Meeting customer needs Flashcards
Topics 1-3
What is a mass market?
A market aimed at the general population. E.g. Colgate.
What is a niche market?
A subset of the main market and addresses a specialist need. E.g. sensodyne toothpaste for sensitive teeth.
Mass markets often have _____ scale production and therefore have ______ average costs. Large volumes of ______ can lead to greater revenues and profits. However, there is lots of __________, and firms will need to effectively ____________ in order to stand out.
large
lower
sales
competiton
differentiate
In a niche market, firms have the ability to charge a premium price, and often find it easier to ________ customers and meet their _______. However, these markets may be _______ as demand may not be constant. There is also ________ unit costs.
target
needs
risky
higher
What is the formula for market share?
Total sales of company / total sales of market X 100
In which type of market is branding most important, and why?
Mass markets, as it is used to differentiate products.
What is a dynamic market and what impact does it have on a business?
Dynamic markets change over time. Companies have to adapt as markets shrink, grow, emerge or disappear. Dynamic markets have a huge impact on businesses, because failure to adapt can be fatal.
The growth of the ________ may enable market growth as with the population becoming more ________, they have more money available to _______, as well as their needs and wants changing.
economy
affluent
spend
What are some factors that could affect the growth of markets?
Economic growth
Innovation
Social changes, including demographic changes
Changes in legislation
There are many ways a business can adapt to change. Businesses can become ________, conduct market _______, invest into _______ developments, encourage ________ or choose to develop a ______.
flexible
research
long-term
kaizen
niche
Businesses can do many things in order to encourage customers to choose them over rivals. They could lower ______, make products look __________, improve _______, or invest into __________ campaigns.
prices
different
quality
advertising
What is the difference between risk and uncertainty?
Risk is taking actions where the outcome is unknown. By contrast, uncertainty is where things are subject to external influences, beyond the control of businesses.
What does it mean to be product orientated?
Product orientation is where the business focuses on the product itself. It puts most of its effort into developing products.
What does it mean to be market orientated?
Market orientation is where a business continually identifies, reviews and analyses consumer needs. They are led by the market.
There are three main factors determining whether a firm is product or market orientated. In markets where ____________ is required, it makes sense to be product orientated. They may also be influenced by business _________ and the level of __________ in the market.
innovation
objectives
competiton
What is market research, and what is one benefit of conducting it?
Market research is gathering, presenting and analysing information about marketing and consumption of goods. It helps to reduce the risk of failure.
What are some uses of market research?
1= Helps to reduce the risk of failure
2= Identifies customer needs and wants
3= Assesses the likely demand - reduces waste
4= Insight on consumer behaviour
Primary market research involves data that does not already exist, such as:
1= Q___________
2= S_________ & I__________
3= C_________ P_______
4= O_______________
Questionairres
Surveys & Interviews
Consumer Panels
Observation
What is test marketing and why would it be used?
Test marketing is where a product is sold in a restricted geographical area to test it before a national launch. It is used in order to reduce the risk of failure and waste of resources.
Secondary research involves data that already exists, such as:
1= S_______ F_________
2= S_________ I__________
3= G_____________ P_________
4= C___________ W___________
Sales Figures
Stock Information
Government Publications
Competitor Websites
There are many limitations to conducting market research. It is estimated that __% of all products fail, and not all data is _______. It also relies on _______ behaviour which is not always consistent.
90
reliable
human
What is market segmentation? And what different types of segmentation is there?
Market segmentation is where markets are divided into different segments. There is geographical, demographic, psychographic and behavioural.
What benefits are there to a business of segmenting a market?
Allows customer needs to be met
Increases revenue
Increases loyalty as products are tailored to them
Avoids wasted money and resources
Market position is based on the ____________ that customers have about a businesses products. It is based on ________, _______ and value for _______. Customers will categorise businesses into ‘positions’ such as the idea that Coca Cola is above Pepsi.
perceptions
quality
status
money
