Chapter 34: The Importance Of Marketing

Question 1

Market

Answer 1

Set of arrangement that allows buyers & sellers to communicate & trade goods & services

Question 2

Marketing

Answer 2

Process of identifying, anticipating & satisfying customer needs profitably

Question 3

Satisfying customer needs

Answer 3

Businesses must identify customer needs through effective market research in order to design & develop products which satisfy those needs to be able to sell & therefore become successful

Question 4

Anticipating customer needs

Answer 4

Businesses operate in competitive & rapidly changing environment, therefore they must anticipate needs in advance & keep up with latest trends, designs & technology

Question 5

Building customer relationships

Answer 5

Businesses establish bonds with their customers through effective communication & by doing everithing possible to meet their needs

Question 6

How to build relationships

Answer 6

• Connect regulalry
• Take complaints very seriously
• Say ‘thank you’
• Know your customer
• Personalise communication
• Build trust

Question 7

Importance of keeping customer loyalty

Answer 7

It is important for businesses to retain loyal customers so that they continue to purchase in the future

Question 8

How to build customer loyalty

Answer 8

Continue to satisfy customers needs, provide first- class service, design new products, communicate effectively & provide reliability
- Reward cards
- Charitable donations
- Free gifts
- Partnership deals

Question 9

Product orientated

Answer 9

Where a business focuses on the design & manufacture of the product itself rather than the needs of customers

Question 10

Market orientated

Answer 10

When the business focuses on the needs of customers when developing products

Question 11

Market share

Answer 11

Proportion of sales in a total market that a business or product enjoys

Question 12

Market analysis

Answer 12

Quanititative & qualitative assessment & finding out about the features & characteristics of a market

Question 13

Mass markets

Answer 13

Very large markets in which products with mass appeal are marketed

Question 14

Niche market

Answer 14

Smaller market, usually within a large market or industry

Question 15

Mass market features

Answer 15

• Sell & produce large quantities therefore able to exploit economies of scale —> higher sales & profits
• Lots of competition —> Much money spent on marketing

Question 16

Niche market features

Answer 16

• Usually less competition
• Easier to focus on customer needs as needs are specific

Question 17

Reasons for changes in market

Answer 17

• Changing customer needs
• Changing customer/consumer spending patterns
• Increased competition

Question 18

Changing customer needs

Answer 18

• Income changes
• Become more educated & sophisticated
• Influenced by changes in social habits
• Fashion & technology change over time

Question 19

Increased competition

Answer 19

Behaviour of competitors must be carefully monitored, as a new competitor could have a dramatic effect on sales if their products are more advanced or of better quality

Question 20

Importance to respond to changes in market

Answer 20

Methods cost businesses lots of money & reduces the amount of profit they make, however they must do so in order to survive in the market & reduce the risk of losing market share