Practise Edexcel Business questions on the marketing mix and strategy, applying product, price, promotion and place decisions to a specific business context.
Sources for use with
Extract E
Niche brands are increasing their mass market appeal
In the last 10 years there has been an increase in the number of health and well-being brands moving from a niche to a mass market. Many health products are benefitting from increased revenue, due to growing consumer desires to live healthier lives. These brands are no longer viewed as exclusive products and are now purchased by more customers each year. One of these brands is Pukka, which sells premium priced speciality tea. The global speciality tea market is predicted to grow by $50bn between 2021 and 2026. Extract F
About Pukka
Pukka sells a range of speciality teas including herbal, organic and fruit teas. Entrepreneurs Sebastian Pole and Tim Westwell launched Pukka in 2001. Sebastian had been interested in plants and conservation for many years. He was determined to follow his dream to start a business selling a healthy product. Sebastian saw an advertisement of Tim’s which offered to help start up an ethical business. They agreed to meet to discuss their ideas and Pukka was formed shortly afterwards. From the first moment Tim and Sebastian met, they were the perfect match. Although they had completely different personal skills, they shared a common marketing objective, to create a business that would benefit the health of people. Tim had 10 years’ experience as a business management consultant. They spent many hours in Tim’s house planning their future strategy. They worked evenings and weekends to turn their ideas into a successful business.
Extract F
About Pukka
Pukka sells a range of speciality teas including herbal, organic and fruit teas. Entrepreneurs Sebastian Pole and Tim Westwell launched Pukka in 2001. Sebastian had been interested in plants and conservation for many years. He was determined to follow his dream to start a business selling a healthy product. Sebastian saw an advertisement of Tim’s which offered to help start up an ethical business. They agreed to meet to discuss their ideas and Pukka was formed shortly afterwards. From the first moment Tim and Sebastian met, they were the perfect match. Although they had completely different personal skills, they shared a common marketing objective, to create a business that would benefit the health of people. Tim had 10 years’ experience as a business management consultant. They spent many hours in Tim’s house planning their future strategy. They worked evenings and weekends to turn their ideas into a successful business.
Define the term 'marketing objective'. (Extract F, line 9)
Assess the challenges that a business, such as Pukka, may have faced when
moving from a niche to a mass marketing strategy.
Source for use with Section B
Extract C
About Skechers
Skechers is a global footwear company that designs and develops shoes for men, women and children. It sells its products online and in more than 2,700 shops in 170 countries through its established distribution channels. The annual sales revenue of the business increased from $3.52bn in 2016 to $4.16bn in 2017.
Skechers' marketing department uses both primary and secondary market research. Focus groups and interviews are used during the design stage to collect opinions on new shoes before they are launched onto the market. Focus groups are also used to gain feedback on the performance and comfort of existing styles of shoes. Since 1992 when it launched its first shoe, the company has diversified into several new lines, targeting different market segments and different activities.
The range is updated regularly and includes shoes for walking, work and casual wear. The portfolio includes 3,000 different styles of footwear for all ages that offer quality and comfort. Its best-selling shoe is the Go-Walk brand, sold globally. More recently the company has designed and sold shoes for athletes and is now competing with companies such as Nike and Adidas.
Organisation of Skechers
Although Skechers has offices and shops globally it has maintained a centralised organisational structure. At the corporate headquarters in California, USA, Skechers research, design, and develop the shoes as well as controlling global marketing campaigns and operations. Offices based in South America, Europe and Asia oversee the regional operations.
David Weinberg is the Chief Operating Officer (COO) based in the USA head office. He is responsible for the day-to-day operations. These include planning Skechers policies and objectives and developing financial and distribution strategies to expand the business.
Discuss how the product life cycle may help Skechers develop its product portfolio.
Sources for use with Section B
Extract C
Competition in the Entertainment Industry
The games console market is dominated by three businesses; Sony, Microsoft and Nintendo. For many years Sony’s PlayStation console dominated the market. However, Nintendo regained its leadership position for the first time since 2009 with the sales of its new game console, the Switch.
In 2019, Nintendo sold 17.3 million Switch consoles, Sony sold 17.1 million PlayStation consoles, and Microsoft remained in third place, selling 10 million Xbox consoles.
