Identifying And Understanding Customers Flashcards
Marketing
Generating an interest in a product or service
To sell a product….
….a business needs to understand the wants and needs of individual customers
A need
Something which has to be fufilled for a person to survive
A want
What we would like to satisfy our needs. Perhaps something more specific: we need to eat but might want a red velvet cupcake.
Process of marketing
(In order) Identifying customer needs, market research, product development, pricing, promotion, place (where/how it is sold)
Development, pricing, promotion and place are known as the ‘marketing mix’
Exchange process
When someone gives up something in return for something else. E.g. a business will usually exchange a product for money. Businesses need the reward gained by an exchange to be worthwhile and better than what could’ve been gained (opportunity cost). Customers want to feel that the benefits justify the price paid.
How can a business increase sales?
By providing more benefits and doing something better than competitiors, a business’ sales should rise
Identifying a business opportunity
To sell products and/or services, a business must identify and offer something that customers value and are willing to pay for.
A business needs something it does better than others or fix something that people aren’t happy with.
If a business doesn’t understand it’s customers:
-it may need to withdraw a product due to sales being too low
-it may need to amend the product which’ll cost money
-it may need to lower the price, reducing profits
-it’s brand image is damaged, affecting the business’ future success
Benefits to a business understanding it’s customers
-it knows their wants and can appeal to them
-it’ll make more sales and is less likely to waste time and money on withdrawing, fixing, lowering the price of products and damaging brand image
Marketing mix
The combination of factors that influence a customer’s decision to purchase a product.
Customers can be attracted by…..
Price: customers are more likely to buy a product with a price proportionate to it’s quality.
Quality: the standard of the product of service being offered
