BTEC Business Level 3

1
BTEC Business Level 3

• Unit 3- Assignment 4
• P6, M3

2
Marketing Mix

• The marketing mix provides a frame work for
  developing a marketing plan. This includes
• Product
• Price
• Promotion
• Place

3
Product

• A product can be tangible and can be viewed in
  three different levels
• Level 1-the core product- the benefit of the
  product, e.g. To fill hunger, facilitate a
  journey
• Level 2 the actual product- the physical item,
  branding often supports the sale of this
• Level 3 the augmented product after sales
  service, warranties, deliveries

4
Product Range

• The business will change and update the product
  mix that it offers.
• If the range of products is too small a business
  could go out of business.
• The range is limited by the experience of the
  business and its resources

5
Product Life Cycle
Sales
introduction
maturity
Decline
growth
Time
6
Price

• To set the price of a product a business must
  determine the following factors
• Select the price objective- to survive, maximise
  profit, increase market share
• Determine demand- the higher the price the lower
  the demand
• Estimate costs- the prices should at least cover
  the costs
• Analyse the competitor costs, prices and offers
• Select a pricing strategy
• Select the final price.

7
Pricing Strategies

• Premium Pricing - the price is kept high to
  encourage customers to associate it with high
  quality.
• Penetration Pricing - the price is initially low
  to attract customers before the price rises.
• Economy Pricing - the price is low to encourage
  sales.
• Skim Pricing - when there is little competition
  the price is set high to raise profits, price is
  lowered as other competitors enter the market.
• Psychological Pricing- this is setting prices
  that rely on consumers emotive responses. E.g.
  designer product designer prices. 9.99 is less
  than 10.
• Captive Product Pricing-this is pricing
  strategies for products that are needed e.g.
  Tyres for a new car, blades for a new razor.
• Product Line Pricing different pricing for the
  same products at different price points- e.g.
  Technological products with different benefits.

8
Place

• This is about where the product is sold and how
  it is distributed. This can be indirect
  distribution or direct distribution.

Indirect Distribution
Direct Distribution
9
Promotion

• Promotion consists of the various methods of
  communicating with a businesss target audience.
• Promotion should inform, persuade and influence a
  consumer to purchase a product.
• Capture Attention
• Create Interest
• Generate Desire
• Call to Action.

10
Promotional Mix

• Advertising
• Sales promotion
• Personal selling
• Public relations

11
P6 M3

• P6- You will need to write an article about your
  a new product and the strategy that will be used
  for your new product. Make sure you have followed
  the correct layout for an article.
• Choose a new product and create a coherent
  strategy for the product- you must include a
  detailed plan and explain your choices.
• Product- Explain a detailed explanation of your
  product including the target audience, the USP
  and why your product will be a success.
• Promotion- explain the methods of advertising and
  promotion that you will use and explain your
  choices
• Pricing explain the pricing strategy that you
  will apply to your product and explain the
  reasons behind your choices
• Place- explain the types of distribution for your
  product- online, in store and which types of
  retailers will sell you product, explain the
  reasons behind your choices.
• Conclusion- Explain who your target audience is
  and justify the decisions you have made- why are
  your pricing and promotional mix suitable for
  your target audience.