1.1.1 - The Market Flashcards
(31 cards)
Define the term market.
A market is any place (physical or digital) where buyers and sells can meet to exchange goods and services for cash.
What are the two types of markets.
- Niche Market
- Mass Market
What is a mass market?
A mass market is where products are aimed at broad market segments.
What is a niche market?
A niche market is a specialised section of the market where products are aimed at a small subset of consumers in a market.
What is meant by the term market share?
Market share is the proportion of the total market sales a business of brand controls.
What is the formula to calculate market share?
(Sales of the business ÷ Total sales of the market) x 100
What is a brand?
A brand is a name, image of logo that help one product stand out amongst its competitors.
What is the purpose of branding?
Branding is one of the key ways businesses achieve product or business differentiation.
What id the aim of marketing?
The aim of marketing is to help identify, anticipate and satisfy customer needs and wants profitably.
What is a dynamic market and why might it change?
A dynamic market is one that is subject to rapid or continuous change. It may change because of:
1. Customer tastes and preferences.
2. Changes in technology.
3. Impacts of new market entrants.
What are the advantages of targeting a niche?
- Less competition.
- Clear focus.
- Builds up specialist skill and knowledge.
- Can often charge a higher price.
- Profit margins often higher.
- Customers tend to be more loyal.
What are the disadvantages of targeting a niche?
- Less opportunity for economies of scale.
- Risk of over-dependence on a single product or market.
- Likely to attract competition if successful.
- Vulnerable to market changes (all eggