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A LEVEL BUSINESS - ALL > 1.1 meeting customer needs > Flashcards

1.1 meeting customer needs Flashcards

1
Q

what is a market?

A

places where buyers and sellers come together to trade goods

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2
Q

why do risks exist?

A

because entrepeneurs commit resources that could be lost

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3
Q

why does uncertainty exist?

A

businesses operate in an ever changing market and are subject to changing external environments

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4
Q

what does marketing involve?

A

-understanding customer needs
-understanding the dynamics of the market
-developing successful products
-promoting the business and its products

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5
Q

mass market

A

targets a large population of the market with a generic product

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6
Q

main facts about mass markets:

A

-mass production/large scale production
-lots of competition
-lots of promotion needed
-economies of scale

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7
Q

niche markets

A

targets a small population of the market with a specialised product

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8
Q

main facts about niche markets

A

-small scale prod, sometimes bespoke
-low volumes, high profit margins
-few competitors
-mainly focus on quality and customisation

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9
Q

dynamic markets

A

markets that are constantly changing due to aspects such as innovation, economic growth, changes in legislation and social change

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10
Q

how can market size be measured?

A

by value (total amount that customers have spent on products) OR by volume (total quantity sold by businesses)

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11
Q

who are the most successful businesses in a dynamic market?

A

businesses that can adapt and keep up with the changes in the market

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12
Q

how does having low competition affect how a business operates and the experience of customers?

A

business:
-can dominate the market
-set high prices

customers:
-limited choice
-high prices
-poor service

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13
Q

how does having high competition affect how a business operates and the experience of customers?

A

business:
-competitive pricing
-focus on constant improvement

customers:
-lots of choice
-good value for customers
-exciting new product development

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14
Q

which stage of the marketing process is market research?

A

the first

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15
Q

what is they key thing that market research shows?

A

customer needs

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16
Q

the market research process:

A

1) define problem/question

2) develop market research plan

3) collect data

4) analyse data

5) interpret and report findings

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17
Q

questions that market research wants to answer:

A

-who are potential customers
-what do our customers want
-what are customers willing to pay

-how big is the market, is it growing
-who are our competitors
-is there a gap in the market

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18
Q

what is primary research?

A

research that is collected first hand

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19
Q

advantages of primary research:

A

-specific to needs of the business
-up to date → reliable
-often better for qualitative data

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20
Q

disadvantages of primary research:

A

-more time consuming
-more expensive
-difficult to conduct a large sample size

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21
Q

what is secondary research?

A

research that already exists, conducted by someone else

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22
Q

advantages of secondary research:

A

-easily accessible
-fast & less time consuming
-often better for quantitative data

23
Q

disadvantages of secondary research:

A

-detailed reports can be expensive
-not always up to date or specific to business

24
Q

product orientated

A

focused on product efficiencies and the improving product itself

25
market orientation
focused understanding customers and developing products that meet their needs
26
which orientation do the most successful businesses tend to have, why?
market orientation, as businesses can only succeed in a competitive market if they meet the needs of customers better than their rivals
27
limitations of market research
-often biased -a small sample limits the **reliability** of the research -collecting is time consuming
28
what can market research be used to do?
-develop products -make a cash flow forecast -budget -develop marketing activities
29
sampling
sampling involves selecting a representative group of people from the target population
30
advantages of samples:
-quicker and easier than trying to collect research from everyone -the bigger the sample, the more representative it will be
31
correlation
the relationship between two factors
32
correlation doesn’t always mean c_________
causality
33
how can the internet be used to collect market research data?
-collecting data through websites -social media -analysing information in databases
34
market segmentation
breaking the market into smaller groups based on certain characteristics
35
advantages of market segmentation:
-helps a business differentiate itself from competitors -helps a business develop and build its brand -helps a business identify and satisfy the needs of a specific group of customers -helps a business reach its customers with relevant marketing activities such as advertising -helps a business build loyalty towards its brand and products
36
what is a market map?
a technique used to understand how products/businesses are viewed relative to competitors, based on two characteristics
37
benefits of market maps
-helps businesses decide whether to set up in a market (is there a gap?) -is useful for comparing the similarities and differences between businesses (market positioning) -helps a business gains better understanding of its competitors -useful as a market research tool to gain an understanding of customer perceptions
38
limitation of market maps
only considers two main variables - markets and customer perceptions are complex
39
factors a business may consider when positioning a product or the business?
-the attributes of the product (features & quality) -classification of the product or business
40
head to head competition
-there isn’t always a gap in the market for a business to be successful -businesses can target the same customers as other businesses & still be successful if there’s enough demand/if they meet customer needs better than competitors
41
competitive advantage
a set of **unique** features of a business and its products that are perceived by customers as better than competition
42
how do businesses usually achieve competitive advantage?
differentiate their products from those of competitors
43
ways to differentiate:
-USP (unique brand characteristics/unique product features) -better customer experience -good relationships with customers -price -brand
44
what does differentiation do about competition?
it means that businesses don’t have to position themselves along rival firms
45
which three ways can a sustainable competitive advantage be achieved?
-innovation -architecture -reputation
46
innovation
the successful creation, development and implementation of a new product, process or service
47
architecture
refers to the relationships within a business that create synergy and understanding between suppliers, customers and the employees of a business
48
reputation
the way a business and its activities are perceived by the public
49
why can each of these three factors lead to a sustainable competitive advantage?
they are all unique, not easily copied and take a long time to achieve
50
what is the basic purpose of all businesses?
adding value
51
steps of adding value: (inputs, processes, outputs)
inputs: labour, capital, raw materials transformational processes: add value outputs: goods & services
52
different ways to add value:
-branding (developing a strong brand identity through promotion) -better design/features -customisation -packaging -good customer service
53
the more value a business can add…
the higher the price & the greater the profit margin

A LEVEL BUSINESS - ALL (12 decks)

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