1.1 Meeting Customer Needs Flashcards

Question

What is a legislation?

Answer 1

A law passed by Parliament

Answer 2

The adaptation or improvement of existing products e.g. improved cameras on laptops

Answer 3

The adaptation or improvement of existing processes e.g. just in time stock control

Answer 4

The measurement of the change in the entire market, expressed as a percentage of the original size NOTE: the businesses market share does not necessarily increase automatically as the entire market continues to grow.

Answer 5

- increasing population sizes - increasing incomes - changing tastes and preferences e.g. growth in the electric car market

Answer 6

- create flexible business structures, especially in terms of operations and people management - meet customer needs by carrying out market research and communicating with customers - invest in staff training, new products and processes - innovate so as to gain the first mover advantage (a competitive advantage gained by being the first business to introduce a new product/service to the market.

Answer 7

When the business is targeting customers with the same product as a competitor.

Answer 8

When firms sell different products but compete with each other for customers disposable income e.g. cinema and theatre companies

Answer 9

- businesses offer lower prices - businesses produce better quality products - businesses provide better customer service However, the absence of competition reduces incentives for businesses to innovate, be efficient or offer consumers lower prices

Answer 10

The potential threat to a businesses success Risks can be from inside the business (internal) or from outside the business (external) Risks can be measured and prepared for using risk management (the process of identifying, assessing and preparing for potential threats to business success)

Answer 11

When outcomes are difficult to predict

Answer 12

- technical failures due to break down of essential equipment - cyber security threats Loss of key staff Currency fluctuations for firms trading internationally

Answer 13

- Businesses continue to ace uncertainty after Britain’s exit from the European Union - will the economy go into recession? - will energy prices continue to rise? What will happen to interest rates>

Answer 14

An approach often used by inventors who research, test ad produce a product well before market research has taken place

Answer 15

An approach to marketing that focuses on the NEEDS OF CONSUMERS and uses this info to design products that meet customer needs. - consumers are at the centre of marketing decisions - products will be developed which respond to consumer needs

Answer 16

Overtime the business may move further and further away from what the market is looking for, thus increasing the risk of business failure. E.g. Gillette’s razors can be classified as a product-orientated business as the business focuses on the quality of its products and regular innovations aiming to increase sales.

Answer 17

The firm will benefit from increased demand, and therefore increased profits. They will also obtain a valued brand image as its products become more desirable E.g. unis often develop new courses based on the feedback they relieve from students and employers.

Answer 18

- product research - product testing - products focus

Answer 19

- market research - market testing - customer focus

Answer 20

The objective collection, compilation and analysis of information about a market

Answer 21

- to reduce risk when launching new products or entering new markets - anticipate future needs and wants of consumers - to understand consumer behaviour - to identify potential consumer demand - to identify how much consumers are prepared to pay - to identify competitors and estimate their potential strengths and weaknesses

Answer 22

Numerical data

Answer 23

Data based on thoughts and opinions

Answer 24

The process of gathering information directly from consumers in the target market using field research methods such as surveys, interviews etc (Gathers information that is new and does not necessarily exist in any format)

Answer 25

- surveys: Where you ask a series of questions to a certain number of people (respondents). The results from the ‘sample’ are used to make a conclusion in which the results of the sample are extrapolated (extended) to be true for the wider population A wide range of respondents can be reached using online survey tools such as surveys monkey

Answer 26

This involves hiring someone to stand in an appropriate location and study consumer behaviour in a store or perhaps judge the potential consumer traffic at a particular location. Researchers may observe the impact of packaging on consumer choice, or the impact that the particular placement of a product in a store may have on consumer choice.

Answer 27

Questions may be set up in a very similar way to a survey, however, an interviewer asks the questions This methods TAKES LONGER but does allow the interviewee to ask follow-up questions and gather the information that can easily be missed when conducting surveys

Answer 28

Free samples are provided for a limited period to the target market to determine their response to the product

Answer 29

Free range discussions, led by a marketing specialist, detailed feedback is collected from the target market. Usually limited to a small group of 12-15 people The group typically meets for 90 minutes to 3 hours

Answer 30

Information gathering is focused on the needs of the business and will not be available to its rivals The business can get in-depth information from respondents, for example, reasons behind certain behaviour Primary market research is more up-to-date and can be used to ask specific questions, so will be more relevant and specific to the business.

