Summer Mock Theme 1 Flashcards
What are the 2 main types of market ?
Niche and Mass
What is the mass market ?
-The mass market is an market when business make products/services for all customers.
-The mass market is larger and the products are more generalised.
-e.g McDonalds
What is the niche market ?
-The niche market provides products/services which focus on the customers specific want or need.
-e.g Leon
Name 3 mass market benefits
-Having more customers.
-Benefitting from economies of scale (due to higher output levels).
-Can build a strong market presence.
Name 3 mass market disadvantages
-Higher levels of competition.
-Lower profit margins
Name 5 niche market benefits
-Less competition.
-Specific market.
-Can develop specific expertise.
-Higher profit margins.
-Customer loyalty.
Name 2 niche market disadvantages
-No economies of scale.
-Vulnerability because they have an indiverse product portfolio.
What is a brand ?
-A brand is a good or service that has something which is unique & recognisable.
-This could be from the way that the product is designed or a different feature.
What can a strong brand lead to ?
Strong brand example.
-Higher customer loyalty
-Leading to larger profits
-e.g Nike
Marketing mix definition
The plan for getting the blend of product, price, place and promotion
What is a market objective ?
A target that a marketing department within a business must acheive.
What is market segmentation ?
Dividing a market by customer’s age, gender or income to find areas that are underserved
-e.g bikes for older people
Marketing strategy definition
A medium to long plan for meeting the marketing objectives delivered through the marketing mix
What is marketing ?
The department tasked with targeting the right product towards the right target market (audience) .
What is a dynamic market ?
Dynamic markets are markets that experience rapid and continuous change.
What is product differentiation ?
Differentiation is the characteristics that make a business’ product or service stand out to its target audience
Market size definition
The total amount of sales/customers in a market. Measured by value/volume.
Name 2 risks that entrepreneurs may face when starting a business
-Financial loss
-Lack of security
What is uncertainty ?
Uncertainty is when a business cannot know how a situation will turn out
What is risk ?
Risk is where there is a chance that something could go wrong & not end up as expected.
What is market research ?
Market research is the process of gathering information about customers, competitors and distributors within a businesses target market.
What is primary research ?
-Primary research is finding out information first hand.
-e.g a business designing a quiz to obtain knowledge on who buys their products.
What is secondary research ?
-Secondary research is finding out information that has already been gathered.
-e.g government estimates of the number of cars in the UK
Give 2 examples of secondary research
-News articles
-Government records
Give 2 examples of primary research
-Surveys
-Focus Groups
What is quantitative research ?
A research method that uses mathematical analysis and data to provide information about a business and market.
.What is qualitative research ?
A research method that is based on the customers opinions, values and beliefs about a business.
What is YED ?
Income elasticity of demand (YED) measures the responsiveness of quantity demanded to a change in consumer income.
YED formula
YED = (% change in quantity demanded) ÷ (% change in income)
If the YED coefficient is positive an increase in income =
an increase in demand
If the YED coefficient is negative an increase in income =
a decrease in demand
If the income elasticity of demand is less than 1 then this is described as ………
inelastic (the quantity demanded is less than the change in income)
If the income elasticity of demand is more than 1 then this is described as ………
elastic (the quantity demanded is more than the change in income)
What is an inferior good ?
Increase in income = decrease in demand
What is a normal good ?
Increase in income = increase in demand
What is a luxury good ?
Increase in income = decrease in demand (more than what is proportional to income)
What is economies of scale ?
A proportionate saving in costs gained by an increased level of production.
What is a subsidy ?
A transfer of money from the government to an entity (business)
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