103 markets Flashcards
what is a market
-a market is a place where buyers and sellers meet to exchange goods and services
-this can be virtual
what is competition
competition refers to the number of businesses in a market and how they Interact with each other eg.the number of supermarkets
what is a local/ global market
-local:-selling goods and services in a specific area eg. England
-global:- selling goods and services oversees/worldwide
what is a mass/ niche business
-mass:- where a business sells to the whole market and markets the product to all the consumers in the same way
-niche:- when a business targets a small segment of the overall market that has very specific needs and wants
what is a trade (b2b) market
- where a business sells goods to other business
- business to business
- operate before the product reaches the consumer eg.selling and supplying to distributors ext
what is a consumer (b2c) market
- made up of the general public who purchase the product for their own consumption -B2C (business to consumer)
what is a profit market/ service market
-product market eg. for physical tangible products
-service market eg. telecommunications services, hospitality ext
what is a seasonal market
markets that have seasonal variations eg,ice cream
(+) & (-) of niche markets
(+) possible to build strong customer loyalty
-lower levels of competition-only one section of the market is targeted
(-) potentially lower profits as the market is smaller
-changing customer tastes could make the niche disappear
(+) & (-) of mass markets
(+) more potential sales - targeting the whole market
less risky- more customers to target
(-) more competition-product hard to personalise
need to be able to operate on a larger scale meaning costs could be very high
what is market size
the total number of sale in a market as a whole
what is a market share
the proportion of total sales in a market made by one business
market share= sales of a business
——————————- x 100
total market sales
why is market share important
-it can be used as an indicator of performance for a business in relation to its competitors
-high market share is important to a business as:
-> can lead to a competitive advantage, help attract new shareholders, increases profitability
what are market trends
these are changes and developments in the buying and selling of products and services in a market
what is market segmentation
the process of subdividing a market into different subgroups of customers who have similar characteristics , needs or wants , and proving them with goods or services that meet their needs and wants
how are markets segmented
-demographic:-age , social class ,gender,income eg.banks offer different accounts to different ages
-psychographic-:targeting of groups on personality (attitudes, options, lifestyles) eg.cars-some pay want safety and capacity for the family car
-geographic:-rural , urban , global marketing often requires different products for different counties eg.McDonalds/ Coca Cola - need different ingredients in different counties
(+) of segmentation to a business and its customers
-attracts new customers - new demand - revenue
-target advertising at specific groups reduces costs/ time
-better at meeting customer needs and wants- repeat purchases - competitive advantage
(-) of market segmentation to a business and its customers
-targeting one market is risky-change in customer tastes could lead to business loosing all sales
-number of sales limited by segment size, if too small, business can’t make profit
-market research will need to be carried out-expensive/ time consuming
benefits of segmentation to customers
-can receive a product close to expectations
-make them feel like they’re getting value for their money
-because marketing is segmented- customer is aware of new features of a product
describe monopoly
-one firm dominates the market (100% of the market place ‘pure monopoly’
- they are price makers-have more power to influence the price of products as consumers have little choice to accept it even if it is high
- no close product or substitutes
- barriers to entry impossible
describe oligopoly
-few business dominate the market
- very few substitutes
-very difficult to enter
- important for businesses to differentiate and compete on advertising, quality ext- brand loyalty
describe monopolistic competition
-lots of small business in competition with each other-no firm dominates
-products are similar but slightly differentiated from each other-little branding
(+) few barriers to entry
(-) limited control over prices- accept the ‘going rate’-if charged more they would loose too much business
describe perfect competition
-large number of business- no firm dominates
-products are identical-no product differentiation
(+)low barriers to entry
(-)all buyers and sellers have perfect information about each other-no influence on price-if firm asks for higher price than another firm-customer would buy from competitor-product is identical
how are consumers protected from exploitation from businesses
-laws protect consumers from- poor quality goods that aren’t fit for purpose or match the description given, business misleading them about price
-trading standards department-checks business are complying with trading laws, trading offices visits businesses-see if goods are correctly priced, described ext
