Define Horizontal Integration

Answer explanation

Horizontal expansion supposes merging with companies that are in the same industry and at the same stage of the supply chain. These can be competitors, suppliers, or companies that produce similar goods or services. Mostly, businesses choose this approach to increase market share, reduce competition, and achieve economies of scale. 

Disney and Pixar merge is a perfect example of horizontal integration. Disney purchased Pixar back in 2006. Since then, the companies have featured a competitive rise as they integrated their capabilities and bundled technologies, gained greater market power, and now provide higher quality.  

In 2012, Facebook merged with Instagram horizontally and grew its revenue significantly. This way, Facebook acquired a competitor while growing bigger and getting more capabilities.

Define Vertical Integration

Answer explanation

Vertical integration is a strategy of integrating business with other businesses up or down the supply chain. The strategy is effective for greater control over the whole manufacturing process, timing, and all stages of development. Besides this, vertical integration has many advantages for business growth. 

A good example of vertical integration is Apple, which keeps controlling the whole manufacturing process. Having used to outsource producing some parts before, the company now manufactures basically everything: from chipsets to cases. This allows Apple to offer unique products, hard to counterfeit, keep client loyalty worldwide, and guarantee their products' high quality. 

What is a media conglomerate? Provide an example. [2]

Answer explanation

A media conglomerate is a large corporation that owns a large number of media companies, such as television, radio, internet, publishing – giving the conglomerate control in the market.

Briefly explain what is meant by distribution. [2]

Answer explanation

The methods by which media products are delivered to audiences, including the marketing campaign. These methods will depend upon the product (for example, distribution companies in the film industry organise the release of the films, as well as their promotion)

Define regulation [1]

Answer explanation

“Media regulation” refers to the process by which a range of specific, often legally binding, tools are applied to media systems and institutions to achieve established policy goals such as pluralism, diversity, competition, and freedom.

• Livingstone and Lunt argue that the interests of citizens and those of consumers cannot be easily reconciled. This suggests that there is an increasing tendency in recent UK regulation policy to place the interests of consumers above those of citizens. 

Identify two ways in which media organisations categorise audiences [2]

Answer explanation

Media producers categorise audiences in order to target their products more effectively. They often use a combination of demographic categories (e.g. age, ethnicity, gender, socio- economic group) and psychographic factors (e.g. interests, lifestyle and values).

Briefly explain the difference between a mass and a niche audience [2]

Answer explanation

A niche market refers to a smaller group of consumers who have specific and unique needs and wants. These consumers are often segmented based on demographics, interests, or other factors, and they are targeted with specialised marketing messages that speak directly to their interests and needs.

A mass audience is the traditional idea of the audience as one large, homogenous group.

Name a major studio that distributes films globally. [1]

Answer explanation

• DreamWorks Pictures.

• 20th Century Fox.

• The Weinstein Company.

• Warner Bros.

Give one example of an independent film company. [1]

Answer explanation

BBC Films

Wild Bunch

Sixteen Films

Why Not Productions

Identify two marketing methods used by the distributors of I, Daniel Blake. [2]

Answer explanation