customers

Question 1

why do market-led businesses carry out market research?

Answer 1

• to determine the kinds of products that a consumer wants
• to identify those consumers most likely to purchase its existing or planned products

Question 2

what are the advantages of a market-led strategy?

Answer 2

• responsive to the needs of its target audience, which can boost brand identification, loyalty and trust
• responsive to changing customer preferences and trends in the market

Question 3

what are the disadvantages of a market-led strategy?

Answer 3

relies heavily on market research which can be costly and time consuming

Question 4

what do product-led bsuinesses focus on?

Answer 4

making all customers aware of their products, rather than targeting any particular customer or segment of the market

Question 5

why do product-led businesses concentrate on researching and developing their product?

Answer 5

• to produce it at the lowest unit cost
• to make it better or more appealing to customers than those of its competitors

Question 6

what are the advantages of a product-led strategy?

Answer 6

• the business is always looking to refine and improve its products to make them the best on the market, so the consumer benefits from better, safer products
• the quality of the product made by a production-oriented company may be superior to that of a marketing-oriented company

Question 7

what are the disadvantages of a product-led strategy?

Answer 7

• little or no market research is carried out before production begins.
• a competing business may produce a better cheaper product that will be difficult to compete with.
• not responsive to changes in consumer tastes or market trends

Question 8

why do businesses look at consumer behaviour?

Answer 8

so they can better understand:
- the decision behind why customers purchase certain products
- what influences them to make those purchasing decisions

Question 9

why might businesses carry out research into consumer behaviour?

Answer 9

to find out:
- how consumers behave individually and in groups.
- why consumer behaviour patterns change based on the types of products and services they purchase.
- when consumers are most likely to make a purchase.
- how a customer feels directly before and after buying a product.
- which questions or objections contribute to the buying decisions.

Question 10

what are the three different types of consumer behaviour?

Answer 10

• routine/habitual purchases
• informed purchases
• impulsive purchases

Question 11

what are features of routine/habitual purchases?

Answer 11

• require little involvement by the customer
• often made automatically, eg, fuel, hair products
• certain marketing strategies can influence routine purchases, such as money off vouchers or BOGOF
• however, because many customers have brand loyalty to particular products, sales promotions such as these may have a limited impact

Question 12

what are informed purchases?

Answer 12

• when the buyer takes time to investigate the product
• they will consider different products that are on offer and the specifics of the product they are interested in
• this behaviour is usually used when a customer is buying expensive long-term goods such as a car

Question 13

what are impulse purchases?

Answer 13

• happen without any prior planning or thought
• impulse purchasing often happens because a product has caught a customer’s eye, such as a bar of chocolate placed at the checkout
• effective point of sale displays can influence impulse purchasing