1.2 Spotting a Business Opportunity Flashcards
What is a stakeholder?
Someone who has an interest in the business. Internal stakeholders are inside the organisations e.g. manager and employee, whereas external stakeholders are outside the business e.g. customers and suppliers.
What are the four key customer needs?
The four key customer needs are: Price, quality, choice and convenience.
What is meant by ‘convenience’?
Convenience refers to how easy it is for a customer to obtain or use a product or service. Convenience usually refers to the following factors:
- Location
- Availability
- Payment options
- Delivery
What is market research?
The process of gathering information about the market and customers needs and wants in order to help inform business decisions, including product design and marketing.
What is the purpose of market research?
The purpose of market research is to:
- Identify and understand customer needs
- Identify gaps in the market
- Reduce risk
- Inform business decisions
What is the difference between primary research and secondary research?
Primary research is direct, carried out by the business, and thus is reliable; it is, however, time consuming. Whereas secondary research is indirect and carried out by a third party; it is therefore not as reliable, but it is less time consuming.
State the different types of primary market research.
Primary research includes: Surveys, questionnaires, focus groups and observation (although direct, can be time consuming as the data needs to be collected and then analysed before judgement can be made).
State the different types of secondary market research.
Secondary research includes: Internet, market reports, government reports (indirect, and although less reliable, is time saving as someone has done the data collection for the business).
What is the purpose of a focus group (primary research)?
A focus group is a target group of people that are taken to discuss a concept or idea. This is qualitative research and thus not easily measured.
What is meant by the term ‘Market Segmentation’?
Market segmentation is about splitting the potential market for a product or service into different groups, so that they can be targeted in a specific way.
Give examples of the different market segments.
Demographics are often used to split the market into segments, e.g. by age, by gender, by ethnicity, by income etc.
What is a target market?
A target market is a particular group of consumers that a product or service is aimed at.
What is ‘Market Mapping’?
Market mapping is a business tool used to identify gaps in a market.
How is a market mapped?
Two key features are used to compare the products or brands in a particular market - price and quality is commonly used.
What is a ‘brand’?
A product manufactured by a particular company under a particular name.
