IGCSE Business Studies: The Marketing Mix

Marketing mix

A term used to describe all the activities which go into marketing a product or service . These activities are often summarized as the four Ps - product, price, place and promotion.

Persuasive advertising

Advertising or promotion which is trying to persuade the consumer that they really need the product and should buy it.

Brand image

An image or identity given to a product which gives it a personality of its own and distinguishes it from its competitors' brands.

Demonstrations

In the shop, there may be a special display of the product and customers can be shown how the product should be used.

Sales promotion

Incentives such as special offers or special deals aimed at consumers to achieve short term increases in sales.

Competitions

The packaging of a product may include an entry form which allows the customer to enter a competitions.

Packaging

The physical container or wrapping for a product. It is also used for promotion and selling appeal.

Unique selling point

The special feature of a product that differentiates it from the products of competitors.

Brand name

The unique name of a product that distinguishes it from other brands.

Producer goods

These are goods that are produced for other businesses to use. They are bought to help with the production process. Examples include lorries, machinery and components.

Consumer goods

These are goods which are consumed by people. They can be goods that do not last long, such as food and cleaning materials. Some goods last a relatively long time and give enjoyment over a long time, such as furniture and computers.

Consumer services

These are services that are produced for people. Examples include repairing cars, hairdressing and education.

Producer services

These are services that are produced to help other businesses. Examples include advertising, insurance and advertising agencies.

Promotion

This is how the product is advertised and ________. What types of advertising media will be used? It includes discounts that may be offered or any other types of sales promotion, such as money-off vouchers or free gifts.

Price

This is the _____ at which the product is sold. A comparison must be made with the ______ of the competitor's products. In the long run, the _____ should cover costs.

BOGOF

This is where multiple purchases are encouraged.

Product

This refers to the _______ itself - its design and quality. How does it compare with competitor's ________? What's the packaging like?

Full launch

Product development - step 6

Price reductions

Reduced prices in shops at specific times of the year and money-off coupons to be used when a product is next purchased.

Gifts

Sometimes small gifts are placed in the packaging of a product to encourage the consumer to buy it.

Set objectives

The advertising process - step 1

Decide the advertising budget

The advertising process - step 2

Create an advertising campaign

The advertising process - step 3

Select the media to use

The advertising process - step 4

Evaluate the effectiveness of the campaign

The advertising process - step 5

Cost-plus pricing

The cost of manufacturing the product plus a profit mark-up

Decide if the company will be able to sell enough

Product development - step 3

Marketing budget

A financial plan for the marketing of a product or product range for a specified period of time.

Price elasticity

A measure of the responsiveness of demand to a change in price.

Develop a prototype

Product development - step 4

After-sales service

Customers can be reassured that if the product goes wrong in the first few weeks after they have bought it, they will be able to return it and get it repaired with no additional charge.

Product life cycle

Describes the stage a product will pass through from its introduction through its growth until it is mature and then finally its decline.

Point-of-sale displays

Displays specific to the product in the place where the product is being sold.

Test the market

Product development - step 5

Free samples

Most commonly used with products like food. Can be handed out in the shop to encourage the customer to try the product and hopefully buy it.

Target audience

People who are potential buyers of a product or service

Generate ideas

Product development - step 1

Further research

Product development - step 2

Promotional pricing

When a product is sold at a very low price for a short period of time

Brand loyalty

When consumers keep buying the same brand again and again instead of choosing a competitor's brand.

Dynamic pricing

When customers are split into two or more groups and they are charged different prices for basically the same product or service because they have different demand levels.

Psychological pricing

When particular attention is paid to the effect that the price of a product will have upon customers' perceptions of the product

Penetration pricing

When the price is set lower than the competitors' prices in order to be able to enter a new market

Competitive pricing

When the product is priced in line with or just below competitors' prices to try to capture more of the market.

Price skimming

Where a high price is set for a new product on the market

Informative advertising

Where the emphasis of advertising or sales promotion is to give full information about the product