OCR GCSE Business: Marketing (J204) – Revision Notes

Quick recall for section 2, Marketing, of OCR GCSE (9-1) Business (J204), Version 2.0 (January 2026), topics 2.1 to 2.4. For full explanations and worked examples, read the study guide. Then test yourself with the practice questions. The wider component is covered in the Business 1 overview, the overview revision notes and the overview practice set. Course links: OCR GCSE Business hub, printable checklist and free diagnostics.

2.1 Role of marketing

Three jobs, all named in the specification.

• Identify and understand customers
• Inform customers
• Increase sales

Link each to the business in the question.

2.2 Market research

Purpose: to identify and understand customer needs.

Primary (first-hand)	Secondary (already exists)
Questionnaires	Newspapers and magazines
Interviews	Census
Trialling	Websites
Focus groups	Internal data

Primary	Secondary
Fits the exact question	Cheaper and quicker
Up to date	May be old or gathered for another purpose
Slower and costlier	Rivals can see it too

Which method for which purpose?

• Opinions and reasons: interview or focus group
• Many people, simple answers: questionnaire
• Reaction to a real sample: trialling
• Size of a group in an area: census
• Past sales trends: internal data
• Cheap and fast start: secondary sources

Qualitative versus quantitative

• Quantitative: numbers (counts, percentages, averages). Shows how many.
• Qualitative: opinions and reasons. Shows why.
• Use both. A percentage with no reasons leaves the next step unclear.

2.3 Market segmentation

Segmentation splits a market into groups. The five bases in the specification are age, gender, income, location and lifestyle. Benefit: the whole mix can be aimed at one group. Drawback: extra research and sometimes extra products.

2.4 The marketing mix

The four Ps: product, price, promotion, place. They must fit together.

P	Content to know
Product	Design, invention (brand new), innovation (improvement); life cycle stages
Price	Skimming, cost-plus, penetration, competitor, promotional
Promotion	Point of sale; advertising
Place	Digital and physical distribution channels

Product life cycle: introduction (low sales), growth (fast rise), maturity (peak, flat), decline (falling).

Pricing methods

Method	Remember
Skimming	High first, then lower. New product, few rivals
Penetration	Low first to win share. Crowded market
Cost-plus	Unit cost plus mark-up. Ignores rivals
Competitor	Close to rivals. Similar products
Promotional	Short-term cut. Stock clearance, attention

Point of sale: price reductions, loss leaders, competitions, free samples.

Advertising: social media, websites, print media, television, radio. Choose by audience, reach and cost.

Place: shop, market stall, website, app, online marketplace. Digital reaches further; physical lets people see and touch.

Using the mix: match the change to the problem. Falling share might need a price or promotion change. A new segment might need a new product or channel.

Formulas

The specification does not print these, so each is the standard form.

Measure	Formula
Percentage	part / whole × 100
Percentage change	(new - old) / old × 100
Market share	business sales / total market sales × 100
Cost-plus price	unit cost + mark-up
Average (mean)	total / number of values

Method for market share questions

1. Write the formula.
2. Put both sales figures in the same units (pounds, or thousands of units).
3. Divide, multiply by 100, and add a % sign.
4. Say what it means: share rising means the business is growing faster than the market.

Reading market data: compare the business with the market. Sales up 10% in a market up 15% is a loss of share.

Worked reminders

Market data. A market for gym memberships is worth £600,000 in a year. Wynstay’s sales are £48,000, so its share is 48,000 / 600,000 × 100 = 8%. If the market then grows to £640,000 and Wynstay’s sales reach £54,000, the new share is 54,000 / 640,000 × 100 = 8.4% (to 1 decimal place). Wynstay’s sales grew 12.5% against market growth of 6.7%, so it is gaining share.

Mean. Four weeks of new members: 18, 24, 21, 33. Total 96, divided by 4 gives a mean of 24 a week.

Cost-plus and promotion. A day pass costs £6 to provide. A 50% mark-up gives £9. A promotional price of 20% off is £7.20, which still covers the cost with £1.20 left over.

Command words in this topic

Command word	What the answer needs
Identify, State	A short fact, no development
Explain	A point linked to the business, with a reason
Calculate, Complete	Formula, working and the final figure with units
Analyse	A chain of reasoning: point, because, so, which means
Discuss, Evaluate	Both sides weighed, then a supported judgement
Recommend	A clear choice backed by reasons

For analysis, use the chain: the gym lowers its joining fee, so more people can afford to join, so membership rises, which could raise income from monthly fees. For evaluation, finish with a decision and a reason for it, such as “penetration pricing is right because the market is crowded, as long as the fee rise later does not drive members away”.

