Theme 1 Key Terms Flashcards
1
Q
What is a Brand?
A
A symbol, logo or design that is recognisable and distinguishes a product from competitors.
2
Q
What is a Competitive market?
A
The rivalry among sellers trying to achieve goals such as increasing profits, market share, and sales volume.
3
Q
What is a Competitor?
A
A rival business operating in the same market offering similar goods or services.
4
Q
What is Direct competition?
A
Businesses produce similar products that appeal to the same group of customers.
5
Q
What is a Dynamic market?
A
A market that is subject to rapid/continuous change.
6
Q
What is Indirect competition?
A
Different businesses make or sell products that are not in direct competition but compete for the same customer experience.
7
Q
What is Innovation?
A
The creation, development and implementation of a new product, process or service.
8
Q
What is a Market?
A
Where buyers and sellers interact.
9
Q
What is Market growth?
A
An increase in demand/sales for a particular product/service.
10
Q
What is Market share?
A
The % of the total market a business has in terms of volume.
11
Q
What is Market size?
A
The total amount of sales/customers in a market measured by value/volume.
12
Q
What is a Mass market?
A
A large unsegmented market where mass appeal products are sold.
13
Q
What is a Niche market?
A
A specialist area of the market/is a subset of the market on which a specific product focuses.
14
Q
What is Online retailing?
A
Selling goods and services on the internet.
15
Q
What is Product innovation?
A
The development/creation of products not previously available.
16
Q
What is Sales volume?
A
The quantity of a good or service sold within a period of time.
17
Q
What is Uncertainty?
A
The inability to predict/a lack of knowledge about future events and outcomes.
18
Q
What are Biased questions?
A
Where the questions do not produce findings that give a true reflection of the views of the target audience on the product or service.
19
Q
What is competitive advantage?
A
A feature of a business that allows it to compete effectively with rivals.
20
Q
What is differentiation?
A
Making products or services distinct from competitors.
21
Q
What is market research?
A
Gathering, presenting and analysing information about products/customers.
22
Q
What is market segmentation?
A
Dividing a whole market into particular customer groups that have similar characteristics.
23
Q
What are market segments?
A
An identifiable group of individuals where consumers share one or more characteristics or needs.
24
Q
What is primary market research?
A
Obtaining data first hand by the business to match specific needs.
25
What is secondary market research?
Data collected by another business or organisation but used by the business in question.
26
What is qualitative research?
Market research collected relating to the opinions and beliefs of consumers.
27
What is quantitative research?
Numerical information gathered and can be presented and analysed using graphs, charts, etc.
28
What is interview bias?
Where the opinion of the interviewer interferes with the judgements of the interviewee.
29
What is respondent bias?
When respondents respond inaccurately to a question.
30
What is market orientation?
When a business's products/services are based around the needs and wants of the customer.
31
What is product orientation?
When a business prioritises a product's design quality or performance rather than meeting customer preferences.
32
What is a focus group?
A group of people who participate in a discussion as part of market research to give feedback about a product or service.
33
What is a survey?
A research method used where the interviewer communicates directly with the respondent using a questionnaire.
34
What is a market map?
A document that contains information, stats, research and facts on a chosen field.
35
What is test marketing?
Trialling the product in a small area or to a limited number of users to assess the suitability of a product.
36
What is added value?
The increase in value that a business creates when producing a product/service.
37
What are trade publications?
Specialist magazines that look at current trends in the business world.
38
What is social networking?
A platform such as Facebook, X, and YouTube, which can be used to market a business's products/services.
39
What are market reports?
Documents that contain information, stats, research, and facts on a chosen field.
40
What are observations in market research?
Where market researchers watch the behaviour of customers.
41
What is a sample?
A small group of people who must represent a proportion of a total market when carrying out market research.
42
43
What is consumer behaviour?
How consumers make decisions about how they choose and use products or services.
44
What are databases?
An organised collection of data stored electronically with instant access, searching and sorting facilities.
45
What is a face-to-face survey?
A research method used where the interviewer communicates directly with the respondent using a questionnaire.
46
What is a focus group?
A group of people who participate in a discussion as part of market research to give feedback about a product or service.
47
What is government data?
Government publications that a business can use such as the census of the population.
