AQA GCSE Marketing

The elements of the marketing mix
Price often influences purchasing decisions, so getting it right is important. Set

the price too high and consumers will not purchase. Set it too low and there is a
risk that the business will make losses.
Introduction to the marketing mix
The marketing mix is made up of the four Ps –
It is a marketing tool used to attract customers to a business, and all four

elements should be carefully considered in order for a business to be effective.
The right marketing mix should work well together and each element of the
marketing mix should complement the rest, for example the type of promotion
will be applicable to the product being sold by a business.
The most effective marketing mixes constantly adapt to the ever-changing

business environment. This could mean a business adapting their price,
adopting new types of promotion, updating their product or changing distribution
channels as required.
Each business has a different marketing mix. The choice of marketing mix will
depend on:
●
● competitors’ products
●
● business approach
Product
The product element refers to the the business sells.
Product development
When developing a new product, the business needs to think about the design, the
price, the expected sales and the cost of development and production. Businesses need
to change its products to keep up with changes in customer needs.
The stages of product development are generating an idea, the idea,

the product, trialling the product and launching the product.
Product differentiation
Businesses need to stand out from their competitors. This is known as product
differentiation. This can be done by:
● Building – advertising, celebrity endorsements and its logo

● having a unique selling point (USP)
Product portfolio
As businesses grow, so does the range of products that they sell. This collection of
products is called a . Businesses can manage their portfolio using
the Boston Matrix. There are four categories on the Boston Matrix, which measures a
product in terms of its and market growth.
● star – these products have market share in a -growth market
● cash cows – these products have market share in a -growth
market
● question marks – these products have a market share in a
-growth market
● dogs – these products have a market share in a -growth market
Product life cycle

The product life cycle shows the sales of a product from its development to its decline.
There are five stages of the product life cycle.
● Development – during this stage, the product is being and .

Costs are but there are no sales so therefore no revenue.
● Introduction – this is the launch of the product. The business spends money on
and starts to make sales and therefore revenue.
● Growth – during this stage, the product is becoming much more successful
and increase rapidly.
● Maturity – as the product reaches maturity, sales of the product begin to
● Decline – during this phase of the product life cycle, sales will start to .
The business needs to decide whether to invest money to try and boost sales
or to remove the product from sale.
Extension strategies
To prevent a product going into decline, a business can use an extension strategy.
There are lots of possibilities including:
●
●
● new packaging
● new features
Price
Price is the amount a business charges its customers for its product or service. Prices
are set according to how much a customer is .
Customers want value for money and this may mean a business needs to set low prices
to generate high levels of sales.
Price and demand
For most products, an increase in price will lead to a in demand. However, a

strong unique selling point (USP) or brand image can mean that demand isn’t strongly
affected by changes to the price.
Pricing methods
Companies can use different pricing methods depending on the product or service they
are selling.
There are five main strategies that businesses can use.
● price skimming – start with a price and then over time

● price penetration – start with a price and it over time
● competitive pricing – set a price to your competitors
● loss leader – selling one product at a loss so a customer has to buy additional
products that will generate a profit
● cost-plus – working out the cost of making a product and then
Factors that influence price include:
● costs – depending on the cost of making the product, the price will need to be
set to ensure they make a profit
● demand – if demand is low, a business may have to to
encourage people to buy the product
● degree of competition – a business may need to its prices to compete
with other businesses
● product life cycle – a business may charge a different price depending on the
stage of the product life cycle
● brand image – some products can have a price because customers
perceive the business’s brand as desirable
Place
Place refers to the used to get the products from the producer to the final
customer. The channel of distribution can include:
● producers – this is the maker of the product or service

