Lesson 3 Recognize and Understand the Market

Question 1

A business or marketing statement that summarizes why a consumer should buy a company’s product or use its service.

Answer 1

Value Proposition

Question 2

This statement is often used to convince a customer to purchase a particular product or service to add a form of value to their lives.

Answer 2

Value Proposition

Question 3

In creating Value Proposition, entrepreneurs will consider the basic elements:

Answer 3

Target Customer
Needs/Opportunity
Name of the Product
Name of the Enterprise/Company

Question 4

Refers to how you sell your product or services to your customer. You will address the wants and desires of your customers.

Answer 4

Unique Selling Proposition

Question 5

How to create an effective unique selling proposition to the target customers are:

Answer 5

1. Identify and rank the uniqueness of the product or services character.
2. Be Very Specific
3. Keep It Short and Simple (KISS)

Question 6

Difference Between Value Proposition and Unique Selling Proposition in Terms of Definition, Focus, Scope, Purpose, and Example Use

Answer 6

Value Proposition:
1. A statement describing the unique value a product or service provides to customers and how it solves their problems or meets their needs.
2. Customer-Focused: Emphasizes the benefits and solutions offered to customers.
3. Broader: Encompasses the overall value delivered by the business.
4. To convey why customers should choose the business based on value and benefits.
5. Used in marketing to articulate the overall promise to the customer.

Unique Selling Proposition
1. A Statement that highlights what makes a product or service stand out from its competitors.
2. Competitor-Focused: Highlights differentiation and uniqueness compared to competitors.
3. Narrower: Focuses specifically on the key point of differentiation.
4. To distinguish the business in the market based on uniqueness.
5. Used to attract attention by highlighting a specific unique feature.

Question 7

Three Factors That Will Determine Your Customers

Answer 7

1. Target Market
2. Customer Requirements
3. Market Size

Question 8

A sage in market identification process that aims to determine the buyers with common needs and characteristics.

Answer 8

Market Targeting

Question 9

A market segment that an entrepreneurial venture intends to serve.

Answer 9

Prospect Customers

Question 10

Common Methods for Segmenting the Market

Answer 10

1. Geographic Segmentation
2. Demographic Segmentation
3. Psychological Segmentation
4. Behavioral Segmentation

Question 11

The total market is divided according to geographical location.

Answer 11

Geographic Segmentation

Question 12

Variables to Consider in Geographic Segmentation

Answer 12

a. Climate
b. Dominant Ethnic Group
c. Culture
d. Density (Rural or Urban)

Question 13

Divided based on consumers.

Answer 13

Demographic Segmentation

Question 14

Variables to Consider in Demographic Segmentation

Answer 14

a. Gender
b. Age
c. Income
d. Occupation
e. Education
f. Religion
g. Ethnic Group
h. Family Size

Question 15

Divided in terms of how customers think and believe.

Answer 15

Psychological Segmentation

Question 16

Variables to Consider in Psychological Segmentation

Answer 16

a. Needs and Wants
b. Attitudes
c. Social Class
d. Personality Traits
e. Knowledge and Awareness
f. Brand Concept
g. Lifestyle

Question 17

Divided according to customer’s behavior pattern as they interact with a company.

Answer 17

Behavioral Segmentation

Question 18

Variables to Consider in Behavioral Segmentation

Answer 18

a. Perceptions
b. Knowledge
c. Reaction
d. Benefits
e. Loyalty
f. Responses

Question 19

The specific characteristics that the customers need from a product or a service.

Answer 19

Customer Requirements

Question 20

Two Types of Customer Requirements

Answer 20

1. Service Requirement
2. Output Requirement

Question 21

An intangible thing or product that cannot be touched but the customer can feel the fulfillment.

Answer 21

Service Requirement

Question 22

It includes all aspects of how a customer expects to be treated while purchasing a product and how easy the buying process goes.

Answer 22

Service Requirement

Question 23

Tangible thing or things that can be seen. Characteristic specifications that a consumer expects to be fulfilled in the product.

Answer 23

Output Requirement

Question 24

Refers to the size of the business arena, indicating the approximate number of sellers and buyers in a specific market.

Answer 24

Market Size

Question 25

Steps to Determine the Market Size

Answer 25

1. Estimate the potential market: Identify the approximate number of customers likely to buy the product or service.
2. Exclude disinterested customers: Estimate the portion of the market unlikely to buy the product or service.
3. Estimate market share: Analyze competitors’ market share to identify the new venture’s potential share.