1.2 Spotting a business opportunity Flashcards
Customer service
The actions of a business that aim to meet the customers needs a fully as possible
Positive customer engagement
When customers have a good experience of interacting with a business, its products and services
Closing
Finalising a sale, getting the customer to agree to buy
Post-sales service
After-sales help, advice and support for the customer
Benefits of good customer service
Defines the brand image, increases competitiveness, encourages repeat business
Customer expectations
What the pre-existing knowledge and experience the customer has about the business and its products
Risks of bad customer service
Loss of sales, market share, increased costs and poor reputation
Premises
The building or physical space where a business operates, shops, factories and offices
Word-of-mouth
Customers talking about their experience of service and influencing others
Product knowledge
Staff knowing the features and benefits of the product or service being sold
Data analysis
Collecting and understanding information about the business operations so informed decisions can be made
Customer feedback
Asking the customers about their experience of the product and the interaction with the business
Customer loyalty
When customers return to buy products and services from the same business
Point-of-sale
The place and time that a transaction is made between the customer and the business
Customer satisfaction
How far the needs and expectations of customers are being met
Market research
Methods that a business uses to find out about the viability of a new product, attitudes and opinions towards existing products and how to better satisfy the needs and wants of the customer
Purposes of market research
Identify customers and their needs, find gaps in the market, reduce risk and make better business decisions
Quantitative research
Finding out statistics, percentages and data
Qualitative research
Finding out opinion, experience and attitudes
Primary research
Getting first-hand information from customers sometimes called ‘fieldwork’
Secondary research
Using existing sources of data sometimes called ‘desk research’
Online survey
Computer-based questions, collected and collated automatically
Questionnaire
Usually sets of written or verbal questions to customers
Focus group
A small group that is asked about their opinions, habits and choices
Observation
Watching the behaviour of customers and consumers
Internet research
Using the web to do market research, this can be both quantitative and qualitative
Sales volume
The number of products sold
Sales value
The amount of revenue received from products sold
Market share
The percentage of the market that an individual business or product commands in comparison to its direct competitors
Demand
The need to buy or consume goods and services
Competition
Other businesses who are trying to sell their products in the target market
What is a segment?
A piece of the whole usually expressed as a percentage or fraction.
What is market segmentation?
Dividing the market up into groups of customers and consumers with specific needs and wants.
What is mass marketing?
Marketing a product to the whole, unsegmented market, regardless of individual group or demographic differences.
What does location refer to in marketing?
Where people live, work and interact with the market.
What does income refer to in marketing?
How much money customers earn.
What is lifestyle in the context of marketing?
The choices people make in the way they live, e.g. hedonistic, vegetarian, health-conscious.
What does age refer to in demographics?
The different age groups that make up the population, usually divided into bands or life stages, e.g. over 65s or retired people.
What are other demographic factors?
Factors that define people into groups, e.g. race, religion, gender.
What is demographics?
The study of statistical differences within a given population.
What is market mapping?
Setting out the features of a market in the form of a diagram.
What does targeting mean in marketing?
Aiming your product or service at a specific group or set of groups in the market.
What does competing effectively mean?
Gaining market share and driving inefficient products and businesses out of the market.
The Market
The place where the laws of supply and demand operate and buyers and sellers interact
Competition
Other businesses that offer potential customers similar products or services that meet their needs and wants
Monopoly
When a business has no competitors
Market share
The percentage of the goods and services in a particular market provided by an individual business
Competition by price
The strategy of lowering the price of goods and services to increase sales
Competition by product development
The strategy of improving or developing products to increase sales
Competition by advertising or marketing
The strategy of using communications to increase demand for a product
Uncertainty
A future outcome that cannot be predicted or managed
Risk
A future outcome that can be predicted and managed
Internal risks
Risk that arises from the business, its staff and operations
External risks
Risk that arises from outside the business
Minimizing risk
The identification, prediction and management of potential risks
Diversification
Having a range of products or operating in a range of markets to avoid over-reliance on a single product or market
Recession
A fall in GDP in two successive quarters
Depression
An extreme recession that lasts 3 or more years and results in a fall of over 10% GDP
