W 5: The 4 Ps Of Ballooning
For more information about how hot-air balloons are marketed and the way the market is split, you may want to look at the explanation of marketing. This worksheet looks at the marketing mix. For some more detail about the marketing mix you could also look at the marketing theories section.
A printable version of this worksheet is available for filling in answers.
Step 1 - Which P is which?
What are the 4 Ps of the marketing mix?
Now imagine that you are marketing hot-air balloons, rank these 4 Ps in order of importance to Cameron Balloons. Start with number 1 as the most important.
Write a short paragraph for each of these choices, justifying your reasons for ranking it as you did.
Step 2 - The price is right?
One of the key elements of the marketing mix is the price. Use your textbook or course book to find out the different methods of setting the price given below that Cameron Balloons could use.
- Absorption costing
- Cost-plus pricing
- Contribution pricing
- Competition-based pricing
Which of these methods do you think would be most appropriate to Cameron Balloons? Why?
It is probably an oversimplification to suggest that Cameron Balloons could use just one pricing strategy. The products they produce have very different characteristics. For example, let's compare the production of standard balloons which tend to have a consistent design and special balloons - each of which is a unique one-off. Fill in the table below to show how the costs of each balloon vary. (If you are unsure about the difference between direct and indirect costs, you may want to have a look at the production theories section.)
| Balloon type | Indirect costs | Direct costs |
|---|
| | High or low? | High or low? |
| Standard balloon | | |
| Special shape balloons | | |
What difference might this information make to the pricing strategy for each type of balloon?
Step 3 - The place is right?
The place part of the marketing mix is concerned with the distribution of the product. With a small and well-informed market like the hot-air balloon market, distribution in the UK is relatively straightforward. This is further simplified given that Bristol is one of the ballooning centres of the UK and that is where Cameron balloons is located.
However, international distribution is more complex. Read through the marketing explanation section to find out how Cameron Balloons organise their international distribution. Write a short summary of this.
Summarise the channels of distribution for selling balloons in the UK, and overseas. Use your textbook to look up where necessary. Start with the firm and write down each further stage of the distribution.
