Rachel's business produces and sells chocolate bars. Quality is important. Rachel is a sole trader who received government support when she started up her business. The business operates in a competitive market. Rachel is considering ways to increase sales of her best-selling product. She is also planning to introduce a new chocolate bar. Rachel knows deciding which pricing method to use for a new product is important. Outline two ways Rachel could increase sales of her best-selling product. Way 1 : Way 2 :
Exam No：0450_m25_qp_12 Year：2025 Question No：2(c)
Answer:
Award 1 mark for each relevant way [max 2].
Award 1 mark for each relevant reference to this business [max 2].
Points might include:
- Advertising or examples e.g. use social media [k] to explain quality is important [app]
- Improve the existing product / use better quality materials / new features / new variations [k] to make its chocolate [app]
- Decrease prices / promotional pricing / offer discounts \([\mathrm{k}]\) in the competitive market [app]
- Point of sale display [k] by the sole trader [app]
- Free samples [k]
- Competitions [k]
- Offer free gifts [k]
- Buy One Get One Free / BOGOF [k]
- New/change packaging [k]
- Enter a new market [k]
- Sell through new outlets \([\mathrm{k}]\)
Other appropriate responses should be credited.
Award 1 mark for each relevant reference to this business [max 2].
Points might include:
- Advertising or examples e.g. use social media [k] to explain quality is important [app]
- Improve the existing product / use better quality materials / new features / new variations [k] to make its chocolate [app]
- Decrease prices / promotional pricing / offer discounts \([\mathrm{k}]\) in the competitive market [app]
- Point of sale display [k] by the sole trader [app]
- Free samples [k]
- Competitions [k]
- Offer free gifts [k]
- Buy One Get One Free / BOGOF [k]
- New/change packaging [k]
- Enter a new market [k]
- Sell through new outlets \([\mathrm{k}]\)
Other appropriate responses should be credited.
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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