Paper 1+2 Divider 4 Flashcards
Market mapping
Positions produce on a matrix according to who measures the customers value
Market mapping adv
- gap in the market
- identify close competitors
- repositioning=better business image
Market mapping disad
- too simple
- subjective, based on opinion not data
Primary research
Collection of new info
Focus groups, questionnaires, interviews
Primary research adv
- up to date
- specific to business
Primary research disad
- expensive
- time consuming
Secondary research
Collecting info that already exist
Internet, feedback from sales employees
Secondary research adv
- quicker to assess
- cheaper freely available
Secondary research disad
- costly to buy specialist reports
- out of date data
Qualitive
- finding out buying habits
- focus groups
- reveal customer psychology
Quantitive
- questionnaires
- give clear valid statistic conclusions
Sampling
- market research, like questionnaires
- business asks a small group of consumers
- reduces cost and time, rather than asking whole population
Correlation
- positive: as independent variable increases, so does dependant
- negative: as independent increases, dependent decreases
- none: no relationship
-used to make predictions, but could be down to a coinscidence or external factors
Confidence interval
- expressed as a %
- indicates of how likely the results obtain from a sample can be applied to the population
- the higher the confidence level, the wider the interval
- interval: a range of values you think the population will lie in
Extrapolation
- used to forecast sales
- projection forward of a trend line in order to make a forecast of what wil happen in the future
Extrapolation adv
- simple, quick, easy, done by eyes
- useful, for short term forecasting
Extrapolation disad
- doesn’t take into account external factors
- assumes there is no histoiric events
Using tech to make decisions
- loyalty cards
- could see what products sell more than others and increase customer satisfaction to avoid selling out
Elasticity of demand
-measures the extent to which demand for a product changes when its price changes
- price increase=decrease in revenue
- price cut=increase in sales
Value of concepts
- pricing decsions: a business might increase the price of more inelastic products
- output decisions: how much to increase output if dropping the price
- marketing mix: to make it more inelastic, e.g, through advertising
The use of data adv
-up to date, makes better decisions
The use of data disad
-needs to take into account feelings and a sense of where the market might be going (growth/innovation)
