5.1 Identifying And Understanding Customers Flashcards
What is an exchange?
An exchange is when someone gives up something in return for something else, e.g. a business exchanges a product for money.
What is a need?
A need is something that needs to be fulfilled for us to survive.
What is a want?
A want is what we would like to satisfy our needs.
What is a customer?
A customer is someone who buys a product from a business
What is a consumer?
A consumer is someone who uses goods and services produced by businesses.
Give an example of how a business can increase its sales.
In the taxi market, Uber allows us to identify on our mobile phones the nearest taxi, to see the details of the car, to see the rating of the driver and to pay directly from our account. As a result, they ate providing a much better service, therefore their sales may increase.
Explain one way that a business understanding its customers effectively can lead to more sales.
If a business understands its customers effectively, the business can make its product suited to the requirements of a customer. For example, if customers are buying a fountain pen as a gift to others, a business can sell the pen as gift wrapped to appeal more to the customer.
What is sales volume?
Sales volume measures the number of items sold.
What is sales value?
Sales value measures the revenue generated.
What is segmentation?
Segmentation occurs when a market is divided into different groups of needs and wants.
Benefits of segmentation?
- a business can develop its products to fit customer needs more closely.
- a business can target its customers more precisely.
- a business can set the price appropriately.
What are ways of segmenting a market?
- by gender.
- by age.
- by location.
- by income.
What is targeting?
Once a business has identified relevant segments in its market, it will need to decide which ones to focus on.
What is market research?
Market research is the process of gathering, analysing and processing data relevant to marketing decisions.
