Non-price competition and marketing

A burger bar is running a children’s colouring competition. Young consumers can colour the paper placemat on their tray in the hope of winning a free ice cream.

This is an example of:

A a free sample

B a loss leader

C a point of sale promotion

D advertising

What is one of the ‘four Ps’ of the marketing mix?

A Penetration

B Place

C Planning

D Profit

An independent toy business is seeing fewer potential customers visit its shop.

Which change to its marketing mix may help the business solve this problem?

A Introduce price skimming across the full range of toys

B Offer free superhero stickers and badges to all visitors

C Reduce the number of ‘pre-school toy’ loss leaders offered

D Use digital distribution channels for outdoor toys

Text 1 J Sainsbury plc (Sainsbury’s)

Sainsbury’s is one of the UK’s largest supermarket chains. Sainsbury’s targets middle to high income customers nationally. Sainsbury’s is owned by shareholders who have limited liability.

The supermarket industry is very competitive, and marketing promotions are important. An example is Sainsbury’s price match against similar products sold by Aldi, one of its competitors. Sainsbury’s also spends a large proportion of its marketing budget on television advertising.

Developing new products is important to remain competitive, as customers are always looking for something new. Sainsbury’s uses market segmentation to support successful product development.

Sainsbury’s managers believe that good food should be accessible to everyone. They use primary market research to ensure the business develops products that meet the needs of its customers.

Explain one way that limited liability affects the owners of a company.

Explain three advantages for Sainsbury’s of using television to advertise its products.

Analyse one likely reason why Sainsbury’s uses market segmentation when developing new products.

Identify two primary market research methods.

Evaluate whether Sainsbury’s should use primary or secondary market research methods in the future.

DM plc manufactures canned drinks. The company’s main objective for the coming financial year is to increase its market share by 2%.

What would help the company achieve its objective?

A Increasing the cost of its canned drinks

B Increasing the number of retail outlets it supplies

C Increasing the price of its canned drinks

D Increasing the time it takes to process orders

Text 3

Walkers Snack Foods Ltd

Walkers Snack Foods Ltd (Walkers) manufactures well‑known snacks, including Walkers crisps, Quavers and Wotsits. The company has a market share of more than 50% of the UK potato snack market. The company aims to maintain its market share and to increase profitability.

Walkers uses different marketing strategies as the snacks move through the stages of the product life cycle. Flavours are regularly added to Walkers’ range of crisps, often trialling new flavours before launching them. Recent examples have included ‘fish & chips’ and ‘chicken burrito’ flavours.

Walkers have responded to concerns about healthy eating by adapting its product range, including:

• recipe changes to reduce added salt by 25% and saturated fats by up to 70%

• a reduction in bag size

• multipacks now containing 22 bags rather than 24, with no change in price.

These changes were supported by a marketing strategy which affected all elements of the marketing mix.

An independent market research company arranged focus groups in both 2017 and 2022 to look at healthy eating trends. It found that:

• 46% of people were concerned about healthy eating in 2017, compared with 60% in 2022.

• In 2022, 36% of people considered whether a snack was healthy before buying it.

• In 2017, 26% of people thought that snack companies were trying to produce more healthy products. By 2022 this figure had increased to 29%.

Identify one stage of the product life cycle.

Analyse two advantages for Walkers of trialling new products before launching them.

The marketing department at Walkers is considering a new promotion method for the Quavers brand and is considering either:

• advertising in national newspapers for a four‑week period, or

• running a prize competition.

Analyse one advantage for Walkers of each promotion method.

Advertising in national newspapers for a four‑week period

Prize competition

Recommend whether advertising in national newspapers or a prize competition would be the most appropriate promotion method for Walkers to use. Give a reason for your answer.

* Evaluate, with reference to the data in Text 3, whether Walkers’ marketing department

should consider introducing healthier products.

A furniture manufacturer’s marketing mix identifies:

A how to reduce risk when selling its furniture online

B the distribution channels for its tables and chairs

C the quantity of wood and materials to reorder

D which model of gaming chair customers prefer

Link to material: https://www.marketing91.com/marketing-mix-heinz. Item removed due to third party copyright restrictions

State two purposes of market research.

Explain three reasons why employee motivation is important for Heinz.

Analyse one benefit for Heinz of developing new products.

Heinz is launching a new range of healthy pasta products.

Analyse one benefit for Heinz of using radio to advertise the new range of products.

Analyse one benefit for Heinz of using its own website to advertise the new range of products.

Recommend whether advertising on the radio or on its own website would be the most appropriate method for Heinz to use when launching the new range of products. Give reasons for your answer.

A producer chooses to sell its goods to a wholesaler rather than to a retailer.

Which of the following is an advantage to the producer of including a wholesaler in its distribution channel?

A The producer is likely to be able to charge higher prices

B The producer will have a wider span of control

C The producer will have less competition

D The producer’s storage costs are likely to be lower