Business Choices P2 Flashcards
Benefit lost called
Opportunity cost
What is the benefit lost
Not training staff
Not investing in new system
Other business be more advanced
Motivation of workers
What are Benefit lost
Competition advanced
Motivation of workers decrease
Effficiency
IT system outdated poor communication
Opportunity cost
What you’re missing out on the next best alternative
Niche market advantage
Less competition
Charge high price
Niche market disadvantage
Smaller market so less sales
Building a brand
Time consuming and expensive
Benefit of branding
Increase demand
Reduce competition
Mass market
Largest part of the market where there are many similar prodicts on offer
Mass market advantage
Large customer base
High revenue
Strong brand awareness
Mass market disadvantage
High fixed capital cost
Lots of competition
Target market
Group of people that have been identified as the most likely potential customers
Market segmentation advantage
Increase market share target specific customers
Assist new product development
How can we use market segmentation?
Differentiate product meet customers needs
Special offers targeted at specific customers
Target advertising
Secondary data - method that involves using existing data sourced from other sources ADVANTAGES
Research been done for you
Takes less time
Quicker to evaluate
Secondary data DISADVANTAGE
Data may not exactly fit what ur looking for
Data not 100% reliable
Aims of market research
Identify + anticipate customer need and wants
Quantify (number) likely demand for a product
Provide insight into customer behaviour
How competition affects the market - business
Encourage customers to buy their products services
Lower prices
Unique sell point
High quality customer service
Product differentiation
Attempt by business to distinguish its product from those of competitors
Added value
Business provides extra features for the customer that go beyond their standard expectation
Competitive advantage
Unique feature of a company and its products
Market mapping ADVANTAGE
identify closest rivals + how much competition there is in the market
Identify gaps in market
Market mapping DISADVANTAGE
Based on opinions
Gaps in market may exist for reason
Oversimplified product
Market segmentation DISADVANTAGE
Not easy to categorise consumers
Cost of reaserch
Too much segmentation lead to lost sales
Dynamic market
Market subject to change
