1.1.1 The Market

Question 1

What is a Mass Market

Answer 1

• where a business sells into the largest part of the market

- where there are many similar products on offer

Question 2

What is a niche market

Answer 2

• where a business targets a smaller segment of a larger market
• where customers have specific needs and wants

Question 3

Mass markets characteristics

Answer 3

• customers form majority of market
• needs and wants more general
• higher output and capacity
• low cost, wide distribution

Question 4

Niche market characteristics

Answer 4

• loyal customers
• higher profit margins
• lack economies of scale
• can attract competition if successful

Question 5

What is market size

Answer 5

• the total volume of a market

- in terms of no.of sales or value of sales

Question 6

What is market share

Answer 6

• the percentage/segment of a market which a business controls

Question 7

What is a dynamic market

Answer 7

• a market which is constantly changing

Question 8

Four key factors to consider in dynamic markets

Answer 8

• online retailing
• how markets change
• innovation and market growth
• adapting to change

Question 9

How does online retailing impact a dynamic market

Answer 9

• development of technology
• increase in online retailers
• can cause store based retailers to lose market share
• online market shares predicted to increase

Question 10

How does competition affect dynamic markets

Answer 10

• can reduce market share of other companies
• can stimulate innovation
• can prevent monopolies
• lower prices