Extract D
Nintendo’s Goal: Bringing Smiles to People’s Faces
Nintendo was founded in 1899 in Japan. It produced traditional Japanese playing cards. In 1970, Nintendo started the development of games consoles and video games. The entertainment market is dynamic, and Nintendo’s goal is to create fun experiences through product innovation.
Nintendo has sold more than 4.7 billion video games and more than 750 million game console units. This is because of the iconic characters it has created, including Super Mario, Donkey Kong, and Pokémon. Its most successful games consoles included Game Boy and the Wii. The Game Boy became the first handheld console to sell in large numbers but is no longer manufactured and the Wii has declining sales. In 2018, the Nintendo Switch was launched, which allows users to enjoy games anytime, anywhere, with anyone.
Extract E
Organisational changes at Nintendo
Nintendo recently made changes to its organisation that positively impacted on the business. Nintendo merged its two game development divisions, which were previously separate. One division had focused on consoles used in the home like the Wii while the other created games for handheld devices like the 3DS. Combining the two divisions aimed to speed up the development of products and allow Nintendo’s creative teams to share ideas and technology.
The use of a matrix organisation has proved to be a good move given the nature of the Switch, which is both a handheld device and a home console. This differentiates it from other games consoles in the market. The main benefit of the reorganisation is that it allows Nintendo to be more flexible with how it uses its game developers and other employees.
Analyse two different pricing strategies that Nintendo might use to compete in the games console industry.
Discuss how the Boston Matrix may help companies such as Nintendo develop their product portfolio.
Sources for use with
Extract E
Niche brands are increasing their mass market appeal
In the last 10 years there has been an increase in the number of health and well-being brands moving from a niche to a mass market. Many health products are benefitting from increased revenue, due to growing consumer desires to live healthier lives. These brands are no longer viewed as exclusive products and are now purchased by more customers each year. One of these brands is Pukka, which sells premium priced speciality tea. The global speciality tea market is predicted to grow by $50bn between 2021 and 2026. Extract F
About Pukka
Pukka sells a range of speciality teas including herbal, organic and fruit teas. Entrepreneurs Sebastian Pole and Tim Westwell launched Pukka in 2001. Sebastian had been interested in plants and conservation for many years. He was determined to follow his dream to start a business selling a healthy product. Sebastian saw an advertisement of Tim’s which offered to help start up an ethical business. They agreed to meet to discuss their ideas and Pukka was formed shortly afterwards. From the first moment Tim and Sebastian met, they were the perfect match. Although they had completely different personal skills, they shared a common marketing objective, to create a business that would benefit the health of people. Tim had 10 years’ experience as a business management consultant. They spent many hours in Tim’s house planning their future strategy. They worked evenings and weekends to turn their ideas into a successful business.
Extract F
About Pukka
Pukka sells a range of speciality teas including herbal, organic and fruit teas. Entrepreneurs Sebastian Pole and Tim Westwell launched Pukka in 2001. Sebastian had been interested in plants and conservation for many years. He was determined to follow his dream to start a business selling a healthy product. Sebastian saw an advertisement of Tim’s which offered to help start up an ethical business. They agreed to meet to discuss their ideas and Pukka was formed shortly afterwards. From the first moment Tim and Sebastian met, they were the perfect match. Although they had completely different personal skills, they shared a common marketing objective, to create a business that would benefit the health of people. Tim had 10 years’ experience as a business management consultant. They spent many hours in Tim’s house planning their future strategy. They worked evenings and weekends to turn their ideas into a successful business.
Define the term 'marketing objective'. (Extract F, line 9)
Sources for use with Section B
Extract C
Competition in the Entertainment Industry
The games console market is dominated by three businesses; Sony, Microsoft and Nintendo. For many years Sony’s PlayStation console dominated the market. However, Nintendo regained its leadership position for the first time since 2009 with the sales of its new game console, the Switch.
In 2019, Nintendo sold 17.3 million Switch consoles, Sony sold 17.1 million PlayStation consoles, and Microsoft remained in third place, selling 10 million Xbox consoles.
Extract D
Nintendo’s Goal: Bringing Smiles to People’s Faces
Nintendo was founded in 1899 in Japan. It produced traditional Japanese playing cards. In 1970, Nintendo started the development of games consoles and video games. The entertainment market is dynamic, and Nintendo’s goal is to create fun experiences through product innovation.
