Advantages of a Brand Name for business and consumers
        
        Advantages For Business
        
        Recognition
        
        A brand name makes a product recognizable and consumers can distinguish the product from those of its competitors
        E.G Volkswagon, Ford ETC
        
        New Products
        
        Consumers are more likely to try new products from a recognized brand
        
        Higher Price
        
        Consumers associate brand names with higher quality. Enables firms to charge higher prices
        E.G Nespresso, Lindt, Puma & Gucci
        
        Consumer Loyalty
        
        Consumers can become loyal to a particular brand. Even if the price increases.
        E.G Kellogg's
        
        Advantages for Consumers
        
        Consumer Image
        
        Consumers may purchase certain brands to enhance their self-image.
        E.G BMW Drivers are perceived to be more successful
        
        Benefits of the Product
        
        Brands can communicate the benefits that the product will bring when used
        E.G Wash and Go Shampoo
        
        Reduces Disappointment
        
        Consumers buy familiar brands as they believe that they will not be disappointed with the purchase product
        E.G Mc Donald's all over the world is similar no matter what you know what your gonna get
        
        High-quality Products
        
        Consumers benefit from high-quality products as branded businesses tend to invest in RnD.
        E.G Dyson
        
        Own-Brand Products
        
        These are products that are sold by retailers under the retailer's name and logo. Often referred to as private labels'.
        Supermarkets such as Supervalu and Tesco have their own branded products.
        E.G Tesco=Tescos Finest & Tesco Value
        SuperValu=Daily Basics & Signatures Tastes range
        
        Advantages & Disadvantages of Own-Brand products
        
        Advantages
        
        4 more items...
        
        Disadvantages
        
        4 more items...
        
        Packaging
        
        It's the consumers first interaction with a product. Important that it not only looks attractive but also performs
        
        Product Protection
        
        Packaging should protect the product from damage when in transport from producer to the consumer
        
        Image
        
        The colour, shape, and text used on the packaging can portray a particular image for a product. Can persuade consumers to buy
        
        Convenience
        
        Product packaging should be designed in a way that is convenient for consumers to use.
        E.G Maltesers mini bags for children & Large pouches for gifts
        
        Information
        
        Packaging provides useful information such as nutritional content and how to dispose of correctly
        
        Recognition
        
        Attractive packaging that is well designed increases consumers recognition of the product.
        E.G Nike Swoosh, Toblerones Pyramidal peaks E.T.C
        
        Product Life Cycle
        
        The product life cycle describes the stages that a product goes through from introduction to decline.
        5 Stages include Introduction, Growth, Maturity, Saturation & Decline
        
        Introduction
        
        Sales are low as the product is launched on the market, invests in promotion. The business may have a negative cash flow and may not make profits at this stage.
        
        Growth
        
        Sales increase and the business invests in production to keep up with consumers demand. Production costs begin to fall as the business begins to benefit from economics of scale
        
        Maturity
        
        Sales and profits reach their peak and the business will have a positive cash flow. Competitors enter the market and the business may need to increase ads or us special offers
        
        Saturation
        
        Sales and cash flow being to slow down as consumers have purchased the product from the business or competitors. Firm may need to reduce the price to extend the product shelf life.
        
        Decline
        
        Sales and profits decline and the business must decide whether it will continue to sell the product or retire it. The business has negative cash flow.
        
        Extending the product life cycle
        
        As sales begin to fall, the business must decide whether to retire the product or find ways to maintain or increase sales. If they choose to try extend the life cycle it must change some aspects of the marketing mix
        
        Product
        
        It could improve the product by introducing new features. May also re-brand the image of the product.
        E.G TV3 re branded to Virgin Media TV
        
        Price
        
        A change in the pricing strategy can reach a new target market
        E.G Price drop to attract new consumers
        
        Place
        
        The business could change where the product is sold in order to reach a larger target market,
        E.G Foreign markets or online markets.
        
        Promotion
        
        A new ad campaign could be used,
        E.G Instagram or Facebook,
        Could also introduce a new sales promotion to increase demand
        E.G Vouchers or loyalty cards
    - - Price relates to the amount of money consumers pay for the product offered by a business
      - Price Strategies
        
        The business must be aware that the price charged could influence sales and consumers perception of the product. There are a number of strategies that a business can use when setting prices
        
        Low Price Strategies
        
        Penetration Pricing
        
        The business sets a price lower then that of its competitors' products in order to gain a greater market share of the market quickly. Overtime the business may increase the the prices
        
        Predatory Pricing
        
        A business sets a lower price then that of its competitors products to push them out of the market, this may cause a price war
        E.G Airlines such as Aer Lingus and Ryanair on popular flight destinations
        
        Loss Leaders
        
        The business sells a product below the cost price i.e a lower price then it paid to buy or manufacture the item.
        E.G Aldi's Super 6 offer
        
        High Price Strategies
        
        Premium Pricing
        
        The business charges a higher price then its competitors in the market, Gives impression that the product is of superior quality.
        E.G Designer Brands Chanel Gucci
        
        Price Skimming
        
        A high price is charged when the product is launched so that the business can recover R&D costs. quickly before competitors enter the market.
        E.G Samsung Note 9 sold for 1,000+
        
        Other Pricing Strategies
        
        Psychological Pricing
        
        The strategy is based on the theory that certain prices have a bigger psychological impact on consumers. Gets to pay on emotion
        E.G £.99 sounds like a better deal then 4 or 99 cent sounds better then 1 euro
        
        Price discrimination
        
        Different segments if the market are charged different prices for same product.
        E.G Student and OAP Deals, Children Prices compared to adult prices
        
        Bundle Pricing
        
        Business sells multiple items together for a lower price then they would cost separately. Can be effective for slow moving stock. Gives impression that they are getting value for money.
        Sky TV bundles that includes broadband WIFI and often times added extras such as Netflix
      - Factors influencing price
        
        Cost
        
        The price charged to customers should cover the firm's costs, which include production, marketing & distribution
        
        Competitors' Price
        
        Firms must consider the prices charged by competitors in the market. Needs to decide rather to set higher, lower or same
        
        Product life cycle stage
        
        The different stages of the product life cycle influence the price charged.
        E.G Price skimming may be used at launch OR Price reduction at decline
        
        Product Image
        
        The pricing strategy chosen should reflect the image of the product
        E.G Premium pricing is used to show its a quality brand
        
        Consumer Demand
        
        Higher demand can enable the business to charge higher prices
        E.G Summer holidays Or concerts drive up hotel prices
    - - Place refers to where consumers can buy goods and services sold by the business. To reach the largest possible number of consumers, The business must choose the most appropriate channel of distribution
      - 4 Channels of distribution
        Channel 1: Producer----Wholesaler----Retailer----Consumer
        Channel 2: Producer----Retailer----Consumer
        Channel 3: Producer----Agent----Consumer
        Channel 4; Producer----Consumer
        
        Channel 1
        
        Producer sells to the wholesaler in large quantities. Whole saler then "Breaks Bulk" i.e distribute smaller quantities to retailers. Consumers then purchase from retailers.
        E.G Grocery Items, Musgraves receives big bulk and distribute to centra and SuperValu
        
        Channel 2