1.1 meeting customer needs Flashcards
What is a market?
Where sellers and buyers meet and trade goods.
what is a mass market?
Mass market is where a business will target a large population of the market with same product or services.
What is the aims of marketing?
Is to help and identify, anticipate and satisfy consumer needs and want to make a profit.
what is market research?
Is the process of gathering data from consumers, which can be used to influence business decisions.
Why is market research important?
it is important to help business to identify products and services to develop a response to the consumers needs and want.
What is a business Risk?
Is a potential threat to a business success. Risk is external or internal. And it can be prepared for and calculated.
What is an uncertainty?
What is uncertainty?
are the outcomes which are difficult to predict.
What is the characteristic of a mass market?
- Target a larger population of the market with same product/services.
- Productions are large scale.
- High sales revenue (potential).
- compete with many business in the market.
- Business will be competitive on pricing to succeed.
what is a market segment?
market segment are groups of consumers who share similar characteristics e.g lifestyle, age etc.
In mass market, where are the products aimed at?
they are aimed at a broad market segment.
what is a niche market.
Niche market where the market is the product/services are targeted in a smaller market in the whole market.
when does niche market happen ?
it happens when business identify and satisfy a smaller group of consumer within the wider market.
what is the characteristics of a niche market?
- productions happen on small scale.
- products are more specialised.
- Higher average cost because of small scale production.
- High prices makes products less affordable and lower sales volume.
- higher prices allows business to have higher profit margins.
what is sales volume?
is the number of products sold.
what is the formula for sales revenue?
Sales revenue = price x quantity sold.
what is the market share?
is the percentage of the market a business controls.
formula for market share?
Market share = sales of a business divided by total sales in the market X 100
what is a brand ?
is a name,image,logo which helps one’s products/services stand out from other competitors.
what is products differentiation?
products differentiation is a process where differentiate one’s product/services from competitors product in the market.
what is adding value?
is a process where a business will increase the prices that the consumers are willing to pay.
How do business stand out from its competitors in the mass market?
Businesses will use branding to stand out from the competitors.
what is a dynamic market?
dynamic market is a market that experience rapid or continuous changes.
What is online retailing.
It involves selling products via the internet.
What is the advantages of online retailing?
- More business access to customers. including internationally.
- longer trading hours as business is open 24/7.
- lower fixed and variable costs.
- consumers can shop at anytime.
what is the disadvantage of online retailing?
- high cost for web development and maintenance cost.
- high level of competition.
- lack of personal contact with consumers.
- consumers find difficult to return unwanted products.
what types of changes in the market?
- changes in consumers taste and preferences.
- changing demographics.
- volume of competition.
what is product innovation?
is the adaptation or improvement of existing products.
what is market growth?
is the increase in sales volume of products/services and economy activity over time.
how does competition happen in business?
when two businesses are providing products/services to the same target market.
what is direct competition?
is where business is targeting customers with the same product as a competitor
what is indirect competition?
is when businesses sell different products/services but compete with each other for the customers disposable income.
Benefits for consumers in a competition of businesses?
-Businesses offer lower prices.
-Businesses produce better
quality products.
-Businesses provide better customer service.
what is a product orientation?
product orientation is to focuses on the characteristics of the product rather than the needs of the consumer.
what is market orientation?
Market orientation is to focuses on the needs of consumers and uses this information to design products that meet customer needs.
what is market research?
Market research is the objective collection, compilation and analysis of information about a market.
what is primary research?
Primary research is the process of gathering information directly from consumers in the target market using field research methods such as surveys, interviews, etc.
- This gathers information that is new and does not necessarily exist in any format.
what is the advantages of primary market research?
- focused on the needs of the business
- The business can get in-depth information from respondents,.
- more up-to-date and can be used to ask specific questions, so will be more relevant
Disadvantages of primary market research?
- The sample size may be too small.
- Bias may mean that researchers can guide respondents to answer questions in a particular way.
- A business may need to hire a specialist market research agency and this is expensive.
what secondary market research?
Secondary research involves the collection, compilation, and analysis of data that already exists.
- Typical methods include purchasing market reports from specialist companies or accessing government statistical portals.
Advantages of secondary market research?
- Information is already available and so is quicker to collect.
- Information is often free (e.g. government websites and internet sources .
Disadvantages of secondary market research?
- may lack relevance or may not be factually correct.
- Can be expensive to purchase market specific secondary data from specialist.
- Information may be out-of-date.
what is Market segmentation?
Market segmentation is in which a single market is divided into submarkets, or ‘segments’.
Advantages of market segmentation?
- Recognises that consumers are not all identical.
- meet different needs of different groups of consumers and targeted more precisely.
- increase loyalty if the consumer feels that their needs are being met, which can lead to repeat purchases.
- Less expensive and wasteful.
Disadvantages of Market Segmentation?
- difficult to identify a segment and consumers can belong to multiple segments.
- more detailed market research, which can prove costly.
- too small and unprofitable.
what is Market positioning?
Market positioning refers to the process a business goes through when launching a new product or service.
- The business decides where they want to position the product in the market with regard to price, quality, branding, and customer perception.
what is market mapping?
Market mapping is a tool for identifying the position of a product within a market.
-A market map refers to 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. price and quality, age and income, etc.
usefulness of market mapping?
- Market gaps can be identified which may enable a business to come up with ideas for new products.
- Comparisons can be made between a business’ products and those of its rivals.
- Market maps are simple to construct and offer a visual illustration.
limitation of market mapping?
- Mapping a market may require primary research which can be expensive.
-Only two criteria can be chosen which may prove too simplistic.
- Markets are often dynamic and a market map only provides insight at a specific point in time.
- A gap in the market may exist because it is not profitable.
what is competitive advantages?
Competitive advantage is the features of a business and its products that are perceived as superior to its rivals by customers.
- It is how a firm’s product is made both distinctive and defensible.
- Distinctive means that it is different from the competitors.
- Defensible means that the business can prevent competitors from copying it
what are some of the ways a business gets competitive advantages?
Adding value and differentiation.
What is adding value?
Adding value is the difference between the price that is charged to the customer and the cost of inputs required to create the product or service.
What are the method of adding value?
- Marketing and branding.
- Functions and features.
- Customer service.
- Customisation.
- Packaging.
