Marketing Concepts and Strategies

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Questions and Answers

What is a corporate bond?

A bond backed by government assets

A type of asset that can be traded like stock

A written promise to repay borrowed money with interest (correct)

A loan given to the government

Which type of bond is secured by various assets of the issuing company?

Mortgage bond (correct)

Debenture bond

Registered bond

Convertible bond

What primary factor affects the interest rates of corporate bonds?

The stock performance of the company

Global market trends

The bond's maturity date

The financial health of the issuing company (correct)

What is the role of a registered bond?

It registers the bond in the owner's name Signup and view all the answers

Which type of bond can be exchanged for a specified number of shares of common stock?

Convertible bond Signup and view all the answers

What is the primary purpose of inventory management?

To minimize inventory costs Signup and view all the answers

Which activity is NOT part of the warehousing process?

Conducting market research Signup and view all the answers

What best describes a common carrier?

A transportation business accessible to all shippers Signup and view all the answers

What kind of costs are associated with holding inventory?

Insurance costs and storage space costs Signup and view all the answers

Which type of advertising focuses on increasing demand for all brands in a specific industry?

Primary-demand advertising Signup and view all the answers

What is the main difference between contract carriers and common carriers?

Contract carriers serve specific clients and have limited availability Signup and view all the answers

Which aspect does NOT represent a component of materials handling?

Inventory management strategies Signup and view all the answers

What is the main focus of order processing?

Receiving and filling customers' purchase orders Signup and view all the answers

What is the primary purpose of institutional advertising?

To enhance a business's image or reputation. Signup and view all the answers

Which step is NOT part of developing an advertising campaign?

Create a financial budget for production. Signup and view all the answers

Which element is NOT included in an advertising platform?

Target audience analysis. Signup and view all the answers

What is the primary goal of quantitative social media measurement?

Count numerical metrics related to social media. Signup and view all the answers

What type of media allows users to upload photos, videos, and podcasts?

Media sharing sites. Signup and view all the answers

Which of the following best describes sentiment analysis?

A method to categorize opinions and emotions. Signup and view all the answers

Which advertising stage involves determining the total money allocated for advertising?

Determine the advertising appropriation. Signup and view all the answers

What type of measurement would focus on the opinions about a brand instead of numerical data?

Qualitative social media measurement. Signup and view all the answers

What is the primary function of standardisation and grading in marketing?

To facilitate production, transportation, storage, and selling Signup and view all the answers

Which type of utility involves converting production inputs into finished products?

Form utility Signup and view all the answers

Which classification of consumer products requires minimal effort from buyers?

Convenience product Signup and view all the answers

What constitutes place utility in marketing?

The location where customers can buy products Signup and view all the answers

What is a key characteristic of specialty products?

Items with unique characteristics attracting a specific buyer group Signup and view all the answers

What does physical distribution primarily involve?

Efficient movement of products to users Signup and view all the answers

Which type of utility is represented by Christmas decorations sold months in advance?

Time utility Signup and view all the answers

What is a common risk faced in marketing that cannot be completely eliminated?

Product-liability lawsuits Signup and view all the answers

Which of the following is NOT typically a job title in the finance sector?

Sales manager Signup and view all the answers

What does trade credit allow businesses to do?

Extend payment terms for delivered goods Signup and view all the answers

Which characteristic is essential for professionals working in the finance area?

Expertise in both written and oral communication Signup and view all the answers

What advantage does a promissory note offer to a business extending credit?

It serves as a negotiable instrument. Signup and view all the answers

How do angel investors typically differ from venture capitalists?

They often emphasize business success over profits. Signup and view all the answers

Which of the following financial roles primarily focuses on analyzing data?

Financial analyst Signup and view all the answers

Which type of financing is characterized by a lack of immediate payment requirements after delivery?

Trade credit Signup and view all the answers

What is a primary benefit of venture capital for small businesses?

Equity or ownership stake in the business Signup and view all the answers

Study Notes

Standardisation and Grading

Standardisation and grading simplify production, transportation, storage and selling.
Standardisation sets uniform specs for products/services.
Grading classifies products by size and quality, usually through sorting.

Risk-Taking in Marketing

Despite good management and insurance, risk is inherent in marketing.
Examples of losses include bad debts, obsolescence, theft, and product liability suits.

Gathering Market Information

Market information is essential for all marketing decisions.

Utility: The Value Added by Marketing

Utility describes the ability of a good or service to satisfy a human need.
There are four types of utility:
- Form utility: Converting production inputs into finished products (e.g., raw materials into a phone).
- Place utility: Making a product available where customers want it (e.g., shoes shipped from a factory to a store).
- Time utility: Making a product available when customers want it (e.g., Christmas decorations available in October).
- Possession utility: Transferring product ownership to the buyer (e.g., a new car).

