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BM Business theme 1 > 1.1 meeting customer needs > Flashcards

1.1 meeting customer needs Flashcards

1
Q

What is a market?

A

A market is a place where buyers and sellers can meet.

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2
Q

What is the aim of marketing?

A

To help identify, anticipate and satisfy customer needs and wants whilst being profitable.

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3
Q

What is market research?

A

The process of systematically gathering data from consumers which can be used to influence business decisions.

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4
Q

What is a mass market?

A

Where a business sells into the largest part of the market, where there is large amounts of competition

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5
Q

What is a niche market?

A

A smaller segment of a larger market, where customers have specific wants and needs.

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6
Q

What are characteristics of a mass market?

A

Less unique products

Low average costs (economies of scale)

Lower profit margins due to lower prices

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7
Q

What are the characteristics of a niche market?

A

More specialised and unique products

High average costs (Do not benefit from Economies of scale)

Larger profit margins

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8
Q

How is market size measured

A

Sales volume- number of products sold

Sales value- price*quantity sold

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9
Q

What is market share

A

Proportion of the total sales of a product/service compared to the market as a whole.

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10
Q

What is the formula for Market share

A

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

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11
Q

What is a brand?

A

A name, image or logo which helps products/ services stand out from its competitors.

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12
Q

What are characteristics of brands?

A

Unique and protected by law

Brands add value

Brands influence the position of the business within its market

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13
Q

What is a dynamic market?

A

A market that is constantly and rapidly changing

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14
Q

What is online retailing?

A

selling products via the internet

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15
Q

Advantages of online retailing?

A

Larger amount of potential consumers

Longer trading hours

Lower costs (lower rent)

Business can collect data by tracking consumer behaviour. (primary market research)

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16
Q

Disadvantages of online retailing

A

High costs for website development and maintenance

Dominated by larger business

Lack of personal contact with consumers

May have difficulty keeping a high level of customer service

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17
Q

How/why do markets change?

A

Changing consumer tastes and preferences

The amount of competition

Changing demographics

Changing legislation

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18
Q

What is product innovation?

A

Adaptation or improvement of existing products

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19
Q

What is market growth?

A

measurement of change in the entire market expressed as a percentage of the original size.

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20
Q

Factors affecting market growth

A

Increasing population

Increasing incomes

Changing tastes and preferences

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21
Q

How may businesses adapt to change?

A

Create flexible business structures

Meet customer needs

Invest in staff training, new products and processses

Innovate to gain the first mover advanatge

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22
Q

What is the first mover advantage?

A

Competitive advantage gained by being the first business to introduce a new product/service to the market.

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23
Q

what is direct competition?

A

The business is targeting customers with the same product as the competitord

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24
Q

What is indirect competition

A

Firms sell different products but compete with each other for the disposable income of consumers. e.g. cinema and theatre companies

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25
Q

How does competition benefit the consumer?

A

Businesses offer lower prices

Businesses produce better quality products

Business provide better customer service

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26
Q

Difference between a risk and uncertainties

A

Risk are able to be calculated and prepared for. Whereas, uncertainties cannot as they are unexpected.

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27
Q

What is a risk?

A

Potential threat to a business success

28
Q

What is risk maangement?

A

The process of identifying and preparing for potential threats to business success.

29
Q

What are uncertainties?

A

Outcomes are difficult to predict

30
Q

Examples of risks

A

Technical failures

Cyber security threats

Loss of key staff

Currency fluctuations

31
Q

Examples of uncertainty

A

Will the economy go into recession?

Will energy prices continue to rise?

What will happen to interest rates?

32
Q

What is product orientation

A

An approach to marketing that focuses on the characteristics of the product rather than the needs of the consumer.

33
Q

Tools of product orientation

A

Product research

Product testing

product focus

34
Q

What is market orientation?

A

Approach to marketing that focuses on the needs of consumers and uses this information to design products that meet customer needs

35
Q

Tools of market orientation

A

Market research

Market testing

Customer focus

36
Q

What is market research

A

The objective collection, compilation and analysis of information about a market

37
Q

Market research can be quantitative and qualitative. True or False

A

True

38
Q

What is qualitative data?

A

Data based on thoughts and opinions

39
Q

What is quantitative data?

A

Numerical data

40
Q

What is primary market research

A

Process of gathering information directly from consumers in the target market.

41
Q

Methods of primary market research

A

surveys
observation
Interviews
Test marketing -free samples
Focus groups

42
Q

Advantages of primary market research?

A

Focuses on the specific needs of the business

Businesses can get in depth information

More up to date and can be used to ask specific relevant questions

43
Q

Disadvantages of market research?

A

Sample size may be unrepresentative of all customers

Bias- people interviewing may guide respondents to an answer

Expensive and time consuming

44
Q

What is secondary market research?

A

The collection, compilation and analysis of data that already exists

45
Q

methods of secondary market research

A

Market reports

government reports

46
Q

Advantages of secondary market research

A

Information is already available and so is quicker to collect (than market research)

Information is often free or cheaper

Suitable for small businesses that cant spend large amounts on marketing

47
Q

Disadvantages of secondary market research

A

May lack relevance or may even be incorrect

Information may be out of date

Can be expensive to purchase market specific data.

48
Q

The use of ICT to support market research

A

Company websites

Databases

Social networking/media

49
Q

How do company websites help market research?

A

Allow businesses to collect primary data cheaply through tracking consumer searches

50
Q

How do databases support market research?

A

Uses to store large amounts of customer information for example customer emails which can be used to send surveys to customers later on

51
Q

How does social networking/media help market research?

A

Able to gather information about consumers via social media such as twitter and tiktok. Can also be used to run quick polls with followers.

52
Q

What is market segmentation

A

the process in which a single market is divided into sub markets. e,g. healthy crisps, party crisps and value crisps

53
Q

Advantages of market segmentation

A

Recognises that consumers are not all identical

Products and marketing can be altered to meet different needs of different groups of consumers

Less expensive and wasteful

54
Q

Disadvantages of market segmentation

A

May be difficult to identify a segment

Requires more detailed market research

A segment may be too small and unprofitable

55
Q

What is market positioning

A

The process a business goes through when launching a new product or service

56
Q

Definition of market mapping

A

A tool for identifying the position of a product within a market

57
Q

What is a market map

A

A two dimensional diagram that shows the attributes or characteristics of a product in comparison to rivals products

only two criteria can be chosen. e.g. quality and price

58
Q

Advantages of market mapping

A

Market gaps can be identified

comparisons can be made between a businesses products and its rivals

59
Q

Disadvantages of market mapping

A

A gap in the market may exist because it is not profitable to fill

May require primary market research which is expensive

only two criteria can be chosen

60
Q

What is competitive advantage

A

Refers to the features of a business and its products that are perceived as superior to its rivals by customers.

61
Q

What does distinctive mean

A

Means that it is different from the competitors

62
Q

How can a business develop a competitive advantage

A

Faster delivery
Better customer service
Cheaper prices
Better designs
More ethical
Better brand image and reputation

63
Q

What is product differentiation

A

An attempt by a business to distinguish its products from those of competitors

64
Q

What is the point of product differentiation

A

It can help you gain a competitive advantage
Unique selling point

65
Q

What is the definition of adding 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

66
Q

What are ways to add value?

A

Marketing and branding
Product differentiation
Options for customisation
Convenience of the product e.g. how easy is it to order
Design
Functions and features

BM Business theme 1 (4 decks)

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