Nintendo has sold more than 4.7 billion video games and more than 750 million game console units. This is because of the iconic characters it has created, including Super Mario, Donkey Kong, and Pokémon. Its most successful games consoles included Game Boy and the Wii. The Game Boy became the first handheld console to sell in large numbers but is no longer manufactured and the Wii has declining sales. In 2018, the Nintendo Switch was launched, which allows users to enjoy games anytime, anywhere, with anyone.
Extract E
Organisational changes at Nintendo
Nintendo recently made changes to its organisation that positively impacted on the business. Nintendo merged its two game development divisions, which were previously separate. One division had focused on consoles used in the home like the Wii while the other created games for handheld devices like the 3DS. Combining the two divisions aimed to speed up the development of products and allow Nintendo’s creative teams to share ideas and technology.
The use of a matrix organisation has proved to be a good move given the nature of the Switch, which is both a handheld device and a home console. This differentiates it from other games consoles in the market. The main benefit of the reorganisation is that it allows Nintendo to be more flexible with how it uses its game developers and other employees.
Discuss how the Boston Matrix may help companies such as Nintendo develop their product portfolio.
Sources for use with Extract D In congested Istanbul, companies get goods to you fast There has been a rapid growth in the demand for shopping services in Istanbul, Turkey. These on-demand services are expanding because transportation can be slow. Businesses are making use of new technology, wages are rising and more people have access to smartphones. Shopping services such as Kapgel and Getir offer innovative delivery solutions to meet the needs of their customers. Both firms have different approaches, but aim to meet people’s immediate needs and develop customer loyalty by using technology to develop apps and deliver goods as quickly as possible. Kapgel has designed an app to allow customers to shop from a wide number of stores and supermarkets. The customer creates a basket of goods on the app and a delivery person shops for these items and delivers directly to the customer. Deliveries are made within one hour for a delivery fee of 5 Turkish Lira (US $0.85). Kapgel does not keep any stock and uses part-time and temporary delivery people, rather than employing workers on a permanent and full-time basis. Getir owns many warehouses around Istanbul to stock over 1,000 different products, including food items and small electrical goods. Customers select from the 1,000 items using an app on their smartphone. Getir employs over 350 people for this delivery business and have an average delivery time of 9 minutes and 6 seconds. Unlike Kapgel’s delivery fee, Getir adds a cost to each product. It has a minimum shopping total of 15 Turkish Lira (US $2.55) before it will deliver an order.
Extract E BiSU Water Delivery In Turkey, most tap water is not drinkable. Delivery services in the past were slow and not well organised. On-demand delivery services such as BiSU have changed the water delivery market in Turkey. Customers can now order water using an app on their smartphone. They can have it delivered quickly and at a time to suit them. BiSU has a large team of delivery drivers. The business was launched in 2015 and has expanded to many cities in Turkey, receiving over 100,000 orders a month from 38,000 users. Water prices depend on the brand requested and the region the water is delivered to.
Assess the extent to which product is the most important element of the
marketing mix for on-demand delivery businesses in Turkey.
Sources for use with
Extract E
Niche brands are increasing their mass market appeal
In the last 10 years there has been an increase in the number of health and well-being brands moving from a niche to a mass market. Many health products are benefitting from increased revenue, due to growing consumer desires to live healthier lives. These brands are no longer viewed as exclusive products and are now purchased by more customers each year. One of these brands is Pukka, which sells premium priced speciality tea. The global speciality tea market is predicted to grow by $50bn between 2021 and 2026. Extract F
About Pukka
Pukka sells a range of speciality teas including herbal, organic and fruit teas. Entrepreneurs Sebastian Pole and Tim Westwell launched Pukka in 2001. Sebastian had been interested in plants and conservation for many years. He was determined to follow his dream to start a business selling a healthy product. Sebastian saw an advertisement of Tim’s which offered to help start up an ethical business. They agreed to meet to discuss their ideas and Pukka was formed shortly afterwards. From the first moment Tim and Sebastian met, they were the perfect match. Although they had completely different personal skills, they shared a common marketing objective, to create a business that would benefit the health of people. Tim had 10 years’ experience as a business management consultant. They spent many hours in Tim’s house planning their future strategy. They worked evenings and weekends to turn their ideas into a successful business.
Assess the challenges that a business, such as Pukka, may have faced when
moving from a niche to a mass marketing strategy.