Case-study checklist

Before you write, underline the target market, the stage the product has reached, the budget and the channel in the stem. Then ask four questions.

1. Which part of the mix is the question about?
2. Who is the target customer, and how would they be segmented?
3. What does the data show, and how does it compare with the market?
4. Which other P would be affected by this choice?

Linking the Ps in a case study

Examples of fit and clash, to use as models.

• Fit: a premium gym sets a high monthly fee (price), offers new equipment and small classes (product), advertises in a lifestyle magazine (promotion) and has one central site (place).
• Clash: the same gym advertises large discounts on social media and fills the building with cheap equipment. The price signal and the product signal disagree.
• Fit: a low-cost gym uses penetration pricing, free trial passes (a free-sample style offer) and a website for sign-up.

When you meet a new business in an exam, run the same check. Name each P, then say whether the four tell one story to the chosen segment.

Distinctions to keep clear

• Primary or secondary: who collected it, and for what
• Quantitative or qualitative: numbers or reasons
• Invention or innovation: brand new or improved
• Skimming or penetration: high first or low first
• Loss leader or promotional price: one item to draw shoppers in, or a temporary cut to an ordinary product
• Percentage points or percentage change: share going from 13% to 14% is one point, but a 7.7% rise in share

Quick self-test

Wynstay Fitness runs gyms. Answer these.

1. State the three purposes of marketing named in the specification.
2. Give two examples of primary research.
3. Give two examples of secondary sources.
4. Wynstay sells 650 memberships in a local fitness market of 5,000 memberships. Calculate its market share.
5. Wynstay’s monthly sales rise from £48,000 to £54,000. Calculate the percentage change.
6. A smoothie bar costs £4.50 to make and sells at cost plus a 30% mark-up. Calculate the price.
7. Visits fall from 500 to 425 in a week. Calculate the percentage change.
8. In a survey of 150 members, 90 want evening classes. What percentage is this?
9. Name the pricing method: a gym sets a very low joining fee to attract as many new members as possible.
10. State which stage of the product life cycle shows falling sales.
11. Explain one reason a gym might use a focus group rather than a questionnaire.
12. Explain one reason segmenting by lifestyle could help a gym.

Answers

1. Identify and understand customers; inform customers; increase sales.
2. Any two of questionnaires, interviews, trialling, focus groups.
3. Any two of newspapers and magazines, census, websites, internal data.
4. 650 / 5,000 × 100 = 13%.
5. (54,000 - 48,000) / 48,000 × 100 = 12.5% increase.
6. 30% of £4.50 = £1.35, so the price is £5.85.
7. (425 - 500) / 500 × 100 = -15% (a 15% fall).
8. 90 / 150 × 100 = 60%.
9. Penetration pricing.
10. Decline.
11. A focus group lets members explain why they feel as they do and respond to each other. A questionnaire gives short answers with little explanation.
12. Lifestyle groups, such as people who train daily, want different classes and hours. The gym can design and advertise the offer for the group it targets.

Where marks are usually lost

• Naming a method but not saying why it suits the purpose.
• Writing that primary research is “better” without a reason.
• Giving a market share figure with no interpretation.
• Dividing by the new figure instead of the old one in a percentage change.
• Forgetting the % sign or the direction (increase or fall).
• Listing the four Ps without judging whether they fit the target market.
• Applying skimming or penetration to the wrong kind of market.
• Using general statements instead of the business named in the stem.

Frequently asked questions

What are the three purposes of marketing in OCR GCSE Business? The OCR GCSE Business (J204) specification names three: identifying and understanding customers, informing customers, and increasing sales. Link each to the business in the question.

What are the stages of the product life cycle? The stages are introduction with low sales, growth with a fast rise, maturity where sales peak and flatten, and decline where sales fall. Extension strategies can be used to delay decline.

Which research method suits which purpose? Interviews or focus groups suit finding out opinions and reasons, questionnaires suit collecting simple answers from many people, trialling suits seeing how customers react to a real sample, and the census suits finding the size of a group in an area. Naming a method without saying why it suits the purpose loses marks.

Is primary research better than secondary research? Neither is always better. Primary research fits the exact question and is up to date, while secondary research is cheaper and quicker, so the right choice depends on what the business needs to find out.

Official syllabus

OCR GCSE (9-1) in Business (J204), Version 2.0, OCR, section 2: Marketing, topics 2.1 to 2.4.