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Edexcel AS Business Studies Unit 2 Revision
- 1. Scholar Virtual Academy
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EDEXCEL
AS Business Studies
REVISION
by Apsara Sumanasiri
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 2. AS Business Studies
Unit 2
Section 1
Marketing Plan
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 3. Marketing objectives
& Strategy
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 4. What is marketing?
Marketing is the management process
that is responsible for identifying,
anticipating and satisfying customer
requirements profitably
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 5. What is marketing?
Customer is KING!
If firms want to survive, they must satisfy
consumer wants.
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 6. The role of marketing
The main purpose of marketing is to
increase customer demand, i.e. to shift
the demand curve outwards.
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 7. The role of marketing
The marketing department does not
work in isolation.
The objectives of the marketing
department must fit in with the
objectives of the business.
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 8. Marketing objectives
Possible marketing objectives could be:
• To increase sales
• To create brand loyalty
• To develop the product range
• To survive in the market
• To change the market position
• To increase Market Share
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 9. What determines marketing
objectives
External factors: Internal factors:
• Customer behaviour • Market Research
• Competitor Findings
behaviour • Forecasted Sales
• The economy • Forecasted Profits
• Technology • Availability of
• Government Finance
• Changes in the law
• Suppliers
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 10. Forming a marketing strategy
A marketing strategy is designed to
achieve the marketing objectives.
The marketing strategy should consider:
• The target market
• The marketing mix
• The strategy of the business
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 11. Mass Vs. Niche Marketing
A niche market:
A mass market:
• Targets a very small
• Appeals to the
segment of a
whole market
market
• Requires high sales
• Sales will be lower,
volume and low
but prices will be
prices
higher
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 12. The marketing mix
The marketing mix
in said to consist of
the 4 key elements
needed for
successful
marketing, often
referred to as the
4 Ps.
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 13. Marketing Mix
* Product *
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 14. The marketing Mix - Product
Developing new products is time
consuming and businesses will want to
protect their new products and ideas
(intellectual property). This can be done
through:
• Patents
• Copyrights
• Trademarks
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 15. Product Life Cycle
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 16. Product Life Cycle
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 17. Product Life Cycle
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 18. Managing a product portfolio
A product portfolio refers to a range of products produced by a
company or brand.
A portfolio can be managed using a product life cycle approach
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 19. How useful is the product life
cycle?
The product lifecycle is important to find
the approach on the other factors of the
marketing mix, however:
• It’s impossible to tell how long a product
is going to last and therefore identify
where on the PLC the product is.
• It’s of little use to tertiary sector businesses
• Less effective for firms with a large
product portfolio (eg. NOKIA)
• It only considers sales and profits
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 20. Boston Consultancy Group
Matrix
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 21. Boston Consultancy Group
Matrix
A portfolio of products or simply put, a
group of products can be analysed using
the Boston Matrix. This matrix categorises
the range of products that the business has
into one of four different types, Stars,
Problem child or question mark, Cash cow
and question mark.
This classification is done based on two
criteria ie. Market share and market
growth.
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 22. Boston Consultancy Group
Matrix
• Market share – refers to the proportion
of the total industry sales that a
particular product hold and thus looks
at whther the product being sold has a
low or high market share?
• Market growth – looks at whether the
numbers of potential customers in the
market growing or not?
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 23. Boston Consultancy Group
Matrix
Stars are high growth products
competing in markets where they are
strong compared with the competition.
Often Stars need heavy investment in
order to sustain the market share during
growth. Eventually growth will slow and,
assuming they keep their market share,
Stars will become Cash Cows
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 24. Boston Consultancy Group
Matrix
Question marks are products with low
market share operating in high growth
markets. These are typically new products
in the market. Therefore, would have low
mkt share togetherwith a high potential for
growth.. This suggests that they may need
substantial investment to grow market
share at the expense of larger competitors.
Management have to think hard about
“Question Marks” - which ones should they
invest in to help grow? Which ones should
they allow to fail or shrink?
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 25. Boston Consultancy Group
Matrix
Cash cows are low-growth products with a
high market share. These are mature,
successful products, thus have a high mkt
sh together with less growth potential due
to the products maturity in the mkt and
thus low potential to grow any futher..
these products need to be managed for
continued profit - so that they continue to
generate the strong cash flows that the
company needs. Thus, re-investment is very
important.
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 26. Boston Consultancy Group
Matrix
Unsurprisingly, the term “dogs” refers to
products that have a low market share
in unattractive, low-growth markets.
Dogs may generate enough cash to
break-even, but they are rarely, if ever,
worth investing in. Dogs are usually sold
or closed.
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 27. Marketing Mix
* Price *
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 28. Influences on price
• Demand and supply
• Market conditions
• Production costs
• Market structure
• Taxes and subsidies
• Business Objectives
• Marketing mix
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 29. Pricing strategies
Short-term pricing strategies
These are often used for promotional
reasons
• Penetration pricing
• Market skimming
• Discounts/Sales
• Loss leader
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 30. Pricing strategies
Long-term pricing strategies
• Demand-based
• Cost-based
• Competitor-based
• Psychological
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 31. Price Elasticity of Demand
PED shows the responsiveness of
quantity demanded to a change in
price. It can be calculated as:
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 32. Price Elasticity of Demand
PED is always negative, due to the inverse
relationship between price and quantity
demanded. Once the negative sign is
ignored there are three possible outcomes:
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 33. PED and total revenue
Price increase Price decrease
Demand elastic Revenue falls Revenue rises
Revenue remains Revenue remains
Unit elastic constant constant
Demand inelastic Revenue rises Revenue falls
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 34. Marketing Mix
* Place *
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 35. Good Luck
Hope you’re doing some effective revision…
Happy Revising!
Apsara
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy
- 36. For more details and revision material
contact:
Scholar Virtual Academy
Address : No 03, Daisy Villa Avenue, Bambalapitiya, Colombo 04
Tel : (94 11) 2553466 / 2593571
Email : applicationises@scholar.lk
Website : www.international-scholar.com
© 2013 by Apsara Sumanasiri. All rights reserved. | Edexcel AS Business Studies Unit 2 Revision on Scholar Virtual Academy