theme 1 Flashcards
1.1 define market vs marketing
market- where buyers and sellers meet
marketing- communication about your product/service
1.1 define niche vs mass marketing
niche- small segment of a larger market, products have high levels of differentiation
mass- selling into the largest part of the market, competitors sell similar products
1.1 what are some benefits of mass market
- highly profitable due to high sales volume
- can benefit from economies of scale due to high levels of output
- universal appeal
1.1 what are some benefits and drawbacks of niche market
b: less competition
- higher profit margin per item
- customer loyalty
d: lack of economies of scale
- attracts competition if successful
- vulnerable to market changes
1.1 give examples of reasons markets are dynamic
- customers tastes and preferences change
- impact of tech on what customers buy and how they buy
- impact of new market entrants
1.1 define innovation and what is product vs process innovation
putting a new idea or approach into action
product: launching new/improved products
process: finding better ways of producing existing products or delivering services
1.1 what are some advantages of product innovation
- can charge higher prices= profit
-improve competitiveness - enhanced reputation
- build earlier customer loyalty
1.1 what are some advantages of process innovation
- reduces costs
- more responsive customer service
- improved quality
1.1 define market research
act of gathering information about customers’ needs and preferences to reduce risk of failure
1.1 what is product orientation
an approach where businesses focus on their products- developing products bases on what its good at doing
1.1 what is market orientation
an approach where businesses prioritise needs and desires of consumers to create products and services that satisfy them
1.1 define market segmentation
dividing a market into parts that reflect customer needs and wants. e.g age, gender, income
1.1 what are some benefits of market segmentation
-helps with new product development
- better matching of customer needs
- allows businesses to grow their share of the market
1.1 what are some drawbacks of market segmentation
- markets are dynamic so change rapidly
- data may not always be available or reliable
1.1 what is market mapping
a diagram with two axis that can identify products competitors offer and find gaps in the market
1.1 what are advantages of using market mapping
- can analyse competitors to see where to launch products
- helps spot gaps in the market
1.1 what are drawbacks of market mapping
- not a guaranteed success
- juts because there’s a gap in the market doesn’t mean there’s demand for the product
1.1 what is added value and why is it important
the difference between price of raw materials and selling price.
adding value pays wages for workers. without workers there are no products
1.1 what are some ways a business can add value to a product
- convenience
-high quality service - brand name
- USP
1.1 what are benefits of added value
- charge higher price
- USP from competitors
- focus on target Market
1.1 how does competition affect a business
- less demand for a product
- lower income due to costs for advertising
1.1 why is market research important
gives insight into demand and helps spot opportunities and threats
