Edexcel Business A Level Revision

Ansoff Matrix - The Ansoff matrix is a famous strategic marketing planning tool that helps a business determine its product and market growth strategy. It suggests that a business's attempts to grow depends on whether it markets new or existing products in new or existing markets. MARKET PENETRATION A business might wish to pursue a strategy of market penetration targeting the same customer base in its current global markets.  To do this it will look at its EPG (Ethnocentric, Polycentric and Geocentric) marketing approach and decide where and how to invest. This will be dependent on the forecast return on investment from each market that it already operates in. It will look to see if it should continue its current approach e.g. ethnocentric or adapt it to meet the changing requirements of the marker e.g. to one of geocentricity.  MARKET DEVELOPMENT Global businesses will always be looking to pursue a strategy of new market development. As markets grow and disposable...

The changing competitive advantage  means that most markets are continually evolving, with businesses entering and leaving the market. In every market businesses are trying to keep at the cutting edge of product development and changes in customer tastes and fashions. The competitive environment or market structure involves all the external factors that either compete with  or have an impact on a business.  It is constantly changing, it is dynamic and a business that fails to monitor these changes and take action  runs the risk of losing market share or even failure. Direct competitors – Businesses are likely to have direct rivals who produce very similar products and  services, Domino competes directly with Papa John’s, Nationwide with Halifax, Asda with Tesco and so on.  They are competing for the same consumer and will try to find more effective ways of competing. Indirect competitors – are not direct rivals but they are competing for the sam...

The factors that influence the formation of corporate culture include: The founder of the business - For example the "Bill Gates way" or the "Alan Sugar way" may influence things years after the founder has left Size and development stage of the business - small businesses or start-ups may have a far more entrepreneurial culture than large multinationals. Leadership and management style Employee and management reward structures - For example, at John Lewis staff ('partners') all share in the business's profits The external environment, such as legal, economic or social factors - for example, at British Nuclear Fuels, which disposes of nuclear waste, the culture is based firmly on the very tight legal framework which governs how, where and when the company disposes of highly dangerous materials.

Short-termism - where a business prioritises its short term reward rather than long term rewards such as investment in research and development, staff or technology. Long-termism -  where a business is focused on sustained growth through building long term relationships with suppliers and other external stakeholders, significant investment in research and development, perhaps at the expense of shareholder returns/dividends in the short term, and meeting customer needs despite short term needs. SHORT-TERMISM Management who can be described as "SHORT-TERMIST" tend to emphasise certain performance measures, such as: Share price Revenue growth Gross & operating profit Unit costs & productivity Return on capital employed As a possible consequence, other more longer-term measures of business performance might become less important, such as: Market share Quality Innovation Brand reputation Development of employee skills & experience Social responsi...

Ansoff Matrix - The Ansoff is a famous strategic maketing planning tool that helps a business determine its product and market growth strategy. The matrix identifies four alternative growth strategies to product and market strategy based around whether a business chooses to focus on existing/new products and existing/new markets and the relationship between risk and reward. MARKET PENETRATION   This is a growth strategy where a business aims to sell EXISTING products to EXISTING markets. Key Points: Trying to sell more of an existing product/service to the same target audience LIMITED RISK = limited potential reward also. Getting existing customers to buy more Widen the range of existing products Gain market share from competitors through competitive pricing or advertising Changes to the marketing mix e.g. loyalty scheme to increase repeat customers Extension strategies Evaluating market penetration: Business focuses on markets and products it knows well Can...