1.1 Meeting Customer Needs

Question 1

What are the 2 types of market

Answer 1

Niche
Mass

Question 2

Market Definition

Answer 2

Where a buyer and seller can exchange money and products

Question 3

Market Orientated Product

Answer 3

Usually concentrating on market research, and what consumers need, not fully focusing on a product, but customising it to customer needs

Question 4

Product Orientation

Answer 4

Makers focus on the product and its production and the process of making it.

Question 5

Design Mix

Answer 5

Cost
Aesthetic
Function

Question 6

Mass Market Pros

Answer 6

-Large scale production mean more economies of scale and lower average unit costs
-Mass marketing straightforward as everyone is equally targeted
-Large volume of sales means high revenue
-High revenues can be pumped into R&D

Question 7

Mass Market Cons

Answer 7

-Lots of competition
-Homogeneous products need to be differentiated through marketing, can be expensive
-High volume of production not flexible to demand changes

Question 8

Niche Market Pros

Answer 8

-Charge premium price
-Easier to target customers
-Small scale production can be flexible and follow trends
-Less competition than in mass markets

Question 9

Niche Market Cons

Answer 9

-Very risky as demand may not be constant
-Higher unit costs so no economies of scale

Question 10

Market Share Formula

Answer 10

Sales of x/Total sales in whole market x100

Question 11

Online Retailing Pros

Answer 11

-Reach greater network of consumers
-More ways of advertising available
-24/7
-Take orders automatically
-Flexible
-Chance for fast growth

Question 12

Online Retailing Cons

Answer 12

-Train staff
-Technical issues
-Expensive set up costs
-Issues of sending goods back may put customers off
-Very competitive
-Owner need IT skills
-Cyber Security concerns

Question 13

Product Model

Answer 13

1. Core Benefit
2. Actual-Design, features, quality, brand
3. Augmented- Delivery and credit, after sale service, installation, warranty