GCSEBusinessEdexcelRevision Notes2. Building a Business2.2 Making Marketing DecisionsUsing the Marketing Mix To Make Business Decisions

Using the Marketing Mix To Make Business Decisions (Edexcel GCSE Business)

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Steve Vorster

Written by: Steve Vorster

Reviewed by: Jenna Quinn

How the Elements of the Marketing Mix work Together

  • The interaction between the elements of the marketing mix is crucial for the success of any marketing campaign

  • A change in one element can have a significant impact on the others

  • The marketing mix will change as a product moves through different stages of its product life cycle (see sub topic 2.2.1)

How Changes to One Element Can Change the Entire Mix

Changes to the Product

Changes to the Price

  • The product/service is the heart of the marketing mix as it is what the customer is buying and all other elements are based on it

    • The product determines the price, the target audience, and the promotion strategy

  • If the product changes then all other elements of the mix will likely need to change

    • E.g. if a business decides to launch a premium version of its product, it may need to increase the price, target a different audience and use a different promotion strategy to reflect the new product's value

  • The price of a product is closely linked to its perceived brand value

    • If a product is priced too high it may be perceived as too expensive by the target audience leading to lower sales

    • If a product is priced too low it may be perceived as low quality leading to lower sales

  • Increasing the price may require changes to the promotion strategy which are aimed at convincing consumers of the products value

Changes to the Promotion

Changes to the Place

  • The promotion strategy can affect the price and distribution channels

    • E.g. If a business decides to launch a high-end promotion strategy, it may need to increase the price to reflect the product's value

  • The distribution/sales channels can affect the price and promotion strategy

    • E.g. if a business decides to use exclusive distribution channels, it may need to increase the price to reflect the exclusivity of the product

Using the Marketing Mix to Build Competitive Advantage

  • The marketing mix is a powerful tool that businesses can use to build a competitive advantage

  • Competitive advantage refers to the features of a business and its products that are perceived as superior to its rivals by customers

  • It is how a firm’s product is made both distinctive and defensible

    • Distinctive means that it is different from the competitors

    • Defensible means that the business can prevent competitors from copying it

1-1-3-competitive-advantage-of-a-product-or-service

Some of the main sources of competitive advantage

  • There are many ways a firm can gain competitive advantage including innovation, reputation (branding), and building strong relationships with stakeholders, adding value, differentiation, market segmentation and price leadership

  • Examples of the source of businesses competitive advantage include:

    • Quality e.g. Audi is well known for the exceptional quality of the finishing inside their cars

    • Delivery times e.g. Amazon Prime delivers products within 24 hours of ordering

    • Low Price e.g. Primark is considered to provide the best value/low price combination

    • Reliability e.g. Apple Macs have an excellent reputation for long life and reliability

    • Ethical stance e.g. Tony's Chocolonely only uses cocoa in their chocolate which is 100% free of slave/child production

    • Design e.g. Dyson vacuum cleaners stand out from the crowd with their original design

An integrated marketing mix

  • An integrated marketing mix is one which correctly combines each element in the best possible way

  • It can help to build a competitive advantage by creating a cohesive marketing strategy that resonates with customers and sets the business apart from its competitors

Nike Is an Example of Business With an Integrated Marketing Mix

Product

Price

  • The company's products are known for their high quality and innovative design 

  • This has helped to create a perception of exclusivity and quality

  • Nike's pricing strategy is focused on premium prices that reflect the value of the product 

  • This reinforces the brand's premium positioning

Promotion

Place

  • Nike's promotion strategy is focused on creating a unique brand image and messaging that resonates with its target audience 

  • E.g. The company's "Just Do It" campaign is focused on celebrating athleticism and determination

    • This aligns with the brand's reputation for being a leader in sports apparel

  • Nike's distribution strategy is focused on creating a seamless online and offline shopping experience

    • This makes it easy for customers to purchase the brand's products

Examiner Tips and Tricks

You should be able to discuss which element or elements of the marketing mix are critical in determining competitive advantage and be able to make judgements about which parts of the marketing mix are the most important in different business contexts.

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    Author
    Reviewer
    Steve Vorster

    Author: Steve Vorster

    Expertise: Economics & Business Subject Lead

    Steve has taught A Level, GCSE, IGCSE Business and Economics - as well as IBDP Economics and Business Management. He is an IBDP Examiner and IGCSE textbook author. His students regularly achieve 90-100% in their final exams. Steve has been the Assistant Head of Sixth Form for a school in Devon, and Head of Economics at the world's largest International school in Singapore. He loves to create resources which speed up student learning and are easily accessible by all.

    Jenna Quinn

    Author: Jenna Quinn

    Expertise: Head of New Subjects

    Jenna studied at Cardiff University before training to become a science teacher at the University of Bath specialising in Biology (although she loves teaching all three sciences at GCSE level!). Teaching is her passion, and with 10 years experience teaching across a wide range of specifications – from GCSE and A Level Biology in the UK to IGCSE and IB Biology internationally – she knows what is required to pass those Biology exams.