Answer 31

The sample size may be too small and unrepresentative of all of the customers leading to unreliable results Bias may mean that researchers can guide respondents to answer questions in a particular way. Similarly, respondents may be influenced by the responses of others, or not provide accurate information A business may need to hire a specialist market research agency to help and the process can be expensive and time-consuming

Answer 32

The collection, compilation and analysis of data that already exists Typical methods include purchasing market reports from specialist companies or accessing government statistical portals which provide useful information

Answer 33

Information is already available and so is quicker to collect than primary research, thereby saving time Information is often free (e.g. government websites and internet sources such as Statista) and is cheaper to collect, leading to lower costs compared to primary research Suitable for a small business that lacks a large marketing budget and/or expertise

Answer 34

Information has been collected for other purposes and so may lack relevance or may not be factually correct, e.g. Wikipedia Can be expensive to purchase market specific secondary data from specialist companies, e.g. MINTEL reports Information may be out-of-date, especially in dynamic markets Information will not be specific (tailored) for the business.

Answer 35

- Company websites Websites allow businesses to collect primary data cheaply e.g. tracking consumer searches and analysing customer receives, as well as collect secondary data about revivals e.g. prices and special offers - databases Can be used to store large amounts of customer information e..g Tesco loyalty cards. Databases are also effective in collecting customer e-mail addresses so targeted customers can be surveyed later via e-mail - social networking Focuses on gathering information about consumers via online social channels such as twitter and facebook It is also useful as a method of running quick polls and surveys or tracking opinions about brands

Answer 36

The process in which a single market is divided into ‘segments’ Each segment represents a slightly different set of consumer characteristics Firms often segment their market according to factors such as income, geographical location, religion, gender, or lifestyle E.g. the crisp market is divided into many market segments such as - dinner party snacks (walkers, sensations or Pringles) - health conscious crisps (walkers lite) - lunch box value snacks (multipacks, hoola hoops)

Answer 37

Recognises that consumers are not all identical Consumer groups do not all share the same tastes and preferences. Products and marketing activities can be altered to meet different needs of different groups of consumers and targeted more precisely Less expensive and wasteful than marketing products at wide market segments May increase loyalty if the consumer feels that their needs are being met, which can lead to repeat purchases

Answer 38

Not everyone within a segment will behave in the same way It may be difficult to identify a segment and consumers can belong to multiple segments at the same time Segmentation requires more detailed market research, which can prove costly - but beneficial - to the business A segment may be identified but it may be too small and unprofitable to cater for

Answer 39

Where the business decides where they want to position their prod out in the market with regard to price, quality, branding, and customer perception

Answer 40

Market mapping is a tool for identifying the position of a product within a market A market map is a two-dimensional diagram that shows the attributes of characteristics of a product in comparison to rivals’ products. Only 2 criteria can be chosen e.g. price and quality or age and income, etc.

Answer 41

The market is saturated, meaning there are no opportunities to exploit a gap in the market. Competition is likely to be high and profits low.

Answer 42

May indicate the existence of a gap in the market. This needs to be researched carefully before the business commits e.g. it looks like there is a gap in the market in the high price/ low quality area

Answer 43

Market gaps can be identified which may enable a business to come up with ideas for new products Comparisons can be made between a business’ products and those of its rivals - where are the business’ products positioned about its rivals? Market maps are simple to construct and offer a visual illustration of the position of a product in the market

Answer 44

A gap in the market may exist because it is not profitable to fill Mapping a market may require primary research which can be expensive Only two criteria can be chosen which may prove too simplistic Markets are often dynamic and a market map only provides insight at a specific point in time

Answer 45

The features of a business and its products that are perceived as superior to its rivals by customers It is how a firm’s product is made both distinctive and defensible. Distinctive means that it is different from the competitors Defensible means that the business can prevent competitors from copying it

Answer 46

- marketing and branding - functions and features - packaging - customisation - customer service - convenience - design - product differentiation

Answer 47

- innovation, reputation (branding) - building strong relationships with stakeholders - adding value (difference between price charged to customer + cost of inputs required) - differentiation - market segmentation - price leadership

Answer 48

Quality e.g. Audi is well known for the exceptional quality of the finishing inside their cars Delivery times e.g. Amazon Prime delivers products within 24 hours of ordering Low price e.g. primary is considered to provide the best value/low price combination Reliability e.g. Apple Macs have an excellent reputation for long life and reliability Design e.g. Dyson vacuum cleaners stand out from the crowd with their original design

Answer 49

An attempt by a business to distinguish its productss from those of competitors This involves creating functions or features of the product (or firm) which help it to stand out from its competitors. Strong product differentiation helps the firm develop its competitive advantage. The development of product differentiation often helps a firm to create a unique selling point for its product, which can be used in marketing Product differentiation may be tangible (clearly visible) or it may be a perception that is created about the product in the consumer's mind

1.1 Meeting Customer Needs Flashcards

(75 cards)