Edexcel- The Market 1.1 Flashcards

1
Q

Sales volume

A

Number of units sold

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2
Q

Sales value

A

Revenue generated from products

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3
Q

Market size

A

Sales over a period of time

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4
Q

Market share

A

Proportion of total market

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5
Q

Market share formula

A

Sales business/ total market shares x 100

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6
Q

Brand

A

Value and experience customer has with a product or service

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7
Q

Brand loyalty

A

Product or service which will get repeat business

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8
Q

Brand loyalty benefits

A

Customer loyalty
Business can charge higher prices
Retailers will want to stock brands

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9
Q

Mass markets pros

A

Large sales so high revenue
Economies of scale
Everyone can be equally targeted

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10
Q

Mass market cons

A

Lots of competition
Products need to be differentiated
Lower profit margins

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11
Q

Niche market pros

A

Charge premium prices
Easier to target consumers
Less competition

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12
Q

Niche market cons

A

Demand is not constant
No economies of scale
Difficult to target audiences as smaller

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13
Q

Dynamic markets

A

Markets which are constantly changing

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14
Q

Why do dynamic markets change

A

Online retailing
How markets change
Innovation and market growth

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15
Q

Innovation

A

Putting a new idea into action

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16
Q

Product innovation

A

Launching new products

17
Q

Process innovation

A

Finding better and efficient ways of producing existing products

18
Q

Benefits of product innovation

A

Added value
Build early customer loyalty
Enhanced reputation

19
Q

Benefits of process innovation

A

Reduced costs
Improved quality
Higher profits

20
Q

How competition affects market

A

Battle for market share
Pricing
Battle for competitive advantage

21
Q

Competitive advantage

A

Business has advantages over competitors

22
Q

Risk

A

Possibility things will go wrong

23
Q

Unpredictable

A

Uncontrollable events that affect business

24
Q

Online retailing

A

Selling products via the internet

25
Q

Advantages to online retailing

A

Provides businesses access to more consumers
Cheaper to run as lower fixed and variable costs
Consumers can shop at times that suit them

26
Q

Disadvantages to online retailing

A

High costs for website development, maintenance and promotion
More competitors
Difficult to provide good customer service

27
Q

How may markets change?

A

Changing consumer tastes and preferences
Changing demographics
Changing legislation

28
Q

Market growth

A

Measurement of change in entire market expressed as percentage of original size

29
Q

Adapting to change

A

Create flexible business structures
Meet customer needs
Invest in staff training

30
Q

Why competition positively affects competitiors?

A

Businesses offer lower prices
Businesses provide better quality products
Businesses provide better customer service

31
Q

How is the absence of competitors negative?

A

Reduce incentives for businesses to innovate
May have to offer higher prices to consumers

32
Q

Example of a risk

A

Currency fluctuations

33
Q

Example of an uncertainty

A

Interest rates