1.1.3 Market positioning

Question 1

What is market mapping

Answer 1

Laid out as a matrix with two measure(e.g. price and quality)
Products can then be positioned on the matrix according to where they are judged to lie between the two extremities

Question 2

Uses of market mapping

Answer 2

• reveals gaps in the market
• can show who is a businesses closest competition
• help a business establish a pricing strategy

Question 3

Explain the ways in which a business has a competitive advantage

Answer 3

• lower costs, should generate more sales
• product innovation, new unique products that are the first in the market increases sales
• advertising and marketing, strong brand image makes products more attractive
• product differentiation, USP’s make a product completely different from the others in the market
• reliability and quality, this builds brand loyalty may allow a business to charge higher prices
• customer service, polite efficient and knowledgable staff can lead to repeat purchases
• convenience, quick easy service is more appealing

Question 4

List the ways in which a business can gain a competitive advantage

Answer 4

Lower costs
Innovation
Marketing
Differentiation
Reliability
Customer service
Convenience

Question 5

how to calculate added value

Answer 5

Price the product is sold for - cost of making the product

Question 6

What is added value

Answer 6

• a competitive advantage allows the business to increases prices
• added value can also be achieved by reducing costs

Question 7

how can value be added

Answer 7

through production, distribution or markteing
1. production- improve product design or quality
2. distribution- making the product/service easily accessible and convenient
3. marketing- creating a brand image