48
What is interview bias?
Where the opinion of the interviewer interferes with the judgements of the interviewee.
49
What is market orientation?
When a business's products/services are based around the needs and wants of the customer.
50
What is market research?
Gathering, presenting and analysing information about products/customers.
51
What are market reports?
A document that contains information, stats, research and facts on a chosen field.
52
What is market segmentation?
Dividing a whole market into particular customer groups that have similar characteristics.
53
What are market segments?
An identifiable group of individuals/a part of the market where consumers share one or more characteristic or need.
54
What are observations in market research?
Where market researchers watch the behaviour of customers.
55
What is primary market research?
Market research collected relating to the opinions and beliefs of consumers. Data not presented numerically.
56
What is product orientation?
When a business prioritises a product's design quality or performance rather than meeting customer preferences to guide production and marketing decisions.
57
What is qualitative research?
Research data that is not presented numerically.
58
What is quantitative research?
Numerical information gathered and can be presented and analysed using graphs, charts, tables, etc.
59
What is respondent bias?
When respondents respond inaccurately to a question for some reason.
60
What is a sample in market research?
A small group of people who must represent a proportion of a total market when carrying out market research.
61
What is secondary market research?
Data collected by another business or organisation but used by the business in question. Also known as desk research.
62
63
What is competitive advantage?
A feature of a business and/or its products that enable it to compete effectively with rival producers/products.
64
What is differentiation?
Making products or services different or distinct from competing products/creating a USP.
65
What is market mapping?
A form of market positioning that uses a 2-dimensional diagram to plot products or services in a market using two key variables.
66
What is market positioning?
An effort to influence consumer perception of a brand or product, relative to the perception of competing brands or products.
67
What is product differentiation?
The act of distinguishing a product/service from competitors to make it more attractive to a particular target market.
68
What are complementary goods?
Products consumed/used together, so they are purchased together.
## Footnote
E.g. printer and printer ink.
69
What is consumer income?
The money earned/received from work/investments.
70
What is demand?
The quantity of goods/services that a consumer is willing to buy at a given price and at a given time.
71
What are demographics?
The structure of the population such as age, gender and geographical distribution.
72
What are external shocks?
Factors beyond the control of a business.
73
What is seasonality?
When demand rises or falls at particular times of the year according to seasonal factors.
74
What are substitutes?
Goods that can be bought as an alternative to others, but perform the same function.
## Footnote
E.g. petrol car and electric car.
75
What are government subsidies?
A payment given to producers, usually to encourage production of a certain good.
76
What are indirect taxes?
Taxes imposed by the government on spending e.g. VAT and Excise duties. Responsibility for payment lies with the business.
77
What is supply?
The amount that producers are willing/able to produce at a given price/over a given period of time.
78
What is equilibrium price?
The price where supply and demand are equal. Also known as market clearing price.
79
What are non-price factors?
Factors other than price e.g. Change in consumer incomes, advertising and seasonality.
80
What is a shortage in markets?
Where demand exceeds supply.
81
What is a surplus in markets?
Where supply exceeds demand.
82
What are luxury goods?
Goods that consumers like to buy if they can afford them.
## Footnote
E.g. air travel and fashion items.
83
What are necessity goods?
Basic goods that consumers need to buy.
## Footnote
E.g. food, electricity and water.
84
What is price elastic demand?
Quantity demand is responsive to a change in price.
85
What is price elasticity of demand (PED)?
Measures the responsiveness of quantity demanded to a change in price. Always negative due to laws of demand.
86
What is price inelastic demand?
Quantity demanded for the product is less responsive proportionately to a change in price.
87
What is income elasticity of demand (YED)?
Measures the responsiveness of changes in quantity demanded to changes in consumer income.
88
89
What is an inferior good?
When incomes increase, there is a decrease in quantity demanded, e.g., budget goods.
90
What is the marketing mix?
A plan for using the right blend of product, price, promotion, and place in order to maximise sales.
91
What are social trends?
Changing patterns in consumer behaviour reflected in changing demands, e.g., increased use of social media/being environmentally friendly.
92
What does aesthetics refer to in product design?
Relates to the appearance of a product.
93
What is cost in the design mix?
When the business focuses on being economically viable, therefore they aim to minimise costs.
