Consider the advantages and disadvantages of the following three methods of promotion PF could use for its new product range. Which is likely to be the best method for PF to use to increase sales? Justify your answer. - Leaflets handed out in the street - Billboards on the side of a main road - Discounts on first purchase Leaflets handed out in the street: . . . . . Billboards on the side of a main road: . . . . . Discounts on first purchase: . . . . . Conclusion: . . . . .
Exam No：0450_s25_qp_21 Year：2025 Question No：3(b)
Answer:
Justification could include:
- Leaflets handed out in the street will be the most effective because they can be kept by potential customers and reminded of the shoes so a purchase can be made later. The name of the product and where it can be purchased will not be forgotten so sales are likely to increase. Billboards will be less effective as they can easily be missed as people go past them and a discount will only be effective if it is a large discount, which will significantly reduce PF's profit margin.
- Billboards on the side of the road will be the most effective way to increase sales because it will be seen every day by a large number of people passing by and if the billboard is attractive, it will draw the attention of many potential customers leading to higher sales of shoes.
- Discounts on the first purchase will be the most effective way to increase sales because it will lower the price of the rubber shoes making them more affordable and encourage the customer to make the purchase. If they like the sustainability of the raw materials used, then they will come back and be a regular customer of the business.
- Leaflets handed out in the street will be the most effective because they can be kept by potential customers and reminded of the shoes so a purchase can be made later. The name of the product and where it can be purchased will not be forgotten so sales are likely to increase. Billboards will be less effective as they can easily be missed as people go past them and a discount will only be effective if it is a large discount, which will significantly reduce PF's profit margin.
- Billboards on the side of the road will be the most effective way to increase sales because it will be seen every day by a large number of people passing by and if the billboard is attractive, it will draw the attention of many potential customers leading to higher sales of shoes.
- Discounts on the first purchase will be the most effective way to increase sales because it will lower the price of the rubber shoes making them more affordable and encourage the customer to make the purchase. If they like the sustainability of the raw materials used, then they will come back and be a regular customer of the business.
Knowledge points:
3.3.1.1. The limitations and benefits of developing new products
3.3.1.2. Brand image; impact on sales and customer loyalty
3.3.1.3. The role of packaging
3.3.1.4. The product life cycle: main stages and extension strategies; draw and interpret a product life cycle diagram
3.3.1.5. How stages of the product life cycle can influence marketing decisions, e.g. promotion and pricing decisions
3.3.2.1. Pricing methods (benefits and limitations of different methods), e.g. cost plus, competitive, penetration, skimming, and promotional
3.3.2.2. Recommend and justify an appropriate pricing method in given circumstances
3.3.2.3. Understand the significance of price elasticity: difference between price elastic demand and price inelastic demand; importance of the concept in pricing decisions (knowledge of the formula and calculations of PED will not be assessed)
3.3.3.1. Advantages and disadvantages of different channels, e.g. use of wholesalers, retailers or direct to consumers
3.3.3.2. Recommend and justify an appropriate distribution channel in given circumstances
3.3.4.1. The aims of promotion
3.3.4.2. Different forms of promotion and how they influence sales, e.g. advertising, sales promotion
3.3.4.3. The need for cost-effectiveness in spending the marketing budget on promotion
3.3.5.1. Define and explain the concept of e-commerce
3.3.5.2. The opportunities and threats of e-commerce to business and consumers
3.3.5.3. Use of the internet and social media networks for promotion
Solution:
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