Market Positioning Flashcards
What is market mapping?
It’s the process of finding the variables which differentiates the brands in the market and plotting them on a map to identify the gap in the market.
Give examples of the variables on a market map.
Modern, Mass, Functional, High quality, Luxury and Premium
What are the uses of market mapping?
1) It can be used to identify a gap in the market.
2) It can also be used as a start-up to identify which products to produce so they are market orientated.
What is competitive advantage?
An advantage that the business has over its competitors allowing it to generate larger than average turnover for the industry
What are the 10 ways a business can achieve competitive advantage?
Price, Added value, Innovation, Reliability, Quality, Reputation, Advertising, Branding, Convenience, Customer service
What is product differentiation?
When a product is different from competition in some way. Consumers must be able to perceive this difference and be willing to pay a premium price for the product.
What is added value?
The difference between the price that is charged to the customer and the cost of inputs required to create the product or service. This can be achieved through the product itself or the way consumers view it.
How can a business add value?
1) Design - To develop new technology/design features to make the product unique.
2) Production - Where achieving quality and efficiency adds value. The quality charges a higher price on the product whilst efficiency helps cut costs of the input.
3) Marketing - Creating an image that makes the product more desirable.
What are the benefits of adding value?
1) The more value is added the higher the price can be charged, which means higher profit margins.
2) Protection against competitors offering lower prices which means competitive advantage.
3) Customer loyalty.
