Lesson Objectives To understand that a focus on the needs of the customer is essential to business success. To recognise the main elements of the marketing mix. To be able to identify key elements of the marketing mix in different contexts

Starter activity Joe has just opened a new restaurant in York city centre. List the 3 MOST IMPORTANT things that Joe can do in order to make his business the most successful

A business must always remember that… The Consumer is King (or Queen) In order for a business to survive it must provide what the customer wants.

Businesses must understand what their customers wants from a product Identifying need Businesses must understand what their customers wants from a product Meeting Customers Needs Identifying and anticipating is not enough. Businesses must actually meet the needs of the customers Customer Focus Anticipating needs How will customers needs change? Businesses must anticipate how fashions and trends will alter customers needs

Task 1: Complete the table in your booklets. Explain, as a business person, why these three factors are important. You have 7 minutes

The Marketing Mix In order to meet customers needs, a business must: Sell them PRODUCTS that they want Charge a PRICE they are willing to pay Make them available in the right PLACE Make them aware by using PROMOTION These 4 elements are known as the “4 Ps of the marketing mix” PRODUCT PRICE PLACE PROMOTION

Place Products must be available to buy at locations convenient to customers. Examples include Online High Street Shopping centre Industrial Estate Catalogue Wholesaler The suitability of a location will depend on the product or service.

Jack’s Restaurant Jack has just opened a new Mexican Restaurant called Tequila

Task 2: In your booklets match the product to the location. Ensure you explain WHY you have made this decision You may match more than one product to the same location A/B Extension: Jack has opened his new restaurant in the middle of York City Centre. Justify why you think this is a good location for his business Remember for JUSTIFY questions you must analyse both sides of the argument.

Product Consumers often have lots of choices as to which products they can buy When you think of Baked Beans, which brand do you think of?

Product

Product Because the consumer has lots of choice, the business needs to make their product/service the one that people think of first. This can be done using different techniques

Specialised Versions To attract a new audience, Example: Coca Cola brought out Coke Zero to appeal to men, as Diet Coke was seen as too feminine Improvements “New Improved Flavour” Example: Herbal Essence shampoo recently brought out an advertising campaign to promote the new formula Changed Packaging To alter the brand image, or make the product look more current Example: When smarties went from being in a circular tube to a hexagonal tube New Technologies Used all the time with electronics Example: Retina displays on smart phones Widening the product range Branching out into other markets Example: A lot of chocolate bars are now drinks/milkshakes and yoghurts In your booklets write down your OWN definition of each of these strategies and come up with your OWN example

Task 3: Suggestions Jack’s restaurant sells authentic Mexican food such as fajitas, nachos, burritos and tacos. He wants to attract new customers. Using the strategies above, suggest ways in which Jack could alter his product in order to increase sales. A/A* - Suggestions for each strategy B – Suggestions for at least 4 C – Suggestions for at least 3

Promotion Promotion involves telling consumers about your products or services There are 5 main methods: Packaging Types of Promotion Advertising Must protect the product Right size and shape to allow stacking for distribution Have consumer appeal Create seasonal looks TV Radio Posters Billboards Newspapers Magazines Direct Mailing Sales Promotion Public Relations Also known as JUNK MAIL Involves sending mail to targeted customers Special Offers Price Discounts Vouchers Free gifts Prize Competitions Press Release Organising Sponsorships Damage Limitation

Task 4: Jack has found that business for his Mexican Restaurant is slow during the week. He wants you to suggest a way for him to boost business during a week day. In your booklets, suggest one way in which you think Jack could increase sales on a week day

Price Strategy Definition A product or service needs to be the right price in order to attract customers. Ways of ensuring this is called PRICING STRATEGIES Strategy Definition Advantages Disadvantages Cost-Plus Add % profit to the actual cost Ensures a profit is made May not be able to sell product! Charge a price similar to competitors Price will be competitive Price may not be profitable Competition Start with a low price to attract customers Encourages people to try Cannot last long Penetration Start with a high price for a unique product Allows extra profits to be made Only lasts while there is no competition Skimming Promotional Special price for a limited time Useful to get rid of old stock Only useful for a limited time

Price Must reflect the value placed on the product by customers A high price usually = high quality Determines how much entrepreneurs earn from their work. Price set must allow you to make a profit

The marketing Mix It is called a Mix because in order for a business to be successful it must have the right balance of Price, Product, Place and Promotion. It’s all about getting the mix right.

Exam style questions Why may customer focus be easier in a small business than a large one? Students must explain why it might be easier in the small business (1 mark) and why it might be more difficult in the bigger business (1 mark) “Customer focus might be easier in the small business because they are likely to have a smaller customer base, therefore recognising the customer needs will be easier. In a larger business there will be more customers therefore it will be harder to understand what they want on mass”

1 mark per explanation (max 2) Possible benefits Outline 2 possible benefits to Tesco from getting all their directors to spend one week a year as shop floor employees 1 mark per benefit (max 2) 1 mark per explanation (max 2) Possible benefits They can see what its like to work for Tesco, therefore understanding their employees needs more They experience it first hand, and can therefore identify weaknesses in the business They can talk to customers, and can therefore identify their needs

Identify the pros of selling in Superdrug (1 max) Explain pros (1 max) Superdrug wants to start selling Chanel products in their stores in the UK. Explain why Chanel might be right or wrong in trying to stop Superdrug selling its products. Justify your answer Identify the pros of selling in Superdrug (1 max) Explain pros (1 max) Identify the cons of selling in Superdrug (1 max) Explain the cons (1 marks) Justify your final decision (2 marks)