94
What does design for recycling mean?
Producing products using materials that have been discarded as waste and recycled.
95
What is design for reuse?
When a product is designed to allow for disassembly at the end of its life and the re-use of the materials.
96
What is design for waste minimisation?
Reducing the quantity of resources that are discarded in the production process.
97
What is the design mix?
The combination of factors needed in designing a product including Aesthetics, Function, Economic Manufacture.
98
What is ethical sourcing?
When a business buys materials that are produced with fair working conditions/pay and minimum impact on the environment.
99
What does function refer to in product design?
Relates to the quality and reliability of a product.
100
What is rebranding?
A marketing strategy in which a new name, term, symbol, design or combination is created for an established brand with the intention of developing a new, differentiated identity in the minds of consumers, investors, and/or competitors.
101
What is resource depletion?
The using up of natural resources.
102
What is advertising?
A paid form of communication, used by a business to raise customer awareness of its products, services and brands, to persuade purchases to be made.
103
What is customer loyalty?
Customers favouring a business over competitors when making a purchase.
104
What does repeat purchases mean?
Means that customers will return to the business again and again.
105
What are digital communications?
The electronic transfer of data.
106
What is direct marketing?
Where a business mails out leaflets or letters to households.
107
What is emotional branding?
The creation of brands that may appeal to customers' emotional nature, rather than their logical side.
108
What is manufacture/corporate branding?
Brands created by the producers of goods and services, e.g., Kellogg's cornflakes.
109
What is an own brand?
Products that are manufactured for wholesalers or retailers by other businesses, e.g., Tesco Beans.
110
What is personal selling?
Direct communication between a salesperson and the customer.
111
112
What is a premium price?
Charging a higher price than competitors because of customer loyalty that has been built up over a period of time.
113
What is generic branding?
Products that only contain the name of the product category rather than the company or product name e.g. Carrots.
114
What is the purpose of promotion?
The way a business creates demand/awareness for its product/service.
115
What is public relations?
An organisation's attempt to communicate with interested parties, usually through unpaid media such as press.
116
What are sales promotions?
Methods of promoting products in the short term to boost sales.
117
What is social media?
Websites and applications that enable users to participate in social networking.
118
What is sponsorship?
A company giving a product or money to support another, often in return for brand visibility.
119
What is a Unique Selling Point (USP)?
A feature that differentiates a product from its competitors.
120
What is viral marketing?
Encouraging customers to share information/adverts through existing social media platforms e.g. Facebook.
121
What is competitive pricing?
When a business sets a price similar to competitors selling similar/rival products.
122
What is cost plus pricing?
A cost-based method for setting the prices of goods and services calculated by adding a mark-up percentage.
123
What is penetration pricing?
Setting a low price initially to build market share before switching to a more profitable price.
124
What is predatory pricing?
Setting a low price to force rivals out of the market; this is illegal in the UK but difficult to prove.
125
What are price comparison websites?
Websites that compare the price of a particular product or service in different stores or from different businesses.
126
What is price skimming?
Setting a high price at the launch of a product to recover R&D costs and attract early adopters.
127
What is a pricing strategy?
The approach a business takes to setting the price of its product/service e.g. penetration, price skimming.
128
What is psychological pricing?
Tactics designed to appeal to a customer's emotional response to prices.
129
What are channels of distribution?
Methods used by businesses to get their products from manufacture to consumer.
130
What is distribution?
Getting products to the right place for customers and at the right time.
131
132
What is a distribution strategy?
A plan to get a product or service to the customer.
133
What is a four stage distribution channel?
Manufacturer/producer to wholesaler to retailer, then consumer.
## Footnote
Examples include groceries and confectionery.
134
What is a distribution channel?
Where the product can be purchased and is also the process of making a product or service available to the consumer.
135
What is the Boston matrix?
A method used to analyse the product portfolio of a business that contains stars, cash cows, question marks, and dogs.
136
What is business-to-business (B2B)?
When a business promotes the sale of products/services to other businesses for use in their operations.
137
What is business-to-consumer (B2C)?
Where a company targets to sell its products to individual customers.
138
What is an extension strategy?
A plan that is aimed at preventing the decline stage of a product/service's sales in the medium-to-long term.
