OxfordAQA A Level Business: Marketing — Practice Questions

These are original questions written for Marlbridge, for revision and practice on this content. They are not reproduced past-paper questions: the section layout follows the 9625 Unit 1 paper, but every question and tariff within it is Marlbridge’s own — examination boards hold copyright in their own papers. Use these alongside the official past papers available free from your board.

Related: Marketing study guide · Marketing revision notes

How this paper is laid out

This set follows the section layout of the 9625 International AS Unit 1: Business and markets paper (written exam, 1 hour 30 minutes, 80 marks), which has three compulsory sections: Section A multiple choice, short answer and data response questions worth approximately 17 marks; Section B extended response questions worth approximately 27 marks; and Section C extended response questions worth approximately 36 marks. Here the sections are worth exactly 17, 27 and 36 marks. The real Unit 1 paper also examines Topic 1 What is business?; every question below is on Topic 2 Marketing, so use it as topic practice rather than as a full mock.

If you follow 9725 (first International AS exams May/June 2027), its Unit 1 paper is different: 1 hour 15 minutes, 60 marks, in four sections (A short answer questions, 10 marks; B calculation questions, 10 marks; C extended response questions, 16 marks; D extended response questions, 24 marks). These questions also follow 9625’s 7-element marketing mix (question 11 covers people and physical environment); 9725 simplifies the mix to 4Ps, so question 11 would not apply in the same form. Check which code applies to you.

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Section A

Answer all questions.

1. Which of the following is a qualitative marketing research finding? [1] A. 42% of respondents bought the product last month B. Average spend per visit is $18 C. Focus group members described the packaging as “old-fashioned” D. Sales rose by 6% compared with last year

2. A business launches an innovative product at a price well above competitors’ prices, planning to lower it later. Which pricing strategy is this? [1] A. Price penetration B. Price discrimination C. Price skimming D. Dynamic pricing

3. Name the three types of sample included in this specification. [2]

4. Distinguish between a marketing objective and a marketing plan, giving one example of each. [4]

5. A business had 1,200 customers at the start of the year, gained 300 new customers during the year, and had 1,350 customers at the end of the year. Calculate its customer retention rate, showing your working. [3]

6. A retailer has annual sales revenue of $4.8m across 16 stores. Calculate its sales per store. [2]

7. Explain what is meant by an “extension strategy”, and why a business might use one at the maturity stage of the product life cycle. [4]

Section A total: 1 + 1 + 2 + 4 + 3 + 2 + 4 = 17 marks.

Section B

Answer all questions.

8. Explain segmentation, targeting and positioning as three connected steps, using an example of a business entering a new market. [9]

9. Explain three factors that influence a business’s choice of marketing research method. [6]

10. Using the Boston Matrix, explain the difference between a “star” and a “cash cow”, and suggest one appropriate marketing strategy for each. [6]

11. Explain, using an example, why “people” and “physical environment” matter more for a service business than for a business that only sells a physical product. [6]

Section B total: 9 + 6 + 6 + 6 = 27 marks.

Section C

Answer all questions.

12. A business estimates that the price elasticity of demand for its best-selling product is −0.4. Evaluate whether it should raise the product’s price. [12]

13. Evaluate the extent to which digital marketing and social media have changed the effectiveness of the marketing mix for a business entering an international market. [12]

14. Evaluate whether a new business should choose a niche marketing strategy rather than a mass marketing strategy. [12]

Section C total: 12 + 12 + 12 = 36 marks. Paper total: 17 + 27 + 36 = 80 marks.

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Answers

1. C [1]

2. C [1]

3. Random, stratified and quota samples: all three [2]; any two [1].

4. A marketing objective is a specific, measurable target for the marketing function [1], such as increasing market share from 8% to 10% within two years [1]. A marketing plan is the broader document setting out the marketing objectives together with the strategy, tactics and budget needed to achieve them [1], such as a plan to reach that 10% share through a social media campaign and a new distribution channel, with a $50,000 budget [1].

5. Customer retention rate = (customers at end − new customers gained) ÷ customers at start × 100 [1] = (1,350 − 300) ÷ 1,200 × 100 [1] = 1,050 ÷ 1,200 × 100 = 87.5% [1].

6. Sales per store = total sales revenue ÷ number of stores [1] = $4.8m ÷ 16 = $300,000 per store [1].

7. An extension strategy is an action taken to prolong the maturity stage of a product’s life cycle and delay its decline, such as relaunching the product, entering a new market, or modifying its features [1] [1]. A business uses one at maturity because sales growth has slowed and competition is typically at its most intense at this stage, so extending maturity defers the cost and risk of developing an entirely new product to replace declining sales [1] [1].

8. Segmentation divides the market into groups sharing similar characteristics — for example, dividing a market by demographic, geographic, income, behavioural or psychographic variables [1] [1]. Targeting is the decision about which segment(s) to serve, choosing between a niche strategy aimed at a smaller, well-defined segment or mass marketing aimed at the whole market [1] [1]. Positioning then establishes the product’s place relative to competitors for that chosen segment, communicated through pricing, packaging and distribution choices [1] [1]. For example, a business entering a market with a premium, ethically sourced product might segment psychographically around health-conscious, higher-income consumers, target that segment with a niche strategy rather than mass marketing, and position itself above mainstream competitors through specialist distribution channels [1] [1] — the positioning choice follows logically from the targeting choice, which itself follows from the segmentation variables identified first [1].

