1.1 meeting customer needs (booklet 1) Flashcards
Marketing
range of activities a business uses to help sell its products and services
A market
a place where buyers and sellers exchange goods and services
Mass marketing
businesses target a large segment to sell to as many people as possible
Niche marketing
businesses target a small segment of a larger market, where customers have specific needs and wants
4 characteristics of a niche market
- targets a smaller segment of the market
- customers have specific needs and wants, easier to focus on customers needs
- little competition, higher prices
- larger businesses may be attracted is there is a high profit potential, therefore then unable to compete as prices will be lowered
3 characteristics of a mass market
- customers’ needs and wants are more generic and less specific
- very large scale, can mass produce, high revenues
- a lot of competition, lots of money therefore spent on marketing, e.g advertising, offering different types of service
Market size
total sales of all businesses in a market.
- unit x selling price
- revenues / market share
Market share
percentage of total sales
- sales for one business/ total market sales x 100=%
Market growth formula
difference/total x 100
Why are brands important?
to differentiate products, usp, can then charge premium prices
Mass market
Very large market where they target a large segment of the market
Niche market
a smaller segment of a larger market which targets specific needs and wants of customers
Dynamic market
A market which is continuously changing
type of dynamic market
online retailing as it continues to change and develop
examples of dynamic market
- film industry- disrupted by online streaming e.g netflix
- taxi services- disrupted by apps e.g UBER
- camera market- disrupted by phones, e.g iPhones
3 key sources of change in dynamic markets
- advances in technology, innovation
- changing customer tastes and preferences
- changes in legislation, smoking ban
how can businesses adapt to change
- more flexible, e.g 24 hour gym and supermarkets
- carry out market research so they’re aware of changing customer preferences
- Invest in new product development and training for workers to provide skill, to boost sales
- develop a niche
effect of competition on consumers
advantage, a lot of choice between products as businesses selling similar products
effect of competition on businesses
lower profits as prices reduced or increased, need to improve quality and customer services. or if a business is successful in competition market share rises and profits are higher.
risk
possibility things will go wrong, can be calculated and measured
uncertainty
unpredictable and uncontrollable external events, cannot be measured or calculated