139
What is a marketing objective?
A goal the business aims to achieve through its marketing.
140
What is a marketing strategy?
The methods used/plan/way chosen to achieve marketing objectives.
141
What is portfolio analysis?
When business considers each of its products in the context of its market position.
142
What is the product life cycle?
The stages that a product goes through from introduction to decline.
143
What is a product portfolio?
The collection/range/list of items/products produced/sold/offered by a business.
144
What is collective bargaining?
Negotiation of wages/conditions of employment between employee representatives/trade unions and the employer.
145
What is dismissal?
Referred to informally as firing or sacking. It is the termination of employment by an employer against the will of the employee.
146
What are employer/employee relations?
The way in which a company's management and its employees behave towards each other.
147
What is an individual approach to employer/employee relations?
When employers develop relationships with employees at an individual level.
148
What is multiskilling?
The process of increasing the skills of employees.
149
What are part-time employees?
Workers that generally work a few hours or a few days a week. Fewer hours than a full-time employee.
150
What is redundancy?
When a business needs to reduce the size of its workforce or even close. Redundancy can be voluntary.
151
What is staff as a cost?
A cost to businesses in terms of recruitment, training, remuneration, welfare, and even severance.
152
What is staff as an asset?
Employers recognise the input of employees as an important business resource. They contribute to the value of output.
153
154
What is temporary work?
The job position is generally for a limited period of time.
155
What are trade unions?
A workforce representative that acts to protect and improve the economic and working conditions for their members.
156
What is external recruitment?
When the business looks to fill the vacancy from outside of the business.
157
What is induction training?
Introductory training given to employees covering its background, policies, health and safety procedures.
158
What is internal recruitment?
Selecting employees who already work within the business to fill job vacancies.
159
What is off-the-job training?
When employees are given training away from their normal job environment, often in a classroom.
160
What is on-the-job training?
Learning/gaining/developing skills whilst at work doing the job.
161
What is recruitment?
The process of finding and selecting workers.
162
What is training?
The developing of a person, to enhance skills and knowledge. Training can be on-the-job or off-the-job.
163
What is a centralised structure?
An organisational structure where business decisions are made at the top of the hierarchy by senior management/or at the headquarters of a business.
164
What is a chain of command?
The way authority and power is organised in an organisation.
165
What is a decentralised structure?
When a business allows branches to take more control/make their own decisions.
166
What is a flat organisational structure?
A structure with few layers and a wider span of control for each manager.
167
What is hierarchy?
The order or levels of responsibility in an organisation, from the lowest to the highest.
168
What is a matrix organisational structure?
Organises employees from different disciplines or divisions into projects/teams.
169
What is an organisation structure?
A diagram that shows who is answerable to whom in an organisation. It can also show vertical and horizontal communication links.
170
What is span of control?
The number of employees/subordinates that a manager is responsible for.
171
What is a tall organisational structure?
One with many layers and a narrow span of control for each manager.
172
What is a bonus?
A sum of money added to an employee's wages/salary as a reward for performance when they reach or exceed their targets.
173
What is a commission?
A payment to a worker based on a percentage of the value of sales.
174
What is consultation?
Employee opinions/feedback are sought when making business decisions.
175
What is delegation?
Authority to pass down from superior to subordinate.
176
What is empowerment?
Giving official authority to employees to make decisions and to control their own work activities.
177
What are financial incentives?
Monetary rewards used to help improve staff motivation and achievement. They can include Piecework, commission, bonuses, profit sharing and performance related pay.
178
179
Flexible workforce
Employees have choice over how/when they work by agreement with the company.
## Footnote
E.g. zero hours contracts, homeworking, part-time
180
Flexible working
Offering different working hours/location/pattern of working that improve work-life balance/motivation for employees.
181
Job enlargement
Giving an employee more work to do of a similar nature, horizontally extending their work role.
182
Job enrichment
Giving employees greater responsibility and recognition by vertically extending their work role.
183
Job rotation
The changing of jobs or tasks.
184
Maslow's hierarchy of needs
The order of people's needs, starting with basic human needs.
185
Mayo's human relations theory
Emphasises the importance of the ways in which people interact and how they are treated. Motivation can improve when employees feel more involved.
