1.1 meeting customer needs Flashcards
What is a market
a market exists where buyers and sellers meet in order to exchange goods and services
what is a mass market
a market that produces goods and services aimed at satisfying the needs of the whole market
What is a niche market
A segment of the whole market which typically sells products specifically suited to the needs of the consumer
dynamic markets
a market which is constantly changing - e.g fashion
Benefits of mass markets
More customers / higher production levels which can allow EOS / Can use mass media ads
Benefits of niche markets
Allows premium pricing therefore higher profit margins.
How can you identify mass markets from niche
Mass markets typically sell generic products and are recognisable with branding whereas niche markets usually sell differentiated products with special features or functions
How do markets change
PESTLE: Political - income Economic - Recessions Social - taste/preferences Technology - machines vs people Legal - introduction of new laws Environmental - the need for sustainability
What is the importance of Innovation in a market
Rivals constantly compete to gain customer loyalty and being an innovative rivals gives you an advantage as well as opportunities to be the leading change within the market
How do companies adapt to change
Understanding general trends through market research
What stimulates the most change in markets?
Competition
What can competition cause
The need to drive down costs
The need to maintain competitive costs
The need to be innovative
The need to maintain high quality products
What is the Risk vs Uncertainty to a business
Risks can be predicted using statistics (quantifiable). The factors causing the risks are the uncertainties
Examples of uncertainties
The reactions of rivals or consumers
Unexpected events like economic downturns
What is Product orientation
an approach to making decisions that considers internal factors before worrying about changes in the market, This means that the business can focus on their own strengths.
What is Market orientation
when the business creates a product based off consumers desires. More likely to lead to marketing success.
What is Primary research
new research conducted for a particular purpose.
Primary research - benefits/drawbacks
BEN - the data is up to day and can address specific issues
Neg - Expensive to conduct
What is Secondary research
Uses pre-existing data that has been gathered for another purpose
Secondary research - benefits/drawbacks
BEN - Often can be free like found on the internet and is performed very large scale
NEG - The information can be out of date and not very accurate
Limitations to market research (why can it be unreliable?)
sample size is too small
sample bias
How ICT can support market research
Social media offers information on consumers attitudes towards products, show trends and build a business-consumer relationship
What is market segment
Splitting up the market into groups of consumers who share similar needs - therefore products are suited to customer needs
