Marketing Flashcards
What are the roles of Marketing
Identify customer needs: this will be done via ‘Market Research’. It will influence the development of a product, its price, and the sales technique.
Satisfy Customer Needs: selling the exact product customers want for a price they are willing to pay.
Maintaining customer loyalty: maintaining close customer relationships to discover the product’s expectations and changes needed to be made. It’s cheaper for businesses to keep existing customers than to attract new ones.
Building customer relationships to gain information about customers
Customer Relationships: communicating with customers to encourage them to become loyal to the business and its products.
Define Marketing
Identifying and satisfying customer needs and satisfying them profitably.
Why does consumer spending pattern change
Trends and Fashions Change: for some time, it might be fashionable to have a specific product
Advancement in Technology: new products provide the latest technology so older versions
Unemployment/Wages: Economies with high unemployment rates/low wages will not have increased sales of expensive products
Ageing Population: different ages are interested in other products
Why does Markets have become more competitive?
Globalisation: products are sold all over the world
Transportation: it is cheaper, quicker, and easier to send products around the world now
Internet/e-commerce: customers can now search for products or services and buy from somewhere else around the world
Define Niche Marketing
identifying and exploiting a small segment of a larger market by developing products to suit it.
Advantages of Niche Marketing
Small firms can thrive in niche markets where large forms have not yet been established
If there are no or very few competitors, firms can sell products at a high price and gain high profit margins because customers will be willing be willing to pay more for exclusive products
Firms can focus on the needs of just one customer group, thereby giving them an advantage over large firms who only sell to the mass market
Disadvantages of Niche Marketing
Lack of economies of scale (can’t benefit from the lower costs that arise from a larger operations/market)
Risk of over-dependence on a single product or market: if the demand for the product falls, the firm won’t have a mass product they can fall back on
Likely to attract competition if successful
Define Mass Marketing
selling the same product to the whole market with no attempt to target groups with in it.
Advantages of Mass Marketing
Larger amount of sales when compared to a niche market
Can benefit from economies of scale: a large volume of products are produced and so the average costs will be low when compared to a niche market
Risks are spread, unlike in a niche market. If the product isn’t successful in one market, it’s fine as there are several other markets
More chances for the business to grow since there is a large market. In niche markets, this is difficult as the product is only targeted towards a particular group.
Disadvantages of Mass Marketing
They will have to face more competition
Can’t charge a higher price than competition because they’re all selling similar products
Define Market Segmentation
is the process of dividing a market of potential customers into groups, or segments, based on different characteristics