186
Motivation
The reason for people's actions, willingness and goals.
187
Non-financial methods of motivation
Non-monetary rewards.
188
Non-financial techniques
Ways of encouraging employees without the use of monetary rewards.
## Footnote
Include consultation, empowerment, team working, flexible working and job rotation.
189
Performance-related pay
A financial reward to employees whose work is considered to have reached a required standard.
190
Piece rate
A payment system where employees are paid an agreed rate for every item produced.
191
Profit sharing
A form of financial incentive given to employees, where part of the profit of the business is shared amongst the employees.
192
Taylor's scientific management
Suggested a job could be broken down into constituent parts, so that the most efficient way of working could be calculated. He believed workers are motivated by money.
193
Team working
Organising people into working groups that have a common aim.
194
Working conditions
The physical surroundings and the atmosphere of the workplace, and the way staff are treated by managers.
195
Autocratic leadership
A leadership style where the decision-making is best kept with managers, who will direct subordinates with little consultation.
196
Democratic leadership
A type of leadership style in which members of the group take a participative role in the decision-making process. Group members are encouraged to share ideas and communication is two-ways.
197
Laissez-faire leadership
A leadership style where employees are encouraged to make their own decisions within certain limits.
198
Management
Having a vision, sharing that vision with others and providing direction.
## Footnote
The day-to-day organisation of the business, including staffing.
199
200
Paternalistic leaders
Leaders that are in control, but take the welfare of employees into account when making decisions.
201
Entrepreneur
Someone who organises a business venture by combining the other factors of production, namely land, labour and capital. They take risks to set up a business in the hope of profit/reward.
202
Entrepreneurship
The activity of setting up a business, taking on risks, normally in the hope of making a profit.
203
Resilience
The ability to recover from difficulties and try again.
204
Risk
Something an entrepreneur can essentially plan for. Probabilities of outcomes are known or at least understood or considered.
205
Entrepreneurial characteristics
Qualities or traits demonstrated by an individual starting up and running a business.
206
Entrepreneurial motive
Factors that drive a person to start a business.
207
Ethical stance
In support of a moral belief.
208
Home working
Setting up a business from home.
209
Independence
A desire to be one's own boss.
210
Profit Satisficing
Making enough profit to satisfy the needs of the business owner.
211
Social entrepreneurship
Setting up a business and showing concern for social issues.
212
Business objective
A goal/target set by the business in the short/medium term to help achieve its aim/mission.
213
Cost efficiency
Minimising costs/expenses/waste when producing a product or service.
214
Customer satisfaction
Is a measurement of how satisfied a customer is with their purchase.
215
Employee welfare
Facilities and benefits provided by a business to meet the well-being of the employee.
216
Objective
A goal/target set by the business to help achieve its aim/mission.
217
Profit maximisation
When the difference between sales revenue and cost is at its greatest.
218
Sales maximisation
An attempt to sell as much as possible in a given time period (or to generate as much sales revenue as possible).
219
Social objectives
A goal to benefit/improve the community.
220
Survival
A short-term business objective that aims to keep the business running.
221
Franchise
A business buys the right to trade using the brand/logo/business model of an existing firm in return for a fee/royalty.
222
Franchising
A business is allowed to trade using the brand/logo/business model of an existing firm in return for a fee/royalty.
223
Lifestyle business
A business set up with the aim of making no more than a set level of income from which to enjoy a particular lifestyle.
224
Partnership
A type of business ownership/organisation owned by two or more people.
225
Private limited company
A small to medium sized business, usually run by the family that owns it. Shares are sold to friends, family, and business associates and it has limited liability.
226
227
What is a public limited company?
A business with limited liability whose shares are publicly traded on the stock market.
228
What characterizes a social enterprise?
A business that has aims/objectives which benefit society and is not for profit; its profits are reinvested into the business/community.
229
What is a sole trader?
A business that is owned by one person who has unlimited liability.
230
What is flotation in business?
When a business sells shares publicly on the stock exchange for the first time.
231
What is opportunity cost?
The next best alternative forgone when making a decision.
232
What is a trade-off?
A situation where having more of one thing leads to having less of something else.
233
What defines a leader?
A person who inspires and motivates others to meet objectives.
