The Market Flashcards
WHAT is a NICHE MARKET?
A smaller segment of a mass market, where a business caters its products to consumers, with specific needs/wants.
WHAT is a MASS MARKET?
A large amount of consumers, who’s needs and wants, are the same or similar to others.
What are the BENEFITS of operating within a MASS MARKET?
Ability to achive economies of scale
Ability to conduct ethnocentric marketing approach
Promotions have higher chance to increase market share
Able to create large cash-inflow channels
What are the DRAWBACKS of operating within a MASS MARKET?
High amounts of competition (Rivals)
Lack of differentiation, may lead to decline in demand
What are the ADVANTAGES of operating within a NICHE MARKET
Ability to charge premium pricing
Ability to experince high profits
Profits can be invested towards R&D/product development
Strong brand can created
Higher chance of customer loyalty
Able to differentiate amongst competitors, stimulating demand
What are the DRAWBACKS of operating within a NICHE MARKET
Very expensive to finance, without stable amount of cash-inflows (BUSINESS ANGELS/REVENUE)
Product development/R&D can be very time-consuming
Products are of high quality, so high dependency on rare raw maerials, that may come from conflict zones + depletion of natural resources (UN-ETHICAL)
How to maintain MARKET SHARE?
The STRONGER the BRAND, the STRONGER CUSTOMER LOYALTY
WHAT is MARKET SIZE?
INDICATES the AMOUNT OF SALES a BUSINESS CAN ACHIEVE
WHAT is MARKET GROWTH?
The decline or INCREASE of CONSUMER DEMAND, within the market a business operates within
WHAT is MARKET SHARE?
TOTAL SALES OF BUSINESS PRODUCTS / TOTAL SALES WITHIN MARKET X 100 = ANS(%)
WHAT is a BRAND/BRANDING?
A DESIGN, LOGO or form of GOODWILL, which represents the businesses product(s).
BENEFITS of a BRAND/BRANDING
Ability to DIFFERENTIATE from competitors (USP)
STRONG CUSTOMER LOYALTY
Ability to charge PREMIUM PRICING (PRICING STRATAGIES)
Enables a business to reach intended market more efficiently
DRAWBACKS of having a BRAND/BRANDING?
Can be highly expensive to create and sustain
If brand experiences BAD PR, INVESTORS may CEASE FUNDING & DEMAND may DECLINE
WHAT is COMPETITIVE ADVANTAGE?
When a business DIFFERENTIATES itself from competitors through adapting its products AEETHETICS, PRICE, QUALITY OR FUNCTION (4P’s)
What is the DIFFERENCE between INNOVATION & INVENTION?
INVENTION = New + Original idea for a NEW product
INNOVATION = Using a new idea, to further develop a pre-existing product