Sources for use with Extract D In congested Istanbul, companies get goods to you fast There has been a rapid growth in the demand for shopping services in Istanbul, Turkey. These on-demand services are expanding because transportation can be slow. Businesses are making use of new technology, wages are rising and more people have access to smartphones. Shopping services such as Kapgel and Getir offer innovative delivery solutions to meet the needs of their customers. Both firms have different approaches, but aim to meet people’s immediate needs and develop customer loyalty by using technology to develop apps and deliver goods as quickly as possible. Kapgel has designed an app to allow customers to shop from a wide number of stores and supermarkets. The customer creates a basket of goods on the app and a delivery person shops for these items and delivers directly to the customer. Deliveries are made within one hour for a delivery fee of 5 Turkish Lira (US $0.85). Kapgel does not keep any stock and uses part-time and temporary delivery people, rather than employing workers on a permanent and full-time basis. Getir owns many warehouses around Istanbul to stock over 1,000 different products, including food items and small electrical goods. Customers select from the 1,000 items using an app on their smartphone. Getir employs over 350 people for this delivery business and have an average delivery time of 9 minutes and 6 seconds. Unlike Kapgel’s delivery fee, Getir adds a cost to each product. It has a minimum shopping total of 15 Turkish Lira (US $2.55) before it will deliver an order.
Extract E BiSU Water Delivery In Turkey, most tap water is not drinkable. Delivery services in the past were slow and not well organised. On-demand delivery services such as BiSU have changed the water delivery market in Turkey. Customers can now order water using an app on their smartphone. They can have it delivered quickly and at a time to suit them. BiSU has a large team of delivery drivers. The business was launched in 2015 and has expanded to many cities in Turkey, receiving over 100,000 orders a month from 38,000 users. Water prices depend on the brand requested and the region the water is delivered to.
Extract D In congested Istanbul, companies get goods to you fast There has been a rapid growth in the demand for shopping services in Istanbul, Turkey. These on-demand services are expanding because transportation can be slow. Businesses are making use of new technology, wages are rising and more people have access to smartphones. Shopping services such as Kapgel and Getir offer innovative delivery solutions to meet the needs of their customers. Both firms have different approaches, but aim to meet people’s immediate needs and develop customer loyalty by using technology to develop apps and deliver goods as quickly as possible. Kapgel has designed an app to allow customers to shop from a wide number of stores and supermarkets. The customer creates a basket of goods on the app and a delivery person shops for these items and delivers directly to the customer. Deliveries are made within one hour for a delivery fee of 5 Turkish Lira (US $0.85). Kapgel does not keep any stock and uses part-time and temporary delivery people, rather than employing workers on a permanent and full-time basis. Getir owns many warehouses around Istanbul to stock over 1,000 different products, including food items and small electrical goods. Customers select from the 1,000 items using an app on their smartphone. Getir employs over 350 people for this delivery business and have an average delivery time of 9 minutes and 6 seconds. Unlike Kapgel’s delivery fee, Getir adds a cost to each product. It has a minimum shopping total of 15 Turkish Lira (US $2.55) before it will deliver an order.
Define the term ‘customer loyalty’. (Extract D, line 8)
Function, aesthetics and cost of manufacture are elements of the design mix.
Evaluate which of these is the most important element for manufacturers of smartphones.
Extract C
Redundancies and organisational changes at Deutsche Bank
Deutsche Bank was founded 150 years ago in Germany. Today it is a leading global bank. In 2019, 18,000 Deutsche Bank employees, working in Hong Kong, New York and London, were made redundant as part of a restructuring plan. This plan included drastically reducing its investment banking division and removing layers of management to make a flatter organisational structure. A Deutsche Bank spokesperson said: "We have decided to focus our resources on areas of the business where customers need us most." The bank used collective bargaining to agree redundancy payments for employees who lost their jobs. These agreements were put in place to protect its reputation and limit the number of unfair dismissal cases.
Extract D
Global market share by \% revenue of the 10 leading investment banks in 2019
Extract E
Positive Impact marketing campaign at Deutsche Bank
Deutsche Bank plans to launch a global advertisement campaign, named Positive Impact. It uses customer stories to show the benefits of using the bank. These stories are told through short films featuring customers and bankers, showing how they support customers to achieve their plans and ambitions. Deutsche Bank will also use social media to engage with its employees and customers. In addition a television advertisement will be used to show the partnership between Laura Dekker, the youngest person to sail solo around the world, and her father, who helped plan her epic voyage and whose encouragement from the shore helped her to succeed. The advertisement uses the relationship between Laura and her father as an inspiring example of positive impact, which represents the bank's role in enabling the ambitions and dreams of its clients to be met.