● wholesalers – these businesses buy products and sell them in smaller
quantities to
● retailers – these are the shops that sell goods and service to the final customer
Distribution channels can be set up in a number of ways
● Producer → customer
● Producer → wholesaler → customer
● Producer → wholesaler → retailer → customer
Other distribution channels
● Mail order businesses do not have any stores, instead they send catalogues to
customers who then place orders.
● Some businesses sell their products . This is known as
telesales. Customers can phone the business to place an order or the
business can call potential customers to try and convince them to buy them.
● Some businesses sell their products on a website using . Some sell
via mobile devices, which is known as m-commerce.
Promotion
Promotion is the method a business uses to about its products and
services among its customers and potential customers. The main aim of promotion is to
either persuade customers to purchase or inform about products.
This includes advertising, sales promotion, public relations and personal selling.
Advertising
There are a number of advertising methods a business can use. These include:
●
● newspapers, magazines and billboards,
●
● radio
Public relations
A business can use public relations to increase and its products.
This is usually free media coverage such as for the opening of a new store or launch of
a new product.
Sales promotion
These strategies are used by a business to
Sales promotion techniques include:
●
●
● competitions and coupons
● point of sales displays
●
● free samples
Sponsorship
Businesses can increase the profile of the business by sponsoring sport events, sports
teams or television programmes.
Social media
Social media can be used by businesses to promote their products and services. This is
a cheap way to communicate with their customers about new products or special offers
and could be used to take customers to their website.
Personal selling
A business will use a mix of different promotion methods to increase its sales. Its
chosen method will depend on the type of product or service on offer, competitors’
actions, the target market, the relative costs of the different methods and the size of the
budget the business has. This is often referred to as the ‘promotional mix’ for a
business.
Balancing the marketing mix based on the

competitive environment
The term refers to the pressure placed on a business by its
competitors. Businesses that operate in a have a tough competitive
environment as there are many other businesses offering very similar products and
services. This means that if a business charges too much then its customers will go
elsewhere. An example of a business that operates in a mass market is the
industry.
Businesses adapt their marketing mix to try to convince customers that their product is
better than the products of their competition. The aim of these adaptations is to gain a
competitive advantage. They can do this by:
● offering a product or service that fills a gap in the market

● offering better sales promotions, such as buy one get one free (BOGOFF),
online discount codes or cashback
● creating a unique selling point (USP)
● with existing customers to make them more
likely to buy again
Technology
Technological advances create many opportunities for businesses. This means that a
business’ promotional mix may need to change to enable it to interact with its customers
through increasingly popular technologies (such as online messaging and digital
advertising).
The use of social media has changed how much many businesses spend on traditional
promotional activities (eg TV advertising) and on advertising in other media types (eg
newspapers). Sponsorship and influencers on social media are commonly used as a
means of promoting products and services.
Examples of ways businesses may adapt to advances and trends in technology include:
● increasing use of e-commerce and m-commerce in businesses

● use of digital media to promote products and maintain consumer interest
● changes to a product’s design to incorporate new technologies
● of prices because of more efficient production methods
● introduction of more competitive pricing because of easy access to price
comparisons across retailers
Questions
1. What is sponsorship and give an example of things that firms may sponsor. (4
marks)
2. Describe the four market-led pricing strategies. ( 4 marks)
3. What is an extension strategy and give an example. (2 marks)

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The elements of the marketing mix

Price often influences purchasing decisions, so getting it right is important. Set

Introduction to the marketing mix

The marketing mix is made up of the four Ps –

It is a marketing tool used to attract customers to a business, and all four

The most effective marketing mixes constantly adapt to the ever-changing

The stages of product development are generating an idea, the idea,

● Building – advertising, celebrity endorsements and its logo

Product life cycle

● Development – during this stage, the product is being and .

Price and demand

For most products, an increase in price will lead to a in demand. However, a

There are five main strategies that businesses can use.

● price skimming – start with a price and then over time

● producers – this is the maker of the product or service

Distribution channels can be set up in a number of ways

These strategies are used by a business to

Sales promotion techniques include:

Balancing the marketing mix based on the

● offering a product or service that fills a gap in the market

● increasing use of e-commerce and m-commerce in businesses

3. What is an extension strategy and give an example. (2 marks)

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