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BUSINESS theme 1 > 1. meeting consumer needs p2-11 > Flashcards

1. meeting consumer needs p2-11 Flashcards

1
Q

market definition

A

buyers and sellers that trade a particular type of product in a particular place

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2
Q

niche marke

A

where businesses target a smaller segment of a larger marker - where customers have specific needs and wants

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3
Q

mass market

A
  • products in the mass market are aimed at a large group of buyers
  • product has a wide appeal and useful to a variety of people
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4
Q

examples of mass and niche market for chocloate

A
  • mass - cadbury - wide range of products which appeal to wide range or customers
  • niche - Moo Free - dairy free chocolate
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5
Q

pros and cons to mass market

A

PROS
- sells to more consumers than niche - higher sales volume
- larger production can reduce costs per unit, leading to higher profits.
- larger market size
CONS
- more competition - many businesses targeting the same consumers
- no brand loyalty

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6
Q

pros and cons to niche market

A

PROS
- less competition
- specialised products so can charge higher prices
- customer loyalty
CONS
- risky bc selling to a smaller number and narrower range of customers
- vulnerable to market changes ‘all eggs in one basket’

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7
Q

market size definition

A

total value of sales in a market over a certain time period (total number of consumers)

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8
Q

market share definition and formula

A

the proportion of the total market that the business holds
- (their sales/ total sales in the total market) x100 = %

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9
Q

branding in mass markets

A
  • essential to make their brand distinctive
  • logo, name, statement
  • recognisable
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10
Q

dynamic market definition

A

market changes and evolves rapidly

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11
Q

reasons for a dynamic market (how they change)

A
  • CONSUMER PREFERENCES - trends/technology etc
  • INNOVATION - new products emerge eg digital cameras grew and old polaroids declined
  • COMPETITION - competitors can enter or leave the market
  • LAWS - changes to legalisation eg tax on sugary drinks means a change to product so dont have to pay tax
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12
Q

pros to online retailing

A
  • businesses costs lower - no rent/ staff
  • order at any time, anywhere in the world
  • customers can compare prices easily - find cheapest option
  • eaisly create deals/discounts - appeals to customers
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13
Q

cons to online retailing

A
  • more competition
  • cannot physically see product - might not fit/wrong material etc
  • cannot speak to staff - less personal/ efficient customer service
  • personal details could be leaked
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14
Q

examples of dynamic markets

A
  • film industry —> Netflix
  • taxi services —> uber
  • camera market —> iphone
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15
Q

direct competition definition

A

2+ businesses sell SIMILAR products that appeal to the same group of customers - eg Aldi and Tesco

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16
Q

INdirect competition definition

A

2+ businesses sell DIFFERENT products for the same group of customers - eg italian and india resturants compeat for anyone wanting a takeaway

17
Q

what does competition affect and how - PPPP

A
  • PRODUCT - good quality, distinctive, unique, innovation
  • PROMOTION - promotional campaigns, advertising, branding, events
  • PRICE - cheaper than competitors - using competitive pricing stragtegies
  • PLACE - easy access - online, apps
18
Q

how does competition affect the nature of ownership

A

can be a sole trader and change to operate as a franchise - use name, idea and reputation of an existing buisness

19
Q

risk definition

A
  • the possibility that something will go wrong
  • CONTROLLABLE
  • before making a decision, businesses can consider the probability of negative outcome and try to minimise this
20
Q

uncertainty definition

A
  • unpredictable and uncontrollable events that affect a business
  • UNCONTROLLABLE
21
Q

product orientation

A
  • focuses on design, quality and performance of the product rather than what consumer actually wants
  • creates new and innovative products that they HOPE consumers like and buy
  • eg apple and new iPhones
22
Q

market orientation

A
  • selling products that match customer preferences
  • invests lots into market research to find out what the customer wants
  • charges higher prices bc its tailored to what customers want
  • low risk - based on customer feedback
23
Q

reasons why market research is important

A
  • finds out NEEDS and WANTS and anticipates them for the future
  • allows businesses to predict how much demand there will be for products therefore how much it will need to supply
  • find out if they buy more online/in-store
  • identify competitors
  • find SLEPT factors (social, legal, economic, political, technological)
24
Q

quantitative market research

A

numerical statistics eg multiple choice questionnaires
- quicker
- easier
- can be statistically ananlysed
- CLOSED QUESTIONS

25
Q

qualitative market research

A
  • opinions of consumers
  • eg ‘how did this product make you feel’
  • OPEN QUESTIONS
  • more informative and flexible
26
Q

what is primary and secondary market research

A

primary - businesses gather new data
secondary - using data already available

27
Q

types of primary market research

A
  • questionnaires
  • surveys
  • interviews
  • test marketing (launch a product in certain area and record response)
  • sampling
28
Q

pros and cons to primary research

A

pros
- good for niche markets
- competitors cannot benefit from it
- essential for a new product bc there wont be any secondary research
- specific for purpose
cons
- labour intensive
- slow
- £££££££

29
Q

types of secondary market research

A
  • government publications
  • Internet sources - Statista
  • trade magazines
  • market reports
30
Q

pros and cons to secondary market research

A

pros
- easier
- faster
- cheaper
cons
- unsuitable
- out of date
- may be errors

31
Q

samples - niche vs mass

A
  • new buisness in niche is RISKY so should spend more on accurate sampling
  • business launching product in competitive needs to do less sampling bc it knows that the product is needed by consumers
32
Q

what could and couldn’t causes BIASES in market research

A

bias - interviews (personality of the interviewer and person being interviewed)
not bias - anonymous questionaires

33
Q

ICT (information and communication technology)

A
  • helps market research
  • easier, cheaper, quicker
  • more info and wider audience
  • EG webistes, social networking and data bases
34
Q

ICT 1 websites - pros and cons

A

pros
- analyse what times of year/day website is used most
- what people are clicking on when they r on the website
- how much people are likely to spend on the website
- you can look at competitors websites
- read reviews
cons
- if ppl dont buy the product we dont know why

35
Q

ICT 2 social networking - pros and cons

A

pros
- firms can post content on social networking sites and monitor their response
- quick and cheap
- track current trends
- eg Facebook, hashtags, tiktok etc
cons
- not all consumers use the sam social media eg less older ppl on tiktok - dif results

36
Q

ICT 3 databases

A
  • eg loyalty cards - businesses can see names/adreeses and preferences of consumers
37
Q

segmentation definition

A

dividing a market into a group of buyers based on characteristics such as hobbies or age

38
Q

4 different ways to segment a market

A
  • demographic segment: age/gender/socio-economic class
  • geographic segment: city/county/country
  • income segment: DIOR makeup is targeted at high income and Superdrug at low
  • behavioural segment: amount of use/hobbies/lifestyle
39
Q

pros and cons to market mapping

A

pros
- reveals gaps in the market
- close competitors
- help make pricing strategies
cons
- based on opinion sometimes
- simplifies things too much

BUSINESS theme 1 (2 decks)

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