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business studies > 1.1 - meeting customer needs > Flashcards

1.1 - meeting customer needs Flashcards

1
Q

mass market

A

market is aimed at the general public e.g. regular toothpaste

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2
Q

niche market

A

subset of the main market and addresses a specialist need e.g. sensodyne toothpaste

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3
Q

homogenous

A

of the same kind
similar products that compete in the market

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4
Q

mass-market characteristics

A
  • product is sold to all consumers in the same way
  • many products can be sold on a global scale with just a few language tweaks
  • example = car market
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5
Q

advantages of mass markets

A
  • large scale production = lower unit costs
  • straightforward = equally targeted
  • large volume of sales = high revenues
  • high revenues = pumped into research
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6
Q

disadvantages of mass markets

A
  • lots of competition
  • homogenous products need to be differentiated
  • high volume production = not flexible
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7
Q

niche market characteristics

A
  • aimed at people with high incomes
  • not everyone will buy it
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8
Q

advantages of niche markets

A
  • charge premium prices
  • easier to target customers
  • small-scale production
  • less competition
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9
Q

disadvantages of niche markets

A
  • risky
  • higher unit costs
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10
Q

profitability of niche markets

A
  • profitable market to be in
  • profits can signal more competitors to enter the market
  • small range of products
  • market may be limited
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11
Q

market size

A
  • total of all sales of all producers in that market
  • measured through volume of sales and value
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12
Q

calculating market share

A

sales of a product/total sales in whole market x 100

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13
Q

dynamic market

A

a market that is subject to rapid or continuous changes

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14
Q

reasons for dynamic markets

A
  • tastes and fashion
  • online retailing
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15
Q

advantages of online retailing

A
  • always available
  • orders are taken automatically
  • international market
  • no need for premises
  • stocks can be withdrawn
  • easy to set up
  • flexible
  • fast growth
  • easily updated
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16
Q

disadvantages of online retailing

A
  • sending products back
  • online security
  • competitive market
  • owners need IT skills
  • problems with fraud
  • competitors can be aware of owner’s business activity
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17
Q

business risk

A

the exposure a company has to factors that will lower its profits or lead it to fall

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18
Q

uncertainty

A

situations in which businesses face risks that can’t be measured or calculated

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19
Q

production orientation

A

a business develops a product based on what it is good at doing

20
Q

marketing orientation

A

a business responds to customer needs and wants, and designs products accordingly

21
Q

market research

A
  • primary research = data collected firsthand (surveys & questionnaires)
  • secondary research = data that already exists
22
Q

quantitative research

A

concerned with data and addresses questions such as when, who and why

23
Q

qualitative research

A

based on opinions, attitudes, beliefs, and intentions

24
Q

benefits of primary research

A
  • directly focused on research objectives
  • kept private
  • more detailed insights
25
Q

drawbacks of primary research

A
  • time-consuming and costly to obtain
  • risk of survey bias
  • sampling may not be representative
26
Q

benefits of secondary research

A
  • often free and easy to obtain
  • good source of market insights
  • quick to access and use
27
Q

drawbacks of secondary research

A
  • can quickly become out of date
  • not tailored to business needs
  • specialist reports are often quite expensive
28
Q

benefits of qualitative research

A
  • essential for important product development and launches
  • focused on understanding customer needs, wants, and expectations
  • can highlight issues that need addressing
  • effective way of testing elements of the marketing mix
29
Q

drawbacks of qualitative research

A
  • expensive to collect and analyse
  • based on opinions
30
Q

benefits of quantitative research

A
  • data easy to analyse
  • numerical data provides insights into relevant trends
  • can be compared with data from other sources
31
Q

drawbacks of quantitative data

A
  • focuses on data and doesn’t explain why things happen
  • doesn’t explain reasons behind numerical trends
  • may lack reliability if sample size and method aren’t valid
32
Q

sampling

A

involves gathering data from a sample of respondents, the results of which should be representative of the population as a whole

33
Q

benefits of sampling

A
  • small sample can provide useful insights
  • can reduce risks and costs
  • flexible and relatively quick
34
Q

drawbacks of sampling

A
  • sample can be unrepresentative of population = can lead to incorrect conclusions
  • risk of bias
  • less useful in market segments where customers’ tastes & preferences are changing frequently
35
Q

market segmentation

A
  • involves dividing the market into parts that reflect different customer needs and wants
36
Q

segments

A
  • demographic
  • geographic
  • income
  • behavioral
37
Q

benefits of market segmentation

A
  • focuses resources on parts of a market where the business can succeed
  • allows a business to grow shares in markets
  • helps with new product development
  • helps make the marketing mix more effective
38
Q

drawbacks of market segmentation

A
  • imprecise science
  • doesn’t mean customers can be reached
  • markets are increasingly dynamic
39
Q

market mapping

A

process of finding the variables that differentiate brands in a market and then plotting them on a map

40
Q

uses of market mapping

A
  • identifying gaps in the market
  • identify which products to produce
  • to reposition
41
Q

competitive advantage

A
  • an advantage a business has over its competitors, allowing it to generate larger than average turnover for the industry
42
Q

product differentiation

A

where a product is different from the competition in some way

43
Q

methods of differentiation

A
  • reputation
  • customer service
  • value for money
  • product features
44
Q

added value

A

the difference between the price that is charged to the customer and the cost of inputs required to create the product or service

45
Q

ways to add value

A
  • design
  • production
  • quality
  • marketing
46
Q

benefits of adding value

A
  • more value = higher prices
  • customer loyalty
  • protection against competitors

business studies (16 decks)

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