IGCSE Business 0450 - Unit 3.3 Marketing Mix

A business develops a new product mainly to:

• reduce all competition immediately
• meet changing customer needs and increase sales
• avoid all marketing costs
• guarantee customer loyalty

Which is most likely to be a cost of developing a new product?

• research and development spending
• instant higher market share
• greater customer loyalty
• free publicity

A likely benefit of successfully launching a new product is:

• lower customer awareness
• higher sales revenue
• less market research needed forever
• no need for promotion

A strong brand image often leads to:

• lower customer loyalty
• repeat purchases and stronger sales
• less recognition in the market
• customers ignoring quality

What is an important role of packaging?

• to stop all competitors entering the market
• to protect the product and attract customers
• to remove the need for branding
• to make promotion unnecessary

The introduction stage of the product life cycle is usually characterised by:

• high sales and many competitors
• low sales and heavy promotion
• falling sales and reduced demand
• stable demand for many years

During the growth stage of the product life cycle, a business is most likely to see:

• rising sales
• negative cash flow only
• the product being withdrawn
• no customer awareness

Which is an extension strategy for a product in the maturity stage?

• withdrawing the product immediately
• changing the packaging or adding a new feature
• stopping all promotion
• raising the price sharply with no reason

Why might promotion spending be high in the introduction stage?

• to create awareness of the new product
• because the product is already well known
• because demand is always inelastic
• to reduce the need for packaging

A business is most likely to use skimming pricing when the product is:

• new and different with limited competition
• old and declining
• sold in a very competitive market
• targeted only at bargain hunters