1.3 Marketing mix and strategy 1.3.5 Marketing strategy Theme 1: Marketing and people Can products be designed to make you happier? Http://www.bbc.co.uk/news/business-33312642 Products designed to make you happier... 1.3 Marketing mix and strategy 1.3.5 Marketing strategy Edexcel Business

Theme 1: Marketing & People This theme enables students to understand how businesses identify opportunities and to explore how businesses focus on developing a competitive advantage through interacting with customers. Students develop an understanding of how businesses need to adapt their marketing to operate in a dynamic business environment. This theme also considers people, exploring how businesses recruit, train, organise and motivate employees, as well as the role of enterprising individuals and leaders. 1.3 Marketing mix and strategy Subject content 1.3.5 Marketing strategy What students need to learn: a) The product life cycle b) Extension strategies: product promotion c) Boston Matrix and the product portfolio d) Marketing strategies appropriate for different types of market: mass markets niche markets business to business (B2B) and business to consumer (B2C) marketing e) Consumer behaviour – how businesses develop customer loyalty

Product Portfolio Analysis Allows you to make decisions with regards your company’s product mix ‘Analysing the existing product mix to help develop a balanced range of goods and services’

What is a product portfolio? What are the advantages to a firm of having a broad product portfolio? Are there any disadvantages? The range of products/services that a business offers

The Boston Matrix A method of analysing the products in a firm’s portfolio based on relative market share and market growth Recap. Define market share. Define market growth.

Boston Matrix

STARS Large market share of a high growth market Market leading products Fast growing Substantial profits e.g. the Playstation was a star when it was first introduced into the games market.

PROBLEM CHILDREN/ QUESTION MARK Might have future potential as they are in growth markets Need a lot of financing e.g. An example of a Question Mark could be a newly launched fashion item or a new car model.

e.g. cornflakes in the breakfast cereals market. CASH COWS Products that generate funds possibly to support other products Stable market share e.g. cornflakes in the breakfast cereals market.

DOGS Products that are in decline Cost disadvantage Markets are not growing A business wants to avoid any of its products being Dogs, although this may happen as technology, innovation and trends change. e.g. For example, DVD recorders have replaced video recorders which became Dogs for the electrical firms making them.

Draw a Boston matrix for Apple IPod IPad IPod shuffle IPhone 6 IPhone 2 Apple mac Apple watch

Boston Matrix Rising star Develops Problem child £ cross subsidises Becomes established Reinvents Cash cow Dog Exits

Can you explain any links between these two models? Product analysis Can you explain any links between these two models?

Discussion To what extent will simplifying its product range help Tesco to slow the decline in its sales? http://www.bbc.co.uk/news/business-33281659 Tesco: Every little is helping

Cadbury has a wide range of chocolate brands including Dairy Milk, Flake, Crunchie, Twirl and Fudge. It wishes to push its UK market share from 34 per cent to 38 per cent within the next two years. Evaluate the extent to which the Boston Matrixmight help in achieving this goal. Possible responses may include: l Analysing each product in their portfolio can help management to really think through the investment they should put into products to help fulfil their potential. l Cash cows might be left to rake in the cash. l Problem children should perhaps have more money invested in them as these have the potential to be the stars of the future. l Dogs might be discontinued if they are not making a contribution. Evaluation: l For a large business like Cadbury with a wide range of chocolate brands, the Boston Matrix might be useful in making strategic marketing decisions. However, while it may help to make marginal decisions, it is unlikely to be revolutionary. The goal is to increase UK market share from 34 to 38 per cent and the Boston Matrix should help Cadbury to achieve this goal – although is unlikely to be enough in itself.