1.1 -meeting customer needs

Question 1

mass market

Answer 1

aimed at large group of people
product has a wide appeal and is useful to a variety of people
larger market size

Question 2

niche market

Answer 2

aimed at a specific group of buyers
specialised to meet particular requirements
less competition

Question 3

market size

Answer 3

total value of sales in a market over certain period of time

Question 4

market share

Answer 4

proportion of total market that the business holds

Question 5

branding

Answer 5

creates a clear and obvious logo, name or statement that customers can instantly recognise
helps to differentiate from competitors

Question 6

dynamic markets

Answer 6

constantly changing and evolving rapidly

Question 7

how can a market change

Answer 7

• consumer preferences
• innovation - new products emerge
• ways in which customers want to shop may change- online
• competitors- enter or leave market
• changes in legislation- can affect products sold in market

businesses need to adapt and change to suit these changes in order to be successful and maintain market share

Question 8

benefits of online retailing

Answer 8

• lower costs as dont need to have physical shop or hire as many staff
• customer can order at anytime from anywhere in the world
• customers can easily compare prices

Question 9

drawbacks of onlie retailing

Answer 9

• businesses face more competition ad customers can easily shop around
• some products like to see products before they buy and may want to speak to staff
• businesses need to make sure customer personal deatilas are protected and kept safe from cyber criminals

Question 10

competition

Answer 10

direct- 2 or more businesses sell similar products that appeal to the same group of customers
indirect- 2 or more products sell different products but are competing for same customers

Question 11

how does competition affect how a firm operates

Answer 11

product- good quality, distinctive, lots of innovation, unique appeal
promotion - get products noticed, branding, celebrity endorsement
pricing- competitive pricing: penetration
place- easy for customers to access

Question 12

risk

Answer 12

always a chance something could go wrong
probabliities of different outcomes are unknown
before making a decision a business ca consider the proabbility of negative outcome and minimise chance of this happening

Question 13

uncertainty

Answer 13

unexpected events
often things firms know could happen nut difficult to predict if or when they will actually happen or what the outcome will be
external things a business cant control, bad weather

Question 14

product orientation

Answer 14

focus heavily on design, quality or performance of products rather than what the consumer actually wants

Question 15

market orientation

Answer 15

focus heavily on selling products that match customer preferences
invests a lot in market research

Question 16

effective market research

Answer 16

• finds out what a customer needs or wants
• allows business predict how much demand there will be for its products , how much of product it will need to supply
• how consumers behave in relation to a product - in store, online
• how much consumers prepared to pay for the product
• ## identifying competitors

Question 17

quantitive

Answer 17

numerical statistics - facts and figures
questionnaires multiole choice
- quicker and easier

Question 18

qualitative

Answer 18

based on opinions of consumers
open questions
- more informative

Question 19

primary research

Answer 19

gathers new data first hand
- in number of ways: questionnaores, surveys, observations, interviews, focus groups
- test marketing
- sampling

Question 20

secondary data

Answer 20

using data that is already available
- government publications, reliable internet sources, market reports
- easier and faster and cheaper
- may be unsuitable
- out of date
- used to get initial understanding of market then business may do further primary market research

Question 21

avoid bias

Answer 21

• increase accuracy or market research
• questionnaires, surveys, interviews should avoid biased questions
• both interviewers and respondants can cause bias
• interviewer bias can be cuased by personality of interviewer
• respondants may give answers that arent true because they are unsure or just want to fit in

Question 22

technology in market research

Answer 22

• websites
• social networking- connect with customers through social media platforms, can post content and see the type of responses they get
• business databases- collect their own data to form a database about their products and consumers

Question 23

segmentation

Answer 23

dividing market into groups of buyers- consumers in each segment share one or more characteristic
market research helps firm to segment market by revealing more about types of consumers in the amrket

Question 24

different ways to segement the market

Answer 24

demographic- age, gender, socio economic class
geographic- according to city, country
income- high income customers, low income customers
behavioural- amount of use, lifestyle, hobbies and interests

Question 25

market mapping

Answer 25

shows extreme for 2 measures that are important to customers
laid out as a matrix, and products and barands positioned on it according to where they lie on each pair of extremes
- reveals gaps in the market
- can show a business who its closest competitors are
- show how much customers expect to pay
- can simplify things too much
- positions of products and brands on market map are usually based of opinion and may be biased

Question 26

competitive advantage

Answer 26

helps a business increase sales and profits

Question 27

how to achieve competitive advantage

Answer 27

• lower costs
• product innovation
• advertising and marketing
• product differentiation
• reliability and quality
• good customer service
• convenience

often gain advantage by adding value

Question 28

adding value

Answer 28

increasing the difference between the cost of making the product and the price that the customer pays, usually increases profits
ADDED VALUE= PRICE PRODUCT SOLD FOR - COST OF MAKING PRODUCT
added value can be achieved by either increasing the selling price of the product or by reducing the costs of making the product