Discuss the advantages for Deutsche Bank of using television advertising in its
marketing campaign.
Sources for use with
Extract C
Hot sauce is essential in Mexican cuisine
Hot sauce (or ‘salsa picante’ in Spanish) is an everyday ingredient in Mexican cooking. The people of Mexico have developed a strong liking for chilli peppers. In Mexican restaurants and homes no table is completely set without a bottle of hot sauce. Chilli peppers are mostly grown in Western Mexico. Each sauce tastes different, depending on the type of pepper used and the ratio of chillies to other ingredients such as vinegar and spices. Most households make their own versions but numerous businesses manufacture hot sauce brands for sale in Mexico and for export.
Extract D
Grupo Tamazula – our story
Grupo Tamazula is a public limited company that manufactures hot sauce in Guadalajara, in the Jalisco region of Mexico. The business began in 1960 when the Tamazula brand was introduced. It quickly became popular throughout Mexico. Shortly after, it introduced another brand of hot sauce, Salsa Valentina, to the market. Salsa Valentina became a market leader of hot sauce production with increasing sales across Mexico. Grupo Tamazula products are made with the finest ingredients. Salsa Valentina for example, is thicker than many of its competitors, and contains less vinegar and more fresh chillies. The hot sauces are packed using the most modern equipment available and investment in new technology keeps Grupo Tamazula up to date. The factory is over 26,000 m2, generating employment in the area. The company sells its products all over Mexico and through its US-based international sales office. Exports continue to increase, especially to the US and Canada.
Extract D
Grupo Tamazula – our story
Grupo Tamazula is a public limited company that manufactures hot sauce in Guadalajara, in the Jalisco region of Mexico. The business began in 1960 when the Tamazula brand was introduced. It quickly became popular throughout Mexico. Shortly after, it introduced another brand of hot sauce, Salsa Valentina, to the market. Salsa Valentina became a market leader of hot sauce production with increasing sales across Mexico. Grupo Tamazula products are made with the finest ingredients. Salsa Valentina for example, is thicker than many of its competitors, and contains less vinegar and more fresh chillies. The hot sauces are packed using the most modern equipment available and investment in new technology keeps Grupo Tamazula up to date. The factory is over 26,000 m2, generating employment in the area. The company sells its products all over Mexico and through its US-based international sales office. Exports continue to increase, especially to the US and Canada.
Define the term 'brand'. (Extract D, line 4)
Sources for use with Section A
Extract A
The soft drink industry is dominated by Coca-Cola and PepsiCo
Two brands of soft drinks, Coca-Cola and PepsiCo, have dominated the non-alcoholic drinks market for many years. The brands are well known and recognised around the world. Coca-Cola is the larger of the two companies with more than 500 brands. The companies do not have major threats from competition because they both have high levels of brand loyalty, extensive distribution networks and huge economies of scale. They spend enormous amounts of money on innovation, advertising, marketing, and strengthening their distribution channels.
Extract B
Coca-Cola: Who we are
We are the world’s largest soft drinks company. Our brands include Diet Coke, Coca-Cola Zero, Fanta, Sprite, Dasani, Powerade, Minute Maid and Gold Peak. Over 1.9 billion of our drinks are enjoyed by consumers in more than 200 countries each day.
Our market research on Diet Coke
We focus on the needs of our consumers by going into the market to listen to their views and collect feedback on new drinks. One of our recent research projects focused on Diet Coke, known as Coca-Cola light in most international markets. The drink is sold in more than 110 countries. Our aim is to offer new flavours and a modern look to the product to attract new consumers as well as maintaining the brand loyalty of our current fans. As part of the research, we used face-to-face surveys to gather data from more than 10,000 people. We wanted their ideas and views on new packaging and new flavours, including Ginger Lime and Twisted Mango. These new products will be available in 2019.
Our rewarding work environment: benefits and rewards
We value our workers and understand working is not just about pay and benefits. We provide a positive working environment to enable staff to build a career and also maintain a good work-life balance. We regularly assess our benefits programs to ensure employees receive the benefits they value. The financial benefits include competitive pay, annual bonuses and performance-related pay.
