Marketing Mix and Product Life Cycle
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Questions and Answers

Which of the following best describes consumer goods?

  • Goods that are produced and sold by manufacturers
  • Products bought for business use
  • Intangible services offered exclusively to businesses
  • Physical goods or services bought for personal consumption (correct)

    • The decline stage of the product life cycle is characterized by increased sales revenue.

    False

    What is the first stage of the product life cycle?

    Research and Development (R&D)

    The _____ stage of the product life cycle involves intense competition as sales revenue peaks.

    <p>maturity</p> Signup and view all the answers

    Match the following stages of the product life cycle with their descriptions:

    <p>Launch = Introduced to the market, early adopters buy Growth = Sales revenue increases and market share expands Maturity = Sales plateau as growth slows Decline = Sales revenue decreases, leading to product withdrawal</p> Signup and view all the answers

    What advantage does a firm gain by being the first to market with a successful product?

    <p>First mover advantage (FMA)</p> Signup and view all the answers

    Extension strategies are used to shorten the product life cycle.

    <p>False</p> Signup and view all the answers

    List two types of products referenced in the content.

    <p>Consumer goods and producer goods</p> Signup and view all the answers

    Which of the following is NOT an extension strategy for lengthening a product's life cycle?

    <p>Increasing production costs</p> Signup and view all the answers

    Product differentiation strategies aim to make a product less competitive in the market.

    <p>False</p> Signup and view all the answers

    Name one factor that affects the price elasticity of demand.

    <p>Availability of substitutes</p> Signup and view all the answers

    A unique selling point (USP) helps a product _____ in the market.

    <p>stand out</p> Signup and view all the answers

    Match the following extension strategies with their descriptions:

    <p>Reducing price = Encourages more purchases by being more affordable New promotional strategies = Reinforces interest and sales Product enhancements = Attracts customers through improved features Expansion into new markets = Increases reach by entering new geographic areas</p> Signup and view all the answers

    What is the primary goal of extension strategies in marketing?

    <p>To lengthen the product life cycle</p> Signup and view all the answers

    Product enhancements can include repacking and special features.

    <p>True</p> Signup and view all the answers

    What does price elasticity of demand refer to?

    <p>The responsiveness of the quantity demanded to a change in price</p> Signup and view all the answers

    Which factor typically leads to a lower price elasticity of demand (PED)?

    <p>High fashion trends</p> Signup and view all the answers

    Products that are considered necessities tend to have higher price elasticity of demand.

    <p>False</p> Signup and view all the answers

    What does promotion aim to accomplish in the marketing mix?

    <p>Promotion aims to create customer interest, generate brand awareness, and differentiate the product from rivals.</p> Signup and view all the answers

    Highly durable products tend to have a __________ price elasticity of demand.

    <p>greater</p> Signup and view all the answers

    Match the following price elasticity factors with their examples:

    <p>Durability = Motor vehicles Necessity = Fuel Fashion = Trendy clothing Addiction = Tobacco products</p> Signup and view all the answers

    What is an example of a price setting strategy based on customer behavior?

    <p>Psychological pricing</p> Signup and view all the answers

    Higher customer awareness results from effective information promotion.

    <p>True</p> Signup and view all the answers

    Give one example of a marketing strategy that encourages demand for a product.

    <p>Offering discounts or special promotions.</p> Signup and view all the answers

    The demand for textbooks is generally __________ to price changes compared to the demand for entertainment like cinema tickets.

    <p>less sensitive</p> Signup and view all the answers

    Study Notes

    The Seven Ps of the Marketing Mix

    • The seven Ps are a crucial framework for marketing strategy. They encompass product, price, place, promotion, people, process, and physical evidence.
    • Without a product, other elements of the marketing mix are irrelevant.
    • Consumer goods are products bought for personal use. Examples include home appliances, furniture, food, drink, and home plants.
    • Producer goods are products purchased by businesses for their commercial use. Examples include machinery, tools, and office supplies.

    Product Life Cycle

    • The stages of the product life cycle include Research & Development, Launch, Growth, Maturity, and Decline.
    • Research & Development involves investigating, designing, and developing a product.
    • Launch introduces the product to the market, focusing on early adopters and advertising/promotion to build sales.
    • Growth is characterized by increasing sales revenue and market share. Competitors often enter the market during this stage.
    • Maturity sees slowing sales growth, and firms might use product differentiation or extension strategies to prolong the cycle.
    • Decline is characterized by decreasing sales revenue, potentially due to changing trends or technology obsolescence.

    Product Life Cycle - Extension Strategies

    • Extension strategies are used to prolong the life cycle of a product when its sales are declining or the market is saturated.
    • These strategies can include reducing prices, new promotion strategies, product enhancements (like new features or improved versions), expansion into new markets or overseas markets, or product differentiation—creating a unique selling point (USP)

    Branding

    • Branding is a marketing technique to give a product or business a unique name or identity.
    • The purpose of branding includes creating a unique identity, differentiating from competitors, building awareness and loyalty, and establishing a positive brand image.
    • A good brand name enhances an organization's reputation and often has a more significant influence on customer decisions than price.

    Price

    • Price is the value paid by a customer for a good or service. It covers production costs and allows the business to make a profit.
    • Cost-plus pricing adds a profit margin to production costs.
    • Penetration pricing sets a low initial price to enter a market and gain market share.
    • Loss-leader pricing features products sold below cost to attract customers and encourage related purchases.
    • Predatory pricing involves intentionally charging a very low price to damage competitors' sales.
    • Premium pricing sets high prices to reflect prestige or perceived value.
    • Dynamic pricing adjusts prices based on factors like demand and time.
    • Competitive pricing matches competitors' prices.
    • Contribution pricing factors in variable costs and fixed costs to determine the price point.
    • Price elasticity of demand measures the responsiveness of demand to price changes.

    Promotion

    • Promotion is how businesses inform customers about a product and persuade them to buy it.
    • Objectives of promotion include persuasion (creating interest), providing information (raising awareness), differentiation (making the product stand out), and fostering loyalty.
    • Above-the-line (ATL) promotion—independent mass media, including television, radio, billboards, and magazines.
    • Below-the-line (BTL) promotion—marketing directly at a targeted audience, which the company can control. Common examples include direct mail, public relations, sponsorships, in-store promotions, email marketing, and social media marketing.
    • Through-the-line (TTL) promotion combines ATL and BTL strategies.

    Place

    • Place in the marketing mix refers to the distribution channels.
    • The most convenient, cost-effective way and best possible time to deliver the product are crucial to this component.

    People

    • People relate to the importance of employee-customer relationships in service marketing.
    • Effective interactions between employees and customers significantly influence customer satisfaction.

    Process

    • Process is the operational way services are delivered or provided.
    • It includes steps like ordering, queuing systems, and dealing with complaints.

    Physical Evidence

    • Physical evidence refers to the tangible aspects of a service.
    • This can include the decor, atmosphere, and appearance of the service environment.

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    Related Documents

    Marketing Mix PDF

    Description

    This quiz explores the Seven Ps of the marketing mix, essential for crafting effective marketing strategies. It also covers the stages of the product life cycle, detailing how products evolve from development to decline. Test your knowledge on these crucial marketing concepts!

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