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Marketing Flashcards

1
Q

What is a market?

A

Groups of individuals and organisations that make up the pool of actual and potential customers

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2
Q

What does a dynamic market mean?

A

A market which is constantly changing, must be aware of market trends

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3
Q

What does market size mean?

A

The total value of a market in terms of money spent or number of products

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4
Q

What does market growth mean?

A

The % change in the size of a market compared to the previous year

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5
Q

What does market share mean?

A

The % of the market held by one company or product

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6
Q

What is a mass market?

A

A market that is aimed at the general population

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7
Q

What are the advantages of a mass market?

A

-Larger market means more customers and sales available
-Can target anyone
-A more recongnised brand
-Larger capital available for manufactuing

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8
Q

What are the disadvantages of a mass market?

A

-More competitive
-Not appealing to everyone
-High marketing costs
-Holding a high volume of products isn’t easy to change when demand changes

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9
Q

What is a niche market?

A

A subset of the main market and addresses a specialist need

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10
Q

What are the advantages of a niche market?

A

-People are willing to pay a higher price
-Less competition
-Easier to target customers
-Smaller scale of production means it is easier and more flexible to follow trends

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11
Q

What are the disadvantages of a niche market?

A

-Risky as there is not constant demand
-Higher unit costs because there are no economies of scale

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12
Q

Why do markets change?

A

-Supply
-Demand
-Economic growth
-Changes in fashion/taste
-Changes in technology

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13
Q

How do firms compete?

A

-Price
-Product range
-Customer service

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14
Q

What is offensive marketing?

A

When a business tries to increase sales or develop new markets
How:
-break into new markets
-invest in innovation
-acquire other businesses
-move into other related businesses

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15
Q

What is defensive marketing?

A

When a business reacts to competition and tries to maintain their market share
How:
-cost cutting
-rationalisation of products by cutting unsuccessful products

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16
Q

What is innovation?

A

The development of products, changing established products and using new materials
-includes changing/developing an existing product

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17
Q

What are the advantages of innovation?

A

-Possibility of new sales
-Access to new customers
-Possible growth in market share
-Brings attention to the brand

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18
Q

What are the disadvantages of innovation?

A

-Risky as its more likely to fail
-Expensive
-Disrupting the way the business operates

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19
Q

What is online retailing?

A

Involves selling products/services online
-it is removing the physical interaction and using technology based interactions

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20
Q

Examples of online retailing

A

-Amazon = 1994
-Ebay = 1995
-Etsy = 2005

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21
Q

What are the advantages of online retailing?

A

-Open 24/7
-Can easily reach international customers
-No premises (no rent)
-Can easily update/withdraw stock to keep up with market changes

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22
Q

What are the disadvantages of online retailing?

A

-Higher number of returns
-Issues with online security (fraud, scams)
-Very competitive market as competitors can be aware of other businesses prices and strategies
-Owners require IT skills

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23
Q

What are the risks of owning a business?

A

-Failure = expensive debts
-Bad reputation
-Not breaking even (no profit is ever made)

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24
Q

What are the rewards of owning a business?

A

-Lots of profit
-Using your own knowledge/skills
-Own boss/managing your own time

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25
Q

What are calculated risks?

A

One that has been carefully considered and for which the costs and benefits have been weighed up

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26
Q

What is a business plan?

A

A formal statement of what the business is planning to do which assess the risk of their new ideas

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27
Q

What is market orientation?

A

The decisions of a business are based around information about customer needs and wants
-the customers needs are their main focus
-success depends on customer satisfaction
-customers should be more accepting of the product as it meets their needs

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28
Q

What is product orientation?

A

When a business develops products based on what it is good at marking/doing rather than what the customer wants
-innovation is the main focus
-must educate customers on the benefits of the product
-creates unique products

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29
Q

What is market research?

A

Involves collecting, analysing and interpreting information about a target market, customers competitors and the industry as a whole
-used to gain a detailed understanding of consumer needs
-reduce the risk of product/business failure

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30
Q

What is quantitative data?

A

Based on data/statistics
-includes closed research questions such as ‘when’
-uses larger samples and is therefore more statistically valid

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31
Q

What is qualitative data?

A

Based on opinions, attitudes, beliefs and intentions
-includes open questions such as ‘why’
-aims to understand why customers behave in certain ways

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32
Q

What is big data?

A

It is data generated in large quantities and is fast information
-the process of collecting and analysing large data sets from sources to identify trends which can be used in decision making

33
Q

Examples of big data

A

-Snapchat = 2.1
million generated her minute
-Email = 138 million generated per minute

34
Q

What are the limitations of big data?

A

-Unstructured so it is hard to analyse therefore making it costly to analyse
-Most of the data is recent so it is hard to analyse past trends
-Consumers can be concerned about privacy which may restrict how much data can be collected
-Loss and theft of data can damage businesses

35
Q

What is sampling?

