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Business studies paper 1 > Topic 1.2 Spotting a business opportunity > Flashcards

Topic 1.2 Spotting a business opportunity Flashcards

1
Q

What is the purpose of market research?

A
  • to identify and understand customer needs
  • to identify gaps in the market
  • to reduce risk
  • to help make business decisions
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2
Q

What are the 2 types of market research?

A

Primary research

Secondary research

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3
Q

What are the examples of primary research?

A

survey
questionnaire
focus group
observation

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4
Q

What are examples of secondary research?

A

internet
market reports
government reports

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5
Q

What is primary research?

A

Research that a person personally collects data people

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6
Q

What is secondary research?

A

Research that has already existed.

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7
Q

What is the advantage of primary research?

A
  • Questions are tailored to the business needs

- Can create a competitive edge

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8
Q

What are the disadvantage of primary research?

A
  • time consuming

- expensive

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9
Q

What are the advantages of secondary research?

A
  • quick and instant information access

- likely to be cheaper

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10
Q

What is the disadvantage to secondary research?

A
  • Competitor also has the same access to information (the company doesn’t have a competitive edge)
  • Can be out of date
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11
Q

What is qualitative data?

A

non-numerical data

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12
Q

what is quantitative data?

A

numerical data

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13
Q

Why do business use social media?

A

It is a cheap way to collect information on market trends, customer opinions and the actions of their competitor.

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14
Q

What is the importance of having reliable data?

A

Basing decisions on unreliable research can be very costly to a business. Therefore the business should avoid bias within research.

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15
Q

What is market segmentation?

A

Is a group of buyers with similar characteristics and buying habits.

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16
Q

What are the market segments? (6)

A 
Age 
Gender
Income
Location
Lifestyle
Demographics
17
Q

What are the benefits of segmentation?

A
  • meet specific customer needs
  • differentiate its product
  • focus on a specific group of customer
  • develop a unique brand image
18
Q

What are the limitations of segmentation?

A
  • expensive
  • business may miss opportunities
  • customer characteristics can change overtime
19
Q

What is the purpose of market mapping?

A

To identify gaps in the business

20
Q

What is the benefit of market mapping?

A
  • helps to identify potential gaps in the market
  • Helps business to identify their rivals
  • Helps make business decisions
21
Q

What are the drawback of market mapping?

A
  • based on opinion and perspective

- compares business from two variables

Business studies paper 1 (5 decks)

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