1.1- Meeting Customer Needs

Question 1

What is Marketing?

Answer 1

process involved in identifying, anticipating and satisfying consumer requirements profitably.

Question 2

What is a Mass Market?

Answer 2

where business sells into larger part of market where there are many similar products offered by competitors

Question 3

What is a Niche Market?

Answer 3

where business targets smaller segment of a larger market where customers have specific needs and wants

Question 4

Name 3 benefits of being in a mass market?

Answer 4

-widest potential customer base

-lower risk

-low unit costs

Question 5

drawbacks of being in a mass market?

Answer 5

-Highly competitive
-Requires large investment in marketing

Question 6

benefits of being in a Niche market?

Answer 6

-less competition

-profit margins higher

-customers tend to be more loyal

Question 7

drawbacks of being in a Niche Market?

Answer 7

-vulnerable to market changes

-risk of over dependence on a single product

Question 8

What is Market Size?

Answer 8

the total volume of a market
- in terms of number of sales or value of sales

Question 9

Mass markets characteristics

Answer 9

-generic products- similiar in form, function
- customers form majority of market
- needs and wants more general
- higher output and capacity
- low cost, wide distribution

Question 10

Niche market characteristics

Answer 10

-speciliats products/ services
- loyal customers
- higher profit margins
- lack economies of scale
- can attract competition if successful

Question 11

What is market share

Answer 11

• the percentage/segment of a market which a business controls

Question 12

What is the Market Share Formula?

Answer 12

Sales of a business/Total sales in the market x 100

Question 13

What is a dynamic market

Answer 13

• a market which is constantly changing

Question 14

Name 3 key sources of change in a dynamic market

Answer 14

-customers tastes and preferences

-impact of tech on what customers buy & how they buy

-impact of new market entrants

Question 15

How does online retailing impact a dynamic market

Answer 15

-businesses face more competition as customers can easily shop around

-consumers- unable to physically see the products before buying

Question 16

How does online retailing benefit a market

Answer 16

buisnesses cost

Question 17

How do markets change
-summarise using PESTLE

Answer 17

PESTLE:
-political- leaving EU- change in importing and exporting

-economic- economic recession- changes in grocery retailing- ppl opted for aldi

-social- increased desire for convenience- ^ in inline retailing

-technological- apps- changed markets

-legal- growth in market for vapes- intro of new laws relating to who can buy them, advertisement, consupmtion

-environmental- car industry facing major changes- minimise damaging impact of exhaust fumes

Question 18

How does innovation cause market growth

Answer 18

-competing firms continually develop features no rivals offer- so consumer loyalties chnage drastically

-once 1 innovation is successful- companies forced to adaot offerings to keep up with rivals

-so companies try to come up with own innovations to benefit by leading change in makret

Question 19

Why do businesses have to adapt to change

Answer 19

-identifying subtle changes allows business to adapt to changes to meet customer needs

-changing earlier than rivals- major competitive advantage

Question 20

Name 4 ways competition affects the market

Answer 20

-need to drive down costs
-need to maintain compeititve prices
-need to devlop innovative prodcuts and servives
-need to maintain high quality products and servivesc

Question 21

What is product orientation?

Answer 21

-business develops products based on what it is good at doing

Question 22

What is market orientation?

Answer 22

-business responds to customer needs and wants- designs products accordingly

Question 23

What is primary research?
-give exazmples

Answer 23

-new research conducted for particular purpose

-surveys
-retailer research

Question 24

What is secondary research?
-give examples

Answer 24

-pre-existing data gathered for another purpose

-internet
-government statistics

Question 25

Advantages of primary research

Answer 25

-up to date data -detailed insights

Question 26

Advantages of secondary research

Answer 26

-often free -provides good market overview

Question 27

Disadvantages of primary research

Answer 27

-expenisve -risk of bias from imterviewer

Question 28

Disadvantages of secondary research

Answer 28

-info may be out of date -can be expensive

Question 29

What is quantitive data

Answer 29

-factual that aims to be statistically representative of the whole market

Question 30

What is qualititive data

Answer 30

-opinion- unlikely to be gathered on a alrge enough scale to give statsically reliable data -designed to give insight into why customers behave the way they do

Question 31

Name 2 reasons why market research data may be unreliable

Answer 31

-sample size too small- means more chance that respondants who dont reflect overall views of market are over-represented in smaple -sample bias- way responspendents are selected may cause certain ty[pes of people to be over-represented in the samplke

Question 32

Name 3 ways ICT supports market research

Answer 32

-websites- can gather data on vistors to website- provide info about online shoppers/ browsers interests -social media- offer info on consumer attitudes to product/ service -databases- allows vast quantities of data relating to consumers to be trwled to identify patterns that can explain how consumers behave

Question 33

What is market segmentation

Answer 33

-splitting up a market into different groups of consumers who share similar characteristics wants and needs

Question 34

3 benfits of market segmentation

Answer 34

-products and services can be designed to suit specific customers -meeting customers needs precisely allows a higher price to be charged -promotional activity is easier to target

Question 35

What is market positioning

Answer 35

deciding how you want customers to perceive your product

Question 36

What can market maps show

Answer 36

-gaps in the market

Question 37

Why are market maps beneficial for businesses

Answer 37

-by using a market map businesses can identify a gap in market -they can then produce a product that matches the gap identified

Question 38

What is competitive adavnatge

Answer 38

circumstance that puts a company in a favourable/ superior business position.

Question 39

Name the 2 major generic routes to finding a competitive advantage

Answer 39

-being lowest cost producer -finding a sustainable point of differentiation

Question 40

What is product differentiation

Answer 40

differentiating a product from others in the market to make it more appealing to the target audience.

Question 41

What are the purposes of product differentiation

Answer 41

-insulating products from actions of competitors -allowing prices to be increased without a major fall in demand/ sales

Question 42

What is added value

Answer 42

-difference between the cost of brought-in goods and services and the selling price of a product

Question 43

Why is added value good for a business

Answer 43

-charge higher prices - without increasing costs of prodcuing a product will naturally add more value- - boosts profit margins- as gap between selling price and variable costs widens

Question 44

What is a market

Answer 44

where buyers & sellers meet to exchange goods/ services

Question 45

Name 2 aims of a mass market

Answer 45

-create products with universal appeal -exploit economies of scale

Question 46

What is innovation

Answer 46

putting a new idea/ approach into action

Question 47

Name 3 benefits of innovation

Answer 47

-higher prices -^ market share -improved quality

Question 48

What is uncertainty

Answer 48

unpredictable & uncontrollable events that affect business

Question 49

What is risk

Answer 49

possibility things will go wrong

Question 50

Name 3 reasons why market orientation is crucial to marketing success

Answer 50

-markets are much more dynamic --customers are becoming much more demanding -barriers to market entry are getting lower

Question 51

What is market research

Answer 51

process of gathering data to help a business develop a product to meet customer needs

Question 52

What is monopoly power

Answer 52

large business which dominates the market