A

Involves choosing the right number of people to get a representative group of customers

36
Q

Types of sampling

A

-Quota sampling = more specific about who you sample
-Convenience sampling = sampling people convenient to you and the business

37
Q

What are the problems with sampling?

A

-Must have a careful selection to ensure results are representative
-Sample size must be accurate/appropriate to get accurate results
-Can be biased resulting in inaccurate results
-Human error

38
Q

What is friendly bias?

A

People tending to agree and be positive about the ideas presented in the research

39
Q

What is social desirability bias?

A

People answering questions in a way that you think is socially acceptable

40
Q

What is confirmation bias?

A

When the researcher interprets results to confirm the belief by filtering out negative information

41
Q

What are leading questions?

A

When the researcher suggests the answer that the survey is looking for

42
Q

What is market segmentation?

A

A group of customers that have similar characteristics (stereotyping)

43
Q

How can markets be segmented?

A

-Age
-Gender
-Income/social class
-Location/geographical

44
Q

Why do you need to market segment?

A

-Benefits customers want
-Amount customers are willing to pay
-Media they use (where will they see the adverts)

45
Q

What is geographical segmentation?

A

-Customer location
-Region
-Urban /rural

46
Q

What is demographic segmentation?

A

-Age
-Gender
-Socio-economic group

47
Q

What is behavioural segmentation?

A

-Rate of usage
-Benefits (impulse buys, seasonal items)
-Readiness to purchase

48
Q

What psychographic segmentation?

A

-Personality
-Lifestyles
-Class

49
Q

What are the benefits of doing market segmentation?

A

-Customer loyalty
-Customer retention
-Positive word of mouth

50
Q

What are the limitations of market segmentation?

A

-Increased costs due to shorter production runs
-Promotional and distribution expenditures increase due to different programmes used for different market segmentation

51
Q

What is a market map/market positioning?

A

A grid that measures two different aspects of the brands or businesses within a market
-used to identify the marketing strategies of competitors in the market

52
Q

What is the purpose of a market map?

A

-Identify a gap in the market
-Show how a market is segmented
-Show where a sector is overcrowded

53
Q

What are the advantages of market mapping?

A

-Helps spot gaps in the market
-Allows firms to analyse new competitors
-Suggest ways to create brand images and marketing techniques

54
Q

What are the disadvantages of market mapping?

A

-Time consuming
-Opinionated and judgemental (no right answer)
-Requires market research

55
Q

What is added value?

A

An increase in value that a business creates by undertaking the production process

56
Q

How can firms add value?

A

-Build a brand (reputation of high quality)
-Delivering excellent service
-Add features or benefits to a product

57
Q

What are the benefits of added value?

A

-Charging a higher price
-Creating a difference from competitors
-Focusing more closely on target market segments

58
Q

What is product differentiation?

A

Where a product is different from the competitors in some way

59
Q

What is competitive advantage?

A

Ways that businesses makes its product/services appear superior to the competitor

60
Q

How do you have cost advantage?

A

-Generate economies of scale by buying in bulk
-Operate efficiently to be cheaper than competitors

61
Q

How do you have barriers to entry?

A

Making it difficult for other businesses to get into the market

62
Q

What is primary research?

A

New research carried out to answer specific issues/questions

63
Q

What are the pros and cons of primary research?

A

Pros:
-reliable source
-specifically designed to meet the objectives of a project
Cons:
-Time consuming
-Expensive

64
Q

What are questionnaires?

A

A survey of customers using the business which measures customer satisfaction

65
Q

What are interviews?

A

A more detailed survey to gauge reactions to new ideas the business is having

66
Q

What are observations?

A

Observing buyer behaviour without buyers being aware

67
Q

What are loyalty cards?

A

Keeping track of how much customers buy, what they buy and how much they’re spending for more cost effective marketing

68
Q

What is a focus group?

A

A group of a target market takes part in a trial by using the product and discussing their thoughts

69
Q

What is test marketing?

A

Putting samples of products in stores to get feedback before launching the product

70
Q

What is secondary research?

A

Information that already exists, produced by someone else for something else and is made publicly available

71
Q

What are the pros and cons of secondary research?

A

Pros:
-Less expensive
-Faster
Cons:
-Already exists (out of date)
-Not always related to the needs of a specific project

72
Q

What are annual reports?

A

They are produced by a business with all of the businesses information

73
Q

What is internal data?

A

Data from within the business using sales figures and a database of loyal customers

74
Q

What are government sources?

A

A census every 10 years analysed by the office of national statistics

75
Q

What are trade journals?

A

Magazines and websites focusing on one specialist market or industry

76
Q

What are market research companies?

A

Mintel trends and reports which shows global trade analysis assessing change in culture, society and the economy

77
Q

What is brand extension?

A

Using an established brand name to launch a new product variant, this enables the brand to reach a wider group of customers

78
Q

What are the risks of developing a new product?

A

-Not meeting customer needs/wants
-Losing competitive advantage
-Not making the market share

Business (12 decks)

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