Analyse two benefits of strong branding for Coca-Cola.
Sources for use with Section B
Extract C
Airline Companies in the Middle East
Over the past 10 years airline companies based in the Middle East have significantly increased the number of passengers they carry each year. Competitors, Emirates, Etihad Airways and Qatar Airways have attracted travellers with competitive pricing, superior service and luxurious premium cabins. Whilst passenger numbers are increasing, these airlines are facing competition from low-cost airlines, such as Norwegian Air Shuttle and Singapore-based Scoot. These airlines are attracting customers with low-priced fares on some of the same routes. Total passengers carried (m)
Emirates Etihad Qatar Airways Years
Extract D
Emirates: Our story
We started operations in 1985 in Dubai with two aircraft and we have increased the number of aircraft and destinations each year. Today, with more than 265 aircraft, we fly to 155 destinations in 80 countries. We provide industry-leading inflight entertainment, excellent inflight food and world-class customer service. We are known all over the world for our commitment to quality, which we continually seek to improve. Our achievements in 2017 included:
• Three new destinations; Newark in the US, Phnom Penh in Cambodia and Zagreb in Croatia
• Our advertising campaign for our improved first-class service, using television celebrity and motoring expert Jeremy Clarkson
• We became the world’s first airline with one million followers on the social media site Instagram. This helps us to monitor the experiences and feedback from our customers
• In a recent study of the top 100 brands most visible on social media, we were ranked fifth after McDonald’s, Nike, Adidas and Coca-Cola.
Extract C: total passengers carried by Emirates, Etihad and Qatar Airways
Many businesses now recognise the importance of social media as a way of building a brand. Analyse two benefits for a company, such as Emirates, of using social media.
Extract E About GoPro GoPro was started by Nick Woodman in 2002. He was looking for a way to film himself and his friends when they were surfing. He designed a small camera, which he fixed to a strap on his wetsuit. The business has grown internationally and now sells the GoPro cameras in over 100 countries. The cameras attach to helmets and sports equipment. This gave GoPro a unique selling point when it was first launched. GoPro is committed to ethical sourcing. It requires suppliers to treat workers with respect by paying fair wages and providing safe working conditions. It does not allow the use of underage workers and requires that the manufacturing processes used do not damage the environment.
Extract F From Product Orientation to Consumer Orientation When GoPro started it used a product orientation approach. However, GoPro soon faced competition from other businesses such as Sony and DJI. Less expensive cameras became available in the market, and some customers were opting to simply take videos with their smartphones. In response to falling sales, GoPro conducted market research and developed a new range of cameras. These were aimed at a wider market, including firefighters, musicians, new parents and television broadcasters.
Extract G Social Media Users of GoPro cameras share their adventures and experiences on social media sites such as Instagram, YouTube and Facebook. GoPro organises sporting events around the world and participants upload their videos. The most viewed GoPro video, of a bicycle backflip, had over 134 million views.
Analyse two benefits that a business, such as GoPro, may gain from the use of
social media.
Sources for use with Section B
Extract C
Airline Companies in the Middle East
Over the past 10 years airline companies based in the Middle East have significantly increased the number of passengers they carry each year. Competitors, Emirates, Etihad Airways and Qatar Airways have attracted travellers with competitive pricing, superior service and luxurious premium cabins. Whilst passenger numbers are increasing, these airlines are facing competition from low-cost airlines, such as Norwegian Air Shuttle and Singapore-based Scoot. These airlines are attracting customers with low-priced fares on some of the same routes. Total passengers carried (m)
Emirates Etihad Qatar Airways Years
Extract D
Emirates: Our story
We started operations in 1985 in Dubai with two aircraft and we have increased the number of aircraft and destinations each year. Today, with more than 265 aircraft, we fly to 155 destinations in 80 countries. We provide industry-leading inflight entertainment, excellent inflight food and world-class customer service. We are known all over the world for our commitment to quality, which we continually seek to improve. Our achievements in 2017 included:
• Three new destinations; Newark in the US, Phnom Penh in Cambodia and Zagreb in Croatia
• Our advertising campaign for our improved first-class service, using television celebrity and motoring expert Jeremy Clarkson
• We became the world’s first airline with one million followers on the social media site Instagram. This helps us to monitor the experiences and feedback from our customers
• In a recent study of the top 100 brands most visible on social media, we were ranked fifth after McDonald’s, Nike, Adidas and Coca-Cola.
