Extension Strategies and the Product Portfolio - Worksheets, Questions and Revision

15 original exam-style questions - 4 pages of questions with a full mark scheme - free printable PDF.

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This topic is chapter 9 of GCSE Business: Marketing Practice Book.

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2.9 Extension Strategies and the Product Portfolio

AQA 8132 · Calculators not allowed · about 60 minutes

Total Marks

Name: _______________________________ Date: ____ / ____ / ______

Answer ALL questions in the spaces provided. Use the Oak & Ember Foods scenario in questions that name it. Show brief reasoning where asked.

Which one of the following is an example of using advertising as an extension strategy for a product in the maturity stage?

A) Increasing the price of the product
B) Removing the product from all shops
C) Running a new advertising campaign to remind customers about the product
D) Reducing the size of the product without changing the price

(Total for Question 1 is 1 mark)

Oak & Ember Foods' Summer Chutney sales fell by 8% last year. Which one of the following best describes a pricing extension strategy the firm might use?

A) Increasing wholesale prices to reduce demand
B) Reducing the retail price temporarily to stimulate purchases
C) Charging a subscription fee for employees
D) Increasing fixed costs to fund adverts

(Total for Question 2 is 1 mark)

Which one of the following best describes a portfolio advantage for Oak & Ember Foods when one product's sales fall?

A) The business must close immediately
B) Other products can provide revenue to cover shortfalls
C) All products will also decline at the same rate
D) The business cannot invest in promotion

(Total for Question 3 is 1 mark)

Identify two ways Oak & Ember Foods could improve Summer Chutney itself, rather than its packaging or price, as an extension strategy.

(Total for Question 4 is 2 marks)

In the Oak & Ember Foods scenario, identify two extension strategies that involve changing how the product is presented to customers.

(Total for Question 5 is 2 marks)

Identify two non-price extension strategies Oak & Ember Foods could use for Summer Chutney other than rebranding or repackaging.

(Total for Question 6 is 2 marks)

Explain one way Oak & Ember Foods could find new markets for Summer Chutney, for example exporting to another EU country, and how this could extend the product life.

(Total for Question 7 is 3 marks)

Explain one reason Oak & Ember Foods might change packaging design to make Summer Chutney suitable as a gift item, and how that could increase sales.

(Total for Question 8 is 3 marks)

Identify two internal benefits Oak & Ember Foods gains from having a product portfolio containing items at different life-cycle stages, using Summer Chutney and the spicy jam example.

(Total for Question 9 is 2 marks)

State two limitations of relying only on extension strategies to keep Summer Chutney selling, without developing new products.

(Total for Question 10 is 2 marks)

Explain one way that launching a new, spicier variant of Summer Chutney could extend the product's life for Oak & Ember Foods.

(Total for Question 11 is 3 marks)

Explain how rebranding Summer Chutney, for example giving it a modern label and new story about local ingredients, could extend the product's life for Oak & Ember Foods.

(Total for Question 12 is 4 marks)

Explain how Oak & Ember Foods could use customer feedback on Summer Chutney to inform an extension strategy and give one possible outcome of doing so.

(Total for Question 13 is 4 marks)

Oak & Ember Foods must choose ONE extension strategy to focus its limited marketing budget on for Summer Chutney: launching a new spicier variant, or running a fresh advertising campaign reminding customers about the existing product. Recommend which extension strategy Oak & Ember Foods should choose, justifying your answer using the case and weighing both options.

(Total for Question 14 is 9 marks)

Analyse why holding a portfolio of products at different life-cycle stages benefits Oak & Ember Foods, which currently has Summer Chutney in maturity and a new spicy jam in growth.

(Total for Question 15 is 6 marks)

Mark scheme · 2.9 Extension Strategies and the Product Portfolio

Question 1

B1 C cao
Answer: C

Question 2

B1 B cao
Answer: B

Question 3

B1 B cao
Answer: B

Question 4

B1 adding a new flavour variant, e.g. a spicier version of Summer Chutney
B1 improving the recipe or ingredients, e.g. using higher-quality or more natural ingredients
Answer: Any two, for example: adding a new flavour variant, such as a spicier version; improving the recipe or using higher-quality ingredients.

Question 5

B1 repackaging the product
B1 rebranding the product
Answer: Repackaging; rebranding.

Question 6

B1 finding new uses or recipe ideas for the chutney
B1 finding new markets or export opportunities
Answer: New uses or recipe ideas; finding new markets or export opportunities.

Question 7

B1 identifies the action, e.g. exporting to a new country
B1 explains how accessing new customers increases potential sales
B1 links increased sales to delaying decline and extending the product's commercial life
Answer: Exporting Summer Chutney to a new country opens the product to new customers and retail channels; this increases potential sales and demand, which can delay the decline in domestic sales and extend the product's overall commercial life.

