Revision for A2 Applied Business Exam

In a recent  study revision techniques examined turned out to be really effective  and these were testing yourself and spreading out your revision over time. Students who test themselves or try to retrieve material from their memory are going to learn that material better in the long run. Repeated testing means it will be in their long term memory, this is because the student is more engaged and it is harder for the mind to wander. When you get the correct answers it appears to produce a more elaborative memory trace connected with your prior knowledge, so you're building on what you know. 

However the best strategy is to plan ahead and not do all your revision on one subject in a block before moving on to the next - a technique called "distributed practice". You are much better doing ‘little and often’ - as this helps build on previous knowledge.

Revision Cards

Flash cards (or cue cards) are a good way to review subjects because you learn as you make the cards, then you have an excellent tool to test yourself from, over and over again, until you know the answers. They can be used for testing the meaning of key terminology - key term on one side and the definition on the other, or writing down an exam question on one side and summarise the main points on the other. Use different coloured cards for different subjects. Get your friends to test you. 

Revision notes

Things to focus on when practising:

Things to find out:

•How many papers will you sit? One. Sections A & C only.

•Do you know which topics will be covered in each paper? Do you have the syllabus for the exam?

•Do you know how many questions you will need to answer in each paper? Have you seen all of the past papers and mark schemes?

•Have you covered all the content?

•What are the different question types?

•How will questions be marked (point marked or level marked)

•What are the common mistakes which are made in each subject?

Complete all the past papers you can.

Welcome to A2 Applied Business & Sales Forecasting

A2 Applied Business

Starting the year as we mean to go on.......
Getting to know you:

In the following clip Michael Jordan explains what is the key to success.
What do you think he is going to say?

  

What characterises Jordan's attitude - and what can you learn from it?

We want our students to see learning as being about endurance, working hard, practising, and making mistakes - rather than being about natural ability.

How can Ronaldo add to this discussion?



How to get going with work

How to avoid procrastinating: Charlie explains why we procrastinate, and suggests ways to make ourselves more productive with our time:
Verb:procrastinate

Delay, put off doing something, postpone action, defer action, use delaying tactics, stall, play for time, play a waiting game, drag one's feet/heels,take one's time.

How to create and stick to new habits:

How to create habits that you stick to: in the following clip, Charlie explains how using Jerry Seinfeld's 'Don't break the chain' idea has helped him to create and stick to new habits:

Susan and Robert:


Understanding Plagiarism:

ABUS5 - Business Decision Making

5.1 Decision-making and the marketing function.



What is your definition of 'marketing'?

Noun: Marketing

The action or business of promoting and selling products or services, including market research and advertising.

Cadburys has a ‘brand manager’ for each product within its portfolio.

How many different Cadbury products can you think of?

Each brand manager will focus on the likely future sales of the product they are responsible for.

Imagine this was your role for Creme Eggs (with a £60,000 salary, at least.)

What are the implications for Cadbury of a changing sales forecast for the products they make?

A sales forecast will have an impact on:

1. Investment decisions.
2. The number and type of staff that are required.
3. The four Ps.

Methods of forecasting sales:

For a new product Test Marketing may be used.


For an existing product a 'moving average' is a good way to smooth out fluctuations in sales to allow for a prediction of future sales. This is technically known as time series analysis.

In the following video a Centred Moving Average is discussed. Your exam board does not expect you to take this extra step. We will discuss this in class.

Qualitative sales forecasting:

This may involve panel surveys (focus groups):

Or industry experts (the Delphi technique). A nice summary of this technique here.

Advantages and disadvantages of the Delphi technique. Details here.



Market Research

Methods of primary and secondary market research:

Primary research is the gathering of first-hand data that is specific to a firm's needs.
You could use: surveys or observation to collect information.

Secondary research is information collected from second-hand sources such as Google, reference books, government statistics or market intelligence reports.

Quantitative research means research using pre-set questions among a large enough sample size to provide statistically valid data.

An example would be using a questionnaire to question 200 people in a particular market segment.

Qualitative research is in-depth research into the motivations behind consumer behaviour or attitudes. It may include the use of focus groups.

My focus group:
Should a television company commission a programme where viewers send in video clips of food eating contests.



Sampling: choosing a group of respondents selected to be representative of the target market as a whole.

Excellent link: Click on the picture.

Sampling: Simple random, convenience, systematic, cluster, stratified:

Quota sampling:

The choice of sampling method and size of the sample will be influenced by:

-the finance available
-the nature of the product
-the risk involved
-the target market

What method of sampling and what sample size would you have used before bringing this product to market?

Niche and mass marketing:
Mass marketing is attempting to sell a product or service to the 'average' customer, the whole market.

Advantages:

Cost effective because of economies of scale, proven to work, a business can build a very powerful brand.

Colgate has 45% share of the world market for toothpaste.

Disadvantages: not personal, assumes everyones values, beliefs and needs are the same, lower profit margins.

Niche marketing: this involves targeting a product at a small, perhaps tiny segment of the market.

The A380 is the largest passenger plane in the world.

Imagine that you could afford to buy one.

How would you design the interior? 

Advantages of niche marketing:
Initially there is not that much competition.
It’s unlikely that large companies are going to focus their efforts on exploring such a small segment, so a small company can have real chances in becoming successful.
Being among the first in a specific area gives you a competitive advantage.
You can create highly personalised promotion that target your exact audience.

Disadvantages:
If the market is poorly targeted then potential clients will not know about the product or service.
If there are only a few potential customers the product or service may not be viable.
If the niche proves to be profitable then larger firms may move into the market.