Consumer Product Classifications

There are three categories of consumer products:
- Convenience product: Inexpensive, frequently purchased items with minimal buyer effort (e.g., bread, petrol, newspapers).
- Shopping product: Items requiring significant planning and effort for purchase (e.g., appliances, bicycles, mobile phones).
- Specialty product: Items with unique characteristics, demanding significant purchasing effort (e.g., sports cars, original artwork).

Physical Distribution

Physical distribution encompasses activities related to efficient product movement from producer to user.
Key functions include:
- Inventory Management
- Order Processing
- Warehousing
- Materials Handling
- Transportation

Inventory Management

Inventory management aims to minimize inventory costs, including holding costs and stockout costs.
Holding costs: Expenses incurred for storing products until purchase or shipment (e.g., invested money, storage space, insurance, taxes).
Stockout costs: Lost sales due to out-of-stock items.

Order Processing

Order processing involves receiving and fulfilling customer purchase orders.

Warehousing

Activities involved in receiving, storing, and preparing goods for reshipment.
Includes:
- Receiving, identifying, sorting, and storing goods.
- Picking, assembling, and dispatching shipments.

Materials Handling

Physical handling of goods within warehouses and during transportation.
Unit loading: Combining smaller cartons, barrels, or boxes into one standard-size load for efficient movement.

Transportation

Shipment of products to customers.
Carrier: A business offering transportation services.
Common carrier: Services available to all shippers (e.g., railroads, airlines).
Contract carrier: Limited by law in the number of businesses served, not for the general public.
Private carrier: Owned and operated by the shipper.

Types of Advertising by Purpose

Primary-demand advertising: Increasing demand for all brands within a specific industry (e.g., South African Sugar Association).
Selective-demand (brand) advertising: Selling a particular brand of product, the most common type.
Institutional advertising: Enhancing a business's image or reputation (e.g., Telkom sponsoring the South African Olympic Team).

Major Steps in Developing an Advertising Campaign

Identify and analyze the target audience.
Define advertising objectives.
Create the advertising platform (key selling points or features).
Determine the advertising appropriation (total budget).
Develop the media plan (timetable and media choices).
Create the advertising message.
Execute the campaign.
Evaluate advertising effectiveness.

Media sharing sites: Platforms for uploading photos, videos, and podcasts.
Photo sharing: Telling compelling stories about products or services through postings on websites or social media.
Videos: Storytelling through video content (e.g., Mr Price Home DIY décor videos).
Podcasts: Digital audio or video files for online listening or viewing on various devices.

Quantitative social media measurement: Using numerical data, such as website visitors, fans, followers, leads, and new customers.
Key Performance Indicators (KPIs): Measures that track progress towards objectives.
Qualitative social media measurement: Assessing opinions and beliefs about a brand through sentiment analysis.
Sentiment analysis: Technological detection of moods, attitudes, and emotions expressed in social media.

Careers in Finance

Job titles include Chief Financial Officer, Financial Manager, Consumer Credit Officer, Financial Analyst, Financial Planner, Insurance Analyst, Investment Account Executive.
Finance professionals need honesty, strong finance/accounting/math backgrounds, computer skills, and excellent written and oral communication.

Sources of Unsecured Short-Term Financing

Trade Credit: Extended by a seller, often without interest, for delayed payment.
Promissory Notes Issued to Suppliers:
- A written promise to repay a sum with interest on a specified date.
- Legally binding and negotiable.

Venture Capital, Angel Investors, and Private Placements

Venture capital: Investment in small businesses with growth potential, typically in exchange for equity or ownership.
Angel investor: Provides financial backing for startups, often focused on helping the business succeed rather than maximizing profits.
Private placement: Direct sale of stock to institutions like insurance companies or pension funds.

Corporate Bonds

A company's written pledge to repay a specific amount with interest.
Interest rates vary based on the company's financial health.
Registered bond: Registered in the owner's name by the issuing company.
Maturity date: Repayment date for borrowed money.
Types of bonds:
- Debenture bond: Backed only by the company's reputation.
- Mortgage bond: Secured by the company's assets.
- Convertible bond: Can be exchanged for common stock at the owner's option.

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Description

This quiz covers key marketing concepts including standardisation, grading, risk-taking, and the importance of market information. Additionally, it explores the four types of utility that add value to goods and services in the marketplace. Test your knowledge and understanding of these essential marketing principles.