Edexcel GCSE Business: Promotion, place and combining the marketing mix (1BS0) – Practice Questions

These are original questions written for Marlbridge, for revision and practice on this content. They are not reproduced past-paper questions, and they do not replicate the exam’s exact structure, question count or mark tariffs – examination boards hold copyright in their own papers. Use these alongside the official past papers from your board or school.

This set follows Pearson Edexcel Level 1/Level 2 GCSE (9-1) Business (1BS0), Issue 2, July 2022, Theme 2 topic 2.2 Making marketing decisions, content items 2.2.3 Promotion, 2.2.4 Place and 2.2.5 Using the marketing mix to make business decisions. Show your workings. All businesses and figures are invented.

Links: the Edexcel GCSE Business hub, the printable checklist, the study guide and the revision notes. Also see product and price decisions and the free diagnostics.

Questions

1. Define the term “branding”. [2]

2. A sports-drink business pays £3,000 so that its name appears on the shirts of a local under-16 football team. State which promotion strategy this is. [1]

3. Juno Juice is launching a new fruit drink and hands out free samples in a shopping centre. Outline one reason this strategy is appropriate for a new drink. [2]

4. Cinder Coffee gives away 800 free sample sachets at a market, at a total cost of £360. Afterwards, 15% of those who took a sachet buy a 250g bag at £6.40. Calculate the number of buyers, the revenue from them, the cost per buyer and the revenue above the cost of the campaign. [4]

5. Explain one advantage to a business of targeted advertising online. [3]

6. Elmcrest Pet Treats normally sells a pack at £5.00 and sells 400 packs a week. During a special offer the price is cut by 15% and sales rise to 520 packs a week. Calculate the percentage increase in weekly revenue during the offer. [4]

7. Tarn and Thistle Teas sells loose-leaf tea. It wants to reach two segments. Segment A is students aged 18 to 22 with small budgets who spend a lot of time on social media. Segment B is customers aged 65 and over, who like to try a product before buying and read the local newspaper. Analyse how Tarn and Thistle Teas could use different promotion strategies for the two segments. [6]

8. Explain one disadvantage to a producer of selling its goods through retailers instead of directly to the public online. [3]

9. Corbel Pottery makes ceramic mugs that can break in the post. A retailer buys each mug for £10 and sells it for £16. Corbel’s own website sells the same mug for £15, and its delivery, packaging and payment costs are £3.50 per mug.

(a) Calculate the retailer’s share of the selling price as a percentage. [2] (b) Calculate how much Corbel keeps per mug sold online, and how much more this is than the amount received per mug from the retailer. [2] (c) Analyse why Corbel might still choose to sell some mugs through retailers. [4]

10. Explain one way in which a decision to raise the price of a product could influence the business’s promotion. [3]

11. Aldous Activewear is choosing between two ways to promote a £40 training-kit bundle to women aged 18 to 30 living within ten miles of its shop.

Option A: sponsor a local netball team for £2,400. About 1,500 spectators will see the name during the season, and the owner expects 5% of them to buy a bundle.

Option B: pay £1,500 for online adverts shown to 12,000 people in that segment, and expect 0.8% of them to buy a bundle.

Justify which option Aldous Activewear should choose. [6]

12. Kirkstead Pet Foods sells organic dog food at £14 a bag. The product uses organic ingredients and is sold through independent pet shops and the company’s own website. Promotion is sponsorship of local dog shows. A supermarket has launched a similar product at £8, advertised on television and sold in every branch. Evaluate whether Kirkstead’s integrated marketing mix can keep its competitive advantage. [8]

Answers

1. Creating a name, logo, design or image for a product or business [1] that customers recognise and that sets it apart from rivals [1]. [2] Examiner insight: A definition tends to gain credit when it says what branding is and what it does. “The logo on a product” describes one part only.

2. Sponsorship [1]. [1] Examiner insight: Give one answer. Writing two strategies risks including a wrong one next to the right one.

3. The drink is new, so shoppers do not know whether they will like it [1]. Tasting a free sample lets them judge it without risk, which makes them more likely to buy a full bottle [1]. [2] Examiner insight: An outline answer tends to need two linked points set in the context. The second should follow from the first, not repeat it.

4. Buyers: 15% × 800 = 120 [1]. Revenue: 120 × £6.40 = £768 [1]. Cost per buyer: £360 ÷ 120 = £3.00 [1]. Revenue above cost: £768 − £360 = £408 [1]. [4] Examiner insight: Show the working for each figure. A slip in the number of buyers affects the later figures, so clear working lets the later steps be seen.

5. The business can choose who sees the advert, for example by age, location or interests [1]. Money is therefore not spent reaching people who are unlikely to buy [1]. This improves the chance that each pound spent on advertising produces a sale, lowering the cost of winning each customer [1]. [3] Examiner insight: Explain answers tend to gain credit for a fact followed by two developments. “It reaches more people” without saying why they are the right people stays at one point.

6. Offer price = £5.00 × 85% = £4.25 [1]. Revenue before = 400 × £5.00 = £2,000 [1]. Revenue during = 520 × £4.25 = £2,210 [1]. Percentage increase = (2,210 − 2,000) ÷ 2,000 × 100 = 10.5% [1]. [4] Examiner insight: Percentage change means the change divided by the original figure. Using the new figure as the divisor is a common slip.

