The marketing mix: product and price · AS Level Business

CC manufactures a range of cola drinks aimed at the mass market. The company is the market leader for cola drinks in country N. CC produces four variants of its cola drink:

• Original cola
• Sugar‑free cola 5
• Caffeine‑free cola
• Cherry cola The company uses market segmentation to plan the marketing of each of the four variants. CC uses cost‑based pricing by adding 80% to the cost when calculating the price of all products. CC sells 50 000 bottles of Sugar‑free cola each month. Table 1.1 shows the cost 10 information for one bottle of Sugar‑free cola.

CC’s sales of Cherry cola have decreased by 12% over the past year. The marketing
manager is planning to carry out market research to investigate the reason for this
decrease. The research will collect qualitative data. The marketing manager will use this
data to make decisions about a marketing campaign to increase sales.
CC has 4 factories in country N and employs 1750 employees. All employees are paid 20
using a time‑based payment method and the work is repetitive. Operations are capital
intensive. The human resource manager is concerned that employees lack motivation,
leading to high labour turnover. Labour turnover has increased by 8% over the past year.
The human resource manager is considering changing the employee payment method from
time‑based to piece rate. 25

Kamal is a successful social media influencer. In 2020, Kamal launched his own social media platform, called Influencer Xperience (IX), operating in the quaternary sector of the economy. Kamal targeted other social media influencers with IX’s promotion. IX allows influencers to manage and publish videos on its platform. The unique selling point of IX is that it provides the influencers with better and more detailed information than any other platform. 5 IX is a free-to-use service for social media influencers. IX charges other businesses to advertise on the platform. The price of advertising space is set each month, using dynamic pricing, based on how many users click on an advertisement (price per click). Table 1.1 shows some data about advertising on IX’s platform.

IX’s operations are labour intensive and Kamal describes his management style as laissez-faire. IX has 30 employees who are all managed by Kamal (see Table 1.2).

FF is a partnership in country Q that grows a range of fruits and vegetables, such as apples,
carrots and potatoes. FF also provides an advisory service to other farmers. The partnership
was established in 2018 by three friends, Amrit, Harry and Sally, who provided the working
capital. Their aim was to produce healthy and tasty food for themselves and others.
FF grows crops using natural methods and practices. The produce is free from chemicals 5
and pesticides. It only uses renewable energy sources, such as solar panels and wind
turbines. It harvests the crops by hand or using simple machines that minimise damage or
waste, but this is labour intensive.
FF sells its products directly to consumers through its own farm shop and online delivery
service. It also sells to local restaurants. Table 2.1 shows information on FF’s revenue and 10
costs in 2024.

FF has gained a loyal customer base who appreciate the quality, flavour and nutrition of its products. However, FF also faces some challenges and risks in the competitive and uncertain food market. FF has limited capacity in producing crops. Weather conditions affect its yield and quality. It also must deal with pests, diseases and natural disasters that could 20 damage or destroy its crops. Another challenge that FF faces is the high level of demand for its products in the market. The partnership must meet the expectations and requirements of its customers who want fresh, varied and consistent products throughout the year.

Frank grows fruit, including oranges, on his farm in country J. He sells his fruit at a market in a local city one day a week. Frank is a sole trader and operates in the primary and tertiary sectors. He set up FF using all of his redundancy money from a previous job with a large company. Frank’s business objective is to increase profit by 10% by the end of 2026. He also has a 5 target profitability of 25% by the same date. He uses the data from break-even analysis to make business decisions. Table 1.1 shows forecast data for the sale of oranges in July 2025.

Frank has two main competitors:

• a national supermarket with stores locally 15
• a shop in the local city selling fruit. Frank’s business is very successful as the fruit he sells is fresher than products sold by his competitors. This is Frank’s USP. His fruit is sold only a few hours after it is picked. However, the fruit sold by Frank’s competitors is grown hundreds of kilometres away. Customers also enjoy the range of fruit sold by Frank as it varies throughout the year. 20 Frank currently uses competitive pricing but is thinking of introducing price skimming in the future.