Market research and segmentation Flashcards

1
Q

Define the term ‘market’

A

A place where buyers and sellers meet

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2
Q

Name the 4 types of market

A

Local, global, niche, mass

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3
Q

What are the two advantages of a local market?

A

1) Good relationship with customers

2) Easy travel and communication

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4
Q

What are the two disadvantages of a local market?

A

1) Customer are limited

2) Demand is smaller

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5
Q

What are the two advantages of a global market?

A

1) Variety of customers

2) More demand

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6
Q

What are the two disadvantages of a global market?

A

1) Slow spread of reputation

2) More competition

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7
Q

Define the term ‘niche market’

A

A specific product or service targeted at specific customers.

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8
Q

What is an advantage of niche markets?

A

Can charge at premium prices

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9
Q

Define the term ‘mass market’

A

Larger market having general advertisements

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10
Q

What is an advantage of mass markets?

A

More volume of sales

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11
Q

What is ‘market segmentation’?

A

Grouping customers based on similar interests and characteristics

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12
Q

What does demographic segmentation base off of?

A

Characteristics

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13
Q

What does psychographic segmentation base off of?

A

Hobbies and interests

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14
Q

What does geographic segmentation base off of?

A

Location: in regards to business or if they live rurally or urban.

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15
Q

What are the advantages of market segmentation?

A

1) Minimises unnecessary interaction with unworthy customers

2) Allows for more personal/effective market approaches

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16
Q

Define the term ‘targeting’

A

Process of deciding which segment should be focused on during advertisement

17
Q

What is market size?

A

Volume or value of sales in that market

18
Q

What is market share?

A

Proportion of sales compared to all sales in that market

19
Q

What is the formula for market share?

A

(Sale of 1 / Sale of all) x 100

20
Q

What influences market growth?

A

1) New or change in demand
2) More competition
3) The economy

21
Q

Define the term ‘extrapolation’

A

Extracting data from past graphs to predict the future

22
Q

What are the advantages of extrapolation?

A

1) Can prepare

2) Is easy to carry out

23
Q

What are the disadvantages of extrapolation?

A

1) Could be inaccurate

2) Ignores qualitative info

24
Q

Define the term ‘primary research’

A

First hand research carried out by the individual who needs it, so that it is specific to them

25
Give the 5 types of primary research
Observation, surveys, interviews, experiments, focal groups
26
What are the two advantages of primary research?
Specific and first hand
27
What are the two disadvantages of primary research?
Time consuming and expensive
28
Define the term 'secondary research'
Using existing info done by other sources, and adapting to your needs
29
Give 3 types of secondary research
Internet, libraries, government statistics
30
What are the two advantages of secondary research?
Cheap and pre-done
31
What are the two disadvantages of secondary research?
Not specific and is accessible to competitors
32
What is random sampling?
Each member has an equal chance of being chosen
33
What is quota sampling?
Use proportions for equal representation of all groups in population