9. Any three, 2 marks each (the specification names cost, time required and reliability of findings): Cost — secondary research is usually cheaper since the data already exists, while primary research costs more but is tailored to the exact question being asked [1] [1]. Time required — secondary research is faster to access, while primary research methods such as surveys or focus groups take longer to design and run [1] [1]. Reliability of findings — a large, well-designed primary survey can give reliable, current findings, but a small or biased sample does not; secondary data may be reliable (for example official statistics) yet out of date or collected for a different purpose [1] [1]. (Also creditable: how relevant the data is to the business’s specific question.)

10. A “star” is a product with high market share in a high-growth market, generally requiring continued investment to maintain that growth position, but with strong future profit potential [1] [1]. A “cash cow” has high market share in a low-growth (mature) market, so it typically needs relatively little further investment and instead generates surplus cash that can fund other products [1] [1]. A suitable strategy for a star is to continue investing in promotion and capacity to maintain its growing market share [1]; for a cash cow, an appropriate strategy is to minimise further investment and use the cash it generates to fund stars or problem children elsewhere in the portfolio [1].

11. A service, unlike a physical product, cannot be inspected in advance and is often produced and consumed at the same time, so the customer judges quality partly from cues surrounding the service itself [1] [1]. People — staff who deliver the service (their training, attitude, appearance) directly shape the customer’s experience, since there is no separate physical product to fall back on if service is poor, for example a badly trained waiter can ruin an otherwise good restaurant meal [1] [1]. Physical environment — the tangible setting (décor, cleanliness, website design) acts as a proxy for quality the customer cannot otherwise assess before buying, for example a scruffy-looking hotel lobby signals poor quality regardless of the rooms themselves [1] [1].

12–14 (Section C) are marked as whole answers against levels. The level descriptors below are Marlbridge’s own guide, not OxfordAQA’s published mark scheme:

• Level 1 (1–3 marks): relevant knowledge of the concept, with little application to the question.
• Level 2 (4–6 marks): knowledge applied to the question, with limited or one-sided analysis.
• Level 3 (7–9 marks): developed analysis of both sides, applied to the context.
• Level 4 (10–12 marks): balanced analysis leading to a supported judgement that explains what the answer depends on.

Indicative content for 12: interpreting the data — a PED of −0.4 means demand is price inelastic, since the coefficient’s magnitude is less than 1: a 10% price rise would reduce quantity demanded by about 4%, so total revenue (price × quantity) would rise. For raising the price — revenue rises and, because fewer units are made and sold, total costs may fall, so profit is likely to rise; the product’s inelastic demand suggests loyal customers or few close substitutes. Against — PED is an estimate and not fixed: it can change as competitors respond, substitutes emerge, or the product becomes less of a necessity, and it may only hold for small price changes; a higher price may damage brand image or customer goodwill, encourage rivals to undercut, or lose customers over time even if the short-run figure is inelastic. Judgement — a price rise is likely to raise revenue in the short run, but the decision depends on how reliable the PED estimate is, how competitors react, and whether the higher price fits the rest of the marketing mix and the product’s position.

Indicative content for 13: case that digital marketing and social media have significantly changed the mix’s effectiveness — technology is an explicit influence on marketing planning in this specification, including digital marketing and the use of social media, relationship marketing, dynamic pricing, e-commerce and m-commerce; these channels allow a business entering an international market to reach and research target segments directly and cheaply, without the fixed costs of establishing physical distribution or traditional advertising in each new market; online data supports more precise segmentation, targeting and positioning. Case for limited change — the underlying logic of the marketing mix — an integrated mix matched to a targeted segment — is unchanged, and digital tools are new channels within promotion and place rather than a replacement for segmentation, targeting and positioning; the difficulties of targeting international markets persist regardless of channel, including cultural differences, language and varying regulation; for products needing physical distribution or high-touch service, traditional elements of the mix remain decisive. Judgement — digital marketing and social media have substantially lowered the cost and difficulty of reaching international segments, but they extend rather than replace the marketing mix framework; how much they change effectiveness depends on the product, the target market’s internet use and the business’s resources.

Indicative content for 14: for niche marketing — a new business usually has limited resources, and targeting a smaller, well-defined segment lets it tailor its product and promotion closely to those customers; it can build loyalty and may charge a premium price; it avoids competing head-on with large established firms that have economies of scale. Against — a niche market has fewer potential customers, which limits sales and growth; the business depends on one segment, so a change in tastes or a new competitor in the niche is a serious risk; a successful niche can attract larger rivals. For mass marketing — a larger market offers more sales potential and allows economies of scale over time. Judgement — a niche strategy usually suits a new business with limited finance and a clearly differentiated product, but the choice depends on the product, the size of the niche, the strength of competition in the mass market and the owner’s growth objectives.

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Where marks are usually lost

• Confusing a marketing objective (a specific target) with a marketing plan (the broader document).
• Describing segmentation, targeting and positioning as separate, unconnected topics rather than a chain of reasoning.
• Stating whether demand is elastic or inelastic without linking it to the resulting change in total revenue.
• Naming a Boston Matrix category without pairing it with a matching investment or marketing strategy.
• Giving a one-sided evaluation of digital marketing’s impact without weighing it against what the marketing mix framework still requires.