Market segmentation - analysing a market to identify the different types of consumer. The main ways a market can be segmented are:

Demographically e.g. by age, social class or sex

Psychographically (by attitudes and tastes)

Geographically, by region.

My Blubbr game:
Click on the picture.

Market Segmentation

Perception:

A belief or opinion, often held by many people and based on how things seem.

Need:

To have to have something, or to want something very much.

Are perceptions always right?

Click on the picture:

What perceptions are being used here?



Perception / Need: Value or quality

The customer’s perception of the price charged is an important determinant of the final pricing decision. 

McDonalds classifies its products into 3 categories namely the branded affordability (BA), branded core value products (BCV) and premium (Pr).

Branded affordability:

Branded core value:

Premium:

How is this demonstrated on their website. Look here.

This has been done to satisfy consumers with different perceptions of the importance of price or quality.

Perception / Need: to eat a healthy diet
Click on the picture.

Are the following needs real or perceived?

Market Segmentation

McDonalds market segmentation in the US:

Mass marketing: here, the seller mass produces, mass distributes, and mass promotes one product to all buyers.  

In the very beginning, McDonald’s offered just one type of hamburger to everyone. 

Mass marketing leads to lowest costs and prices and create the largest potential market.

Product-variety marketing: here, the seller produces two or more products that have different features, styles, qualities, sizes…

McDonald’s produced the Big Mac to offer variety to buyers rather than appealing to different market segments. 

Product-variety marketing supports that consumers seek variety and change over time.

Target marketing: here, the seller identifies market segments, selects one or more of them, and develops products and marketing mixes for each. 

 Methods of market segmentation:

Companies may divide the market into different geographic units such as nations, countries, regions, cities…

A company may decide to operate in one or more geographic locations but it must pay attention to the geographical differences in needs and wants.

E.g. McDonald’s serve corn soup in Japan, pasta salads in Rome, wine in Paris...

http://www.mcdonalds.co.jp/ 

Demographics:

Age and life-cycle: needs and wants change with age, that is why, a company may use different marketing approaches for different age and life-cycle groups.

Gender

Income

Psychographic segmentation

This is based on lifestyle

Behavioural segmentation

Product Life Cycle

Marketing implications of each stage of the product life cycle - details here. You need to know this.

Extension strategies extend the life of the product before it goes into decline. Try clicking on the pictures.

Advertising – try to gain a new audience or remind the current audience.

Price reductions – making a product more attractive to customers.

Adding value – add new features to the current product, e.g. Spy phone app on mobile phones.

Explore new markets – try selling abroad.

New packaging – brightening up old packaging, or subtle changes such as putting crisps in foil packets.

Product life cycle multiple choice questions. Click on the picture:

Advantages and disadvantages of product life cycle theory. Details here.

Marketing Strategies for the Different Stages of the Product Life Cycle

Marketing strategies for the different stages of the product life cycle

Introduction

The need for immediate profit is not a pressure.

The product is promoted to create awareness and develop a market for the product.

The impact on the marketing mix and strategy is as follows:

·        Product branding and quality is established and intellectual property protection, such as patents and trademarks are obtained.

·        Pricing may be low (penetration pricing) to build market share rapidly or high skim pricing to recover development costs.

·       Distribution is not widespread until consumers (or retailers) show acceptance of the product.

·        Promotion is aimed at innovators and early adopters. 

    Marketing communications seeks to build product awareness and educate potential consumers about the product.

Growth

Competitors are attracted into the market with very similar offerings. In the growth stage, the firm seeks to build brand preference and increase market share.

·       Product quality is maintained and additional features and support services may be added.

·       Pricing is maintained as the firm enjoys increasing demand with some competition.

·       Distribution channels are added as demand increases and customers accept the product.

·       Promotion is aimed at a broader audience.

Maturity

Those products that survive the earlier stages tend to spend longest in this phase. At maturity, the strong growth in sales diminishes. Competition may appear with similar products. The primary objective at this point is to defend market share while maximising profit.

·       Product features may be enhanced to differentiate the product from that of competitors.

·       Pricing may be lower because of the new competition.

·       Distribution becomes more intensive, and incentives may be offered to sellers to encourage preference over competing products.

·       Promotion emphasises product differentiation.

Decline

At this point, there is a downturn in the market.

For example, more innovative products are introduced or consumer tastes have changed.

There is intense price cutting, and many more products are withdrawn from the market.

Profits can be improved by reducing marketing spending and cost cutting.

As sales decline, the firm has several options:

·      Maintain the product, possibly rejuvenating it by adding new features and finding new uses (Extension strategies).

·      Maintain the existing product–reduce costs and continue to offer it, possibly to a loyal niche segment.

·      Discontinue the product, liquidating remaining inventory or selling it to another firm that is willing to continue the product.

By imaginatively repositioning their products, companies can change how customers mentally categorise them.

They can rescue products struggling in the maturity phase of their life cycles and get them back to the growth phase.

And in some cases, they might be able take their new products forward straight into the growth phase. (Remember how the makers of Lucozade did this)

The disadvantage of using product life cycles to direct strategies:

According to Harvard Business School professor Youngme Moon, though the product life cycle concept has been used successfully over the past 40 years, it has made marketers assume that there is only one trajectory for successful products.

By viewing the product life cycle in the same way, marketers pursue similar positioning strategies for products and services during each stage of the life cycle.

In the process, they miss out on opportunities to differentiate themselves.