7. Segment A, students: viral advertising via social media, such as a funny video that students share [1]. It costs little and spreads through the segment’s own networks, which suits people who spend a lot of time on social media [1]. A special offer, such as a discount code on a first order, also suits small budgets [1]. Segment B, aged 65 and over: product trials, such as sample sachets at local events [1], suit people who like to try before buying and reduce the risk of buying an unfamiliar tea [1]. An advert in the local newspaper reaches readers of that paper [1]. [6] Examiner insight: Points tend to gain credit when they use the segment details in the stem, such as small budgets or newspaper readers. A list of strategies with no link to either segment stays general.

8. A retailer buys the product at a lower price than it sells it for and keeps the difference [1]. The producer therefore receives less per item than it would from selling directly [1], which reduces its revenue and profit unless the retailer buys enough extra units to make up for it [1]. [3] Examiner insight: A strong answer links the retailer’s share to the producer’s revenue. “Retailers are expensive” alone stays at one point.

9. (a) Retailer’s share = £16 − £10 = £6 [1]. £6 ÷ £16 × 100 = 37.5% [1]. [2] (b) Kept online = £15 − £3.50 = £11.50 [1]. Difference from the retailer route = £11.50 − £10 = £1.50 more per mug [1]. [2] (c) A retailer already has customers who visit the shop, so Corbel reaches buyers it has not had to find itself [1]. Customers can see and handle the mug before buying [1], which may help sales of an item they would otherwise worry about receiving broken [1]. The retailer may order large quantities, giving Corbel steady volume, whereas online sales depend on Corbel promoting its website and paying for delivery and breakages [1]. [4] Examiner insight: In part (b), subtract the costs from the online price before comparing. Part (c) is stronger where points use the stem, here breakage in the post.

10. A higher price tends to signal quality or exclusivity [1], so promotion should stress the quality and reliability that justify the price, not low prices or discounts [1]. It should also be aimed at customers willing to pay more, for example through branding that suggests a premium product [1]. [3] Examiner insight: Answers tend to gain credit when they say what changes in the second element, here promotion. Stating that price and promotion are “connected” is not enough.

11. Option A: 5% × 1,500 = 75 buyers [1]. Revenue = 75 × £40 = £3,000, which is £600 above the £2,400 cost [1]. Option B: 0.8% × 12,000 = 96 buyers, revenue = 96 × £40 = £3,840, which is £2,340 above the £1,500 cost [1]. The cost per buyer is £32 for Option A and about £15.63 for Option B [1]. In favour of Option A, sponsorship can build awareness and goodwill that last beyond the season, and the figures are forecasts [1]. I recommend Option B, because it brings more buyers for less money, and it is aimed at the exact segment, though Aldous should check the 0.8% against actual results [1]. [6] Examiner insight: A justify answer tends to gain credit when it uses the figures in the stem and ends with a clear recommendation. These revenue figures ignore the cost of making the bundles, so treat them as a first comparison.

12. In favour: the product, price, place and promotion fit one message. Organic quality and a premium price of £14 [1], independent pet shops and a website [1] and sponsorship of local dog shows reaching committed owners [1] all say the same thing, which makes the offer clear and hard for a rival to copy as a whole [1]. Against: the supermarket price of £8 is well below £14 and the product is available in every branch with television adverts, so it reaches far more people [1]. Kirkstead probably has a much smaller promotion budget than a supermarket chain, so it is unlikely to match this reach [1]. The advantage only lasts if the target market values organic quality enough to pay the extra £6 a bag [1]. Overall, I judge that Kirkstead can keep its advantage with owners who put quality first, because the mix is consistent, but it will probably lose price-sensitive buyers, so it should watch sales for signs of switching [1]. [8] Examiner insight: An evaluate answer tends to gain credit when it weighs the mix against the rival’s threat and reaches a supported conclusion. Describing the mix only stays descriptive.

Where marks are usually lost

• Defining branding as only a logo or a name.
• Naming a promotion strategy without linking it to the segment in the stem.
• Giving “social media” for viral advertising with no mention of sharing.
• Not linking the retailer’s share to the producer’s reduced revenue.
• Dividing a percentage change by the new figure.
• Forgetting to subtract delivery and packaging costs when comparing online and retailer routes.
• Describing the four elements one by one when asked how one influences another.
• Claiming a competitive advantage without saying what rivals offer.
• Finishing a justify or evaluate answer without a supported judgement.

Next steps

• Recap with the revision notes and the study guide.
• Course hub: Edexcel GCSE Business and the printable checklist.
• Take the free diagnostics to see where to focus.
• Book a free trial class.

Frequently asked questions

What do these promotion and place practice questions cover? They follow Pearson Edexcel GCSE Business (1BS0) Theme 2 items 2.2.3 to 2.2.5: promotion strategies, technology in promotion, retailers and e-tailers, and how the marketing mix elements combine to build competitive advantage.

What are common mistakes on promotion questions? Naming a promotion strategy without linking it to the segment in the case, defining branding as only a logo or name, and writing “social media” for viral advertising with no mention of people sharing it.

How do you compare selling through a retailer with selling online? Work out the money received per item on each route, remembering to subtract delivery, packaging and payment costs from online sales. Then consider volume, since a retailer may sell many more units.

What does an integrated marketing mix mean? A mix is integrated when product, price, place and promotion all point in the same direction, so customers see one clear offer. Conflicting elements confuse the offer and give rivals an opening.

Official syllabus

Pearson Edexcel Level 1/Level 2 GCSE (9-1) in Business (1BS0), Specification, Issue 2, July 2022, published by Pearson Education Limited. Theme 2: Building a business, topic 2.2 Making marketing decisions, content items 2.2.3 Promotion, 2.2.4 Place and 2.2.5 Using the marketing mix to make business decisions.