1.1 Meeting Customer Needs

Question 1

Niche and mass markets definitions and +-

Answer 1

Niche- business targets small segment on a large market, more specific
Mass- business sells into largest part of market , general products

+ niche= less competition, can charge higher price
- likely to attract competition, lacks economy of scale (many products)

Question 2

Dynamic markets

Answer 2

Changing markets can be impacted by technology e.g camera market disturbed by new tech (iphone)

Question 3

Risk and uncertainty

Answer 3

R- the possibility things will go wrong e.gmaking an investment
U- the unpredictable uncontrollable events e.g sales success after launch of new product.

Question 4

Market research

Answer 4

Can provide insights like dimensions of market,competitor strategies (ups), need and wants of customers, market segments.

Question 5

Product orientation and market orientation

Answer 5

P- business develops products based on what it is good at doing.
M- business responds to what customers want and need.

Question 6

Primary and secondary research +-

Answer 6

Primary- data collected first hand (surveys,observations)
Secondary - data that already exists (market reports,Google)

P+, kept private not public -, time consuming.
S+, quick to access and use-, can becoming quickly out of date.

Question 7

Quantitive and qualities data +-

Answer 7

Quantitive, numerical and data,+easy to compare and read,-doesn’t explain reasons behind.

Qualitative , based on opinions ,+ can highlight issues (why customers don’t buy),- based around opinions maybe not representative.

Question 8

Sampling in market research

Answer 8

Gathering data from a sample of respondents, should be representative of population.
+ even a small sample size if representative can be useful .
- risk of bias in research questions.

Question 9

Market segmentation +-

Answer 9

Dividing market into parts reflecting different customer wants and needs.
1.demographics (age,gender,ethnicity)
2.income

+focuses on parts of the market where business can succeed
-markets are increasingly dynamic, so are the segments

Question 10

Market positioning on a market map +-

Answer 10

E.g High quality,low quality, high price, low price

+ helps to spot gaps in market
+ analyse competitors
- just because there’s a gap doesn’t mean there’s a demand
- no guarantee of success

Question 11

Product differentiation

Answer 11

Effective differentiation allows a business to- source a competitive advantage, strengthen customer loyalty, add more value