THEME 1: SECTION 1 (MEETING CUSTOMER NEEDS) Flashcards
Define the term MARKET
The buyers and sellers that trade a particular type of product in a particular place
Define MASS MARKETS
Markets with products aimed at a large demographic, often standardised products.
Define NICHE MARKETS
Products aimed at a specific demographic of buyers, often specialised products
Define MARKET SIZE
The total value of sales or consumers in that market over a certain time period
Define MARKET SHARE
The proportion of the total market that the business holds
Define SALES GROWTH
The changes in a company’s sales from one period to the next.
Define MARKET GROWTH
The change in the size of a market for a product or service over time.
What is the MARKET SIZE FORMULA
The sum of all sales in the market ( in terms of value or volume)
What is the MARKET SHARE EQUATION
Total sales of the business / total sales of the market ( x 100)
What is the market growth equation
new market size - old market size / old market size (x 100)
What is the SALES GROWTH FORMULA
new sales - old sales / old sales (x 100)
Define and explain DYNAMIC MARKETS
Markets that change and evolve rapidly. Due to: changing consumer preferences, innovation, competition or technology changes.
What is the difference between direct and indirect competition?
Direct competition = two or more businesses selling similar products that appeal to the same demographic
Indirect competition = when two or more businesses sell products that are different but compete for the same demographic.
Define MARKETING MIX, and what are the aspects in it?
The Marketing mix is a combination of factors that can be controlled by a company to influence consumers to purchase its products. It includes Product, Promotion, Pricing, Place.
What are the different characteristics of a mass and niche market?
Mass market = appeal to more people, low-profit margins, high competition, more consumers,
Niche Markets = appeals to a small demographic, costly, risky, less competition
Define MARKET RESEARCH
The collection and analysis of market information.
Define PRIMARY RESEARCH with 2 examples
Primary research is when new information is gathered by the business and is exclusive to them
- Focus groups
- surveys
Define SECONDARY RESEARCH and 2 examples
Secondary research is, collecting information that already exists.
- Books
- Magazines
What are the pros and Cons of qualitative market research?
Pros = new perspective
- understand attitudes
Cons= Time consuming / smaller sample size
- possible bias due to circumstances of the
applicant
What are the pros and Cons of quantitative market research?
Pros = Quicker/ cheaper
- Samples are more randomised
Cons = cannot determine if answers are true or not
- Shows correlation but doesn’t explain it
Define QUANTITATIVE ANALYSIS
Numerical data collected through closed questions such as multiple choice.
Define QUALITATIVE ANALYSIS
Opinion based research gathered through open questions.
What are the pros and Cons of Primary market research?
Pros = specific
- ensures its up to date with current situations
Cons = Expensive
- Time consuming
Three ADVANTAGES of MARKET RESEARCH
- identifies threats and opportunities
- Predicts trends
- Keep up with competitors
Define MARKET POSITIONING (MAPPING)
Plotting competitors and their products on a matrix to understand their behaviour and spot a gap in the market.
-Positioning refers to the place that a brand occupies in the minds of the customers and how it is distinguished from the products of the competitors
What measures could be used on the market map?
Price vs Quality
Price vs Demographic
Define Product orientation with pros and cons
-The attitude of a company that believes the product comes first and persuading customers to buy it follows.
Pros: Efficient, economies of scale
Cons: missing market opportunities, not meeting needs = lowers demand
Define Market Orientation with pros and cons
prioritizes identifying the needs and desires of consumers and creating products and services that satisfy them.
Pros: Increased customer loyalty, customer satisfaction
Cons: decreases differentiation and USP, reduces innovation and creativity (could leader to being less flexible with changing tastes etc)