Question 8

B1 identifies the change, e.g. special gift packaging
B1 explains how that can create new purchase occasions and appeal to different buyers
B1 links new purchase occasions to increased sales and extended product life
Answer: Using special gift packaging creates new purchase occasions, appealing to shoppers buying presents rather than food staples. This attracts different buyers and increases sales occasions, which can raise overall sales and help extend the chutney's commercial life.

Question 9

B1 steady cash flow from mature products like Summer Chutney
B1 future profit potential from growth products like the spicy jam
Answer: Steady cash flow from mature products; future profit potential from growth products.

Question 10

B1 extensions may only delay decline and not reverse market shifts
B1 constant changes can increase costs and may fatigue customers
Answer: Extension strategies may only delay decline rather than reverse long-term market changes; repeated changes can raise costs and fatigue customers.

Question 11

B1 identifies point, e.g. a new variant gives existing customers a reason to try the product again and may attract new customers who prefer spicier food
B1 develops, e.g. this can increase sales without Oak & Ember Foods needing to develop and launch a completely new product line
B1 links to outcome, e.g. it can help the product regain some of the interest and sales it had earlier in its life cycle, delaying its fall into decline

Question 12

B1 identifies rebranding action, e.g. new label and story
B1 explains how this can attract new or younger customers
B1 explains it can differentiate the product from competitors
B1 links these effects to extended sales and a longer commercial life for the product
Answer: Rebranding by updating the label and emphasising local ingredients can attract new or younger customers and make the chutney look fresher compared with rivals, differentiating it on the shelf. These effects can increase or stabilise sales and so extend the product's commercial life.

Question 13

B1 identifies gathering customer feedback as the action
B1 explains how feedback can reveal desired flavours, pack sizes or uses
B1 explains how this information can guide specific changes, such as a new flavour or recipe suggestions on the pack
B1 links the change to an outcome, e.g. increased sales or stronger customer loyalty extending product life
Answer: Gathering customer feedback identifies what buyers like or dislike, such as preferred flavours, pack sizes or suggested uses. Using this information Oak & Ember Foods could launch a new variant or include recipe ideas on the pack, which can increase relevance, encourage repeat purchases and strengthen loyalty, thereby increasing sales and extending the product's commercial life.

Question 14

Level 1 (1-3): Makes simple or one-sided points about one option, with limited application to Oak & Ember Foods.
Level 2 (4-6): Gives a developed argument for one option, uses some of the case, and considers at least one alternative, but the evaluation is not fully balanced or the recommendation is not strongly justified.
Level 3 (7-9): Weighs the likely benefits and drawbacks of both options in the Oak & Ember Foods context, uses specific evidence from the case, and reaches a clear, justified recommendation.
Indicative content:
- New variant: could attract new customers and give existing customers a reason to buy again, potentially opening a new segment such as spice lovers; however it needs development time and new production costs, and carries the risk of low take-up if the flavour does not appeal.
- Advertising campaign: relatively quick to launch and can directly remind lapsed customers that Summer Chutney still exists, which may help recover some of the 8% sales fall mentioned in the case; however it does not change the product itself, so if customers have simply moved to a rival product, advertising alone may not be enough.
- Portfolio context: Oak & Ember Foods already has a new spicy jam in growth, so resources may be limited; committing heavily to product development for the chutney at the same time could stretch the business, whereas an advertising campaign is likely to be cheaper and faster to organise.
- Comparative judgement: a new variant offers a potentially bigger, longer-lasting boost to sales if it succeeds, but at higher cost and risk; advertising is lower-risk and quicker to run, but its effect may be smaller and more short-lived.
- Justified recommendation: given the spicy jam is already using development resources, a reasoned answer could recommend the advertising campaign first as the lower-cost, lower-risk option to test whether awareness alone can revive sales, keeping the new-variant idea in reserve; or argue for the new variant if the business can afford it and believes changing tastes are the underlying cause of the sales fall.

Question 15

Level 1 (1-3): Provides simple, limited analysis of benefits, with little use of the named products and weak linkage to business outcomes.
Level 2 (4-6): Provides developed analysis that uses the example of Summer Chutney and the spicy jam to explain how products at different stages support revenue, cash flow and risk management.
Indicative content:
- A product in maturity like Summer Chutney may provide steady sales and cash that can fund promotion or R&D for new products, such as the growing spicy jam.
- A product in growth, like the spicy jam, can expand market share and future profits, offsetting declines in mature lines.
- Portfolio balance spreads risk, because if Summer Chutney enters decline the growing jam still brings revenue, reducing the impact on total business cash flow.
- Different products allow targeting of different customer segments and retailers, helping Oak & Ember Foods maintain overall market presence.
- Judgement might consider how much reliance on Summer Chutney is acceptable and the need to invest part of mature-line cash into supporting growth-stage products.

Extension Strategies and the Product Portfolio - Worksheets, Questions and Revision

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2.9 Extension Strategies and the Product Portfolio

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