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Homework answers / question archive / 1)what is product based marekting strategy list benefits dis agvantahes and what companies use this strategy what is customer based strategy list benefits dis agvantahes and what companies use this strategy 2)A firm finds that its price elasticity of demand is 4

1)what is product based marekting strategy list benefits dis agvantahes and what companies use this strategy what is customer based strategy list benefits dis agvantahes and what companies use this strategy 2)A firm finds that its price elasticity of demand is 4

Economics

1)what is product based marekting strategy list benefits dis agvantahes and what companies use this strategy what is customer based strategy list benefits dis agvantahes and what companies use this strategy

2)A firm finds that its price elasticity of demand is 4.0. Currently, the firm is selling 2000 units per month at $5 per unit. If it wishes to increases its quantity sold by 10%, it must lower its price by: a. $.40 b. 4.0% c. 2.5% d. $.50 James enjoys having either a peanut butter sandwich or a bologna sandwich for his lunch. A drop in the price of peanut butter increases the marginal utility per dollar of peanut butter and causes James to buy more peanut butter and less

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1)

PRODUCT BASED MARKETING STRATEGY

Product based marketing strategies focuses on products of companies rather than the consumer. It is generalley done by using SWOT analysis. Every company analyse their strength, weaknesses, opportunities and threats and decides either they create an distinctive product which a consumers can't resist to purchase or find ealsewhere or it must position products with universal demands more favourably than its competitors do.

BENEFITS:

1. The first and most important benefit of product based strategy is that a company can focus purely on their product which they can do best. they created this comapny solely to produce products and they are good at it. so they can channelise all their efforts in making the best product.

2. Focusing their attention on product, they can deliver quality products which can help in developing a favourable reputation in the market.

3. If a company spends money on the promotion of their products, they can create loyalty among customers because of the high quality and updated products.

DISADVANTAGES:

1.In today's world, customers are well educated and have various options available in market. They can freely buy what they want. If a company solely focus on their product and not customers they their market base can decrease due to dissatisfaction among customers.

2. Quality of product is important but to analyse whether that product matches with conumer's demands, is also important. it meand company have to deliver those quality products which are preferred by their target consumers. Otherwise they might fall behind in sales.

3. Comapny have to spend extra on promotion of their products if its demand is not adequate in their target market, which will eventually lead to increase in costs.

USAGE:

It is used by retail outlets and comapnies that wish to sell a large selection of merchandise to a large area of consumer market.

COMPANIES USING THIS METHOD

1.APPLE

2. AMAZON

3. PIXAR

CONSUMER BASED MARKETING STRATEGY

Consumer based marketing strategy focuses on indentification of their target consumer. this can be easily done through thorough market reasearch which enables a company to know whether their existing products are creating demands or they have to create a ne product according to their taste and preference, marketing mix helps in building a profile describing how to reach and engage those consumers.

Comapny initially study the various segments of market of potential consumers such as demographic segment like age, income, gender etc. Then they choose one or more segments to target and make a report of Four "P" i.e. price, product. promotion and place. And then they launch their product in its target market.

BENEFITS:

1. They create their products according to the customer"s need. So it can increase their sales volume.

2. In this competitive world, if a company launches only those products which are favourable and demanded in their target market, then they can have wide market area and consumer base would be high ad they can also have competitive advantage.

DISADVANTAGES:

1. The most important drawback is the cost. A comapny have to spend a lot of money on market research to understand their customers specifically for small businesses.

2. Other drawback can be the quality. It means company get so engrossed in meeting target market's demands they lack in quality of the product.

USAGE:

Those brands that manufacture or sell high end, specialised or products with otherwise limited marketability use this type of method to find just the right consumer.

COMPANIES USING THIS METHOD

1. SAMSUNG

2. DREAMWORKS

2)

C

Working note:

price elasticity of demand = % increase in quantity demanded / % decrease in price

4 = 10%/% decrease in price

% decrease in price = 10%/4

% decrease in price = 2.5%

So, correct answer is alternative C.