Extract C: total passengers carried by Emirates, Etihad and Qatar Airways
Extract C
Airline Companies in the Middle East
Over the past 10 years airline companies based in the Middle East have significantly increased the number of passengers they carry each year. Competitors, Emirates, Etihad Airways and Qatar Airways have attracted travellers with competitive pricing, superior service and luxurious premium cabins. Whilst passenger numbers are increasing, these airlines are facing competition from low-cost airlines, such as Norwegian Air Shuttle and Singapore-based Scoot. These airlines are attracting customers with low-priced fares on some of the same routes. Total passengers carried (m)
Emirates Etihad Qatar Airways Years
Extract C: total passengers carried by Emirates, Etihad and Qatar Airways
Define the term ‘competitive pricing’. (Extract C, line 4)
Sources for use with Extract A The global chocolate market Chocolate is a multi-billion-dollar market and is expected to reach high levels of growth within the next few years. Rising incomes in many countries and the widespread availability of chocolate are leading to increased demand. However, uncertainty in the supply of cocoa, which is the main ingredient in chocolate, is likely to raise the cost of producing chocolate. This may be a major challenge for chocolate retailers. There are suggestions in the media that there are health benefits from consuming chocolate, particularly dark chocolate that contains a larger proportion of cocoa. Analysts believe that as well as increased demand for dark chocolate, other areas of growth will be:
· festive chocolate
· seasonal chocolate
· organic chocolate
· fair-trade chocolate
The global chocolate market is segmented by type and sale frequency. Based on chocolate type, the market is classified as milk chocolate, dark chocolate, and white chocolate. The milk chocolate segment remains the largest selling chocolate. Based on sale frequency, the market is categorised as daily chocolate, premium chocolate and seasonal chocolate.
Extract B The top five global chocolate manufacturers (2018)
| Company | Revenue 2018 ($USbn) |
|---|---|
| Mars Wrigley Confectionery (USA) | 18.00 |
| Ferrero Group (Italy) | 12.40 |
| Mondelēz International (USA) | 11.80 |
| Meiji Co Ltd (Japan) | 9.70 |
| Hershey Co (USA) | 7.80 |
Extract C Working at Ferrero The Ferrero Group, a family run business, started in 1946 and today is one of the largest chocolate companies in the world. Employees are referred to as ‘family’ . All employees, from the day they start, are expected to involve themselves in all aspects of the business. Employees receive a competitive wage. Ferrero provides employees with extensive training programmes including on-the-job training and management support. Ferrero shows its employees respect, helps them grow in their careers, asks them for suggestions and welcomes their feedback.
Extract B The top five global chocolate manufacturers (2018)
| Company | Revenue 2018 ($USbn) |
|---|---|
| Mars Wrigley Confectionery (USA) | 18.00 |
| Ferrero Group (Italy) | 12.40 |
| Mondelēz International (USA) | 11.80 |
| Meiji Co Ltd (Japan) | 9.70 |
| Hershey Co (USA) | 7.80 |
Analyse two factors that are likely to determine the pricing strategy used by chocolate manufacturers.
Extract C About Aldi Aldi was founded by the Albrecht family in Germany. The family had owned grocery stores since 1914 when Anna Albrecht opened a small store. Aldi remains a family business and is now run by brothers Theo and Karl Albrecht. Aldi believes that great quality should not come at a high price, rather that great quality should come with everyday low prices. Aldi focuses on giving customers quality food, good customer service, low prices and a quick and easy efficient shopping experience with only four to five store aisles but with all grocery essentials. Aldi sources much of its produce from local suppliers. The stores partner with local growers and farmers to offer a wide variety of fresh produce, including organic fruits and vegetables. There are thousands of Aldi stores throughout Europe and it has expanded into the US. Aldi is one of the UK's fastest growing supermarket chains and plans to have 1,200 stores in the UK by 2025. Aldi has won numerous awards for offering competitive rates of pay and excellent working environments for all its employees. In the UK Aldi is known for promoting its 'Super 6 fruit and vegetables'. Each week there are six types of fruits or vegetables offered at a reduced price. Aldi sponsors the UK Olympic team to promote a healthier lifestyle and advertises its Super 6 products using TV and other media.
