Marketing Flashcards
What are market-led businesses?
Market-Led Businesses use intensive market research to discovered customers needs and wants to then create a product in order to satisfy those needs and wants.
What are the features of market-led organizations?
- They are very customer focused.
- More responsive to changes in the market.
- Often apart of competitive markets such as makeup + clothing.
- Reliant on market research to inform their product development.
Advantages of market-led businesses?
- Able to adapt to changing needs of customers.
- More confident launching successful products/services.
- Stronger position to deal with rival companies.
Disadvantages of market-led businesses?
- Market research is expensive and time consuming.
- Future is unpredictable therefore high risk of failure.
- Constant change within organization as it strives to meet the aims of the market.
What are product-led businesses?
Product-Led Businesses develop their product first and then use intensive advertisement in order to sell it. Little to no market research is carried out before production begins. Instead time and money is spent on researching and developing the product.
What are the features of product-led organization’s?
- Often in high tech industries (APPLE)
- They have little competition.
- Companies such as APPLE and TESLA would operate as a product-led business.
Advantages of product-led businesses?
- Can focus on quality of product or service.
- Can outsource production to focus on core design.
- Organization can invest in technology and apply it to a wide range of products/services.
Disadvantages of product-led businesses?
- The needs of the market are ignored.
- Changes in taste and fashion will not be accounted for.
- Technology could quickly be superseded when competitors enter market and product becomes out-of-date.
Why do businesses research into consumer behavior?
Businesses look into consumer behavior so they can better understand the decision behind why customers purchase certain products. As well as to understand what influences them to make them purchasing decisions.
Businesses want to understand this decision-making process so they can better tailor their companies marketing strategy to meet their needs.
What are the different types of consumer behavior?
- Routine/Habitual
- Informed
- Impulsive
What is routine/habitual consumer behavior?
Routine purchases require little involvement by the customer.
Routine purchases are made automatically for items such as:
- Cereal
- Washing power
- Toiletries
What sale promotions are used to influence routine purchasing?
Money off vouchers or buy-one-get-one-free
What is impulsive consumer behavior?
Impulsive buying is purchases that happen without prior planning or thought.
Impulse purchasing often happens because a product catches a customer eye, for example the minis products at checkout.
Effective point of sale displays can influence impulse purchasing.
What is informed consumer behavior?
Informed consumer behavior is when the buyer takes time to investigate the product.
They will consider different products that are on offer and the specifics of the product they are interested in.
This behavior is usually used when a customer is buying expensive long-term goods such as:
- a car
- an expensive item of technology (phone, laptop, iPad etc)
Why does a business conduct market research before and whilst launching a new product?
A business conducts market research to help identify gaps in the market and business opportunities.
It is important to establish consumers need before launching a new product which market research can help a business discover.