Extract D What does the future hold for the UK grocery industry? In response to changing social trends in the UK, supermarkets are having to adapt. The rise of the German-based stores, Aldi and Lidl, which both sell at low prices, have forced the UK's largest supermarkets (Tesco, Asda, Sainsbury's and Morrisons) into changing how they operate. The way that people in the UK shop for groceries is changing. People are shopping more frequently for fresh groceries and using online services. Tesco is planning to offer a one- hour delivery service. Fewer shoppers are loyal to a specific supermarket as more are using price comparison websites to compare supermarkets.
Extract E Market share (by sales revenue) of the top 10 UK Supermarkets
Assess the likely impact of price comparison websites on supermarkets in the UK.
Sources for use with Section A
Extract A
The soft drink industry is dominated by Coca-Cola and PepsiCo
Two brands of soft drinks, Coca-Cola and PepsiCo, have dominated the non-alcoholic drinks market for many years. The brands are well known and recognised around the world. Coca-Cola is the larger of the two companies with more than 500 brands. The companies do not have major threats from competition because they both have high levels of brand loyalty, extensive distribution networks and huge economies of scale. They spend enormous amounts of money on innovation, advertising, marketing, and strengthening their distribution channels.
Extract B
Coca-Cola: Who we are
We are the world’s largest soft drinks company. Our brands include Diet Coke, Coca-Cola Zero, Fanta, Sprite, Dasani, Powerade, Minute Maid and Gold Peak. Over 1.9 billion of our drinks are enjoyed by consumers in more than 200 countries each day.
Our market research on Diet Coke
We focus on the needs of our consumers by going into the market to listen to their views and collect feedback on new drinks. One of our recent research projects focused on Diet Coke, known as Coca-Cola light in most international markets. The drink is sold in more than 110 countries. Our aim is to offer new flavours and a modern look to the product to attract new consumers as well as maintaining the brand loyalty of our current fans. As part of the research, we used face-to-face surveys to gather data from more than 10,000 people. We wanted their ideas and views on new packaging and new flavours, including Ginger Lime and Twisted Mango. These new products will be available in 2019.
Our rewarding work environment: benefits and rewards
We value our workers and understand working is not just about pay and benefits. We provide a positive working environment to enable staff to build a career and also maintain a good work-life balance. We regularly assess our benefits programs to ensure employees receive the benefits they value. The financial benefits include competitive pay, annual bonuses and performance-related pay.
Extract A
The soft drink industry is dominated by Coca-Cola and PepsiCo
Two brands of soft drinks, Coca-Cola and PepsiCo, have dominated the non-alcoholic drinks market for many years. The brands are well known and recognised around the world. Coca-Cola is the larger of the two companies with more than 500 brands. The companies do not have major threats from competition because they both have high levels of brand loyalty, extensive distribution networks and huge economies of scale. They spend enormous amounts of money on innovation, advertising, marketing, and strengthening their distribution channels.
Define the term ‘distribution channels’. (Extract A, line 8)
Extract E
Mr Cory's Cookies
Young entrepreneur Cory Nieves is also known as Mr Cory. When he was five years old he started selling hot chocolate in his neighbourhood to raise money to buy a car for his family. Cory then began selling lemonade and cookies to increase the buying options for his loyal customers. His passion and entrepreneurial spirit, combined with a love of treats, led him to be the owner of Mr Cory's Cookies at six years old. Cory's mother, Lisa, spent many months learning how to bake the cookies. She then test marketed each batch in the local area. The business became famous in the local community for Cory's chocolate chip cookies, which continue to be the best seller. The product line has expanded, and the cookies are manufactured using only natural and high-quality ingredients. The cookies are now only available online. Due to the publicity he received as a young entrepreneur, Cory has had many television appearances and has worked with large companies and brands such as Mercedes Benz, Ralph Lauren, TOMS and Macys. In addition, he has worked with non-profit organisations such as the Children's Aid Society.
Extract F
The value of Mr Cory's Cookies
The sweets and snacks market is extremely competitive and the market is growing. In 2021 Cory Nieves was 17 years old and the value of his business had increased to $ 1500000. Value of Mr Cory's Cookies (2018-2021)
Assess the decision by Mr Cory's Cookies to use only online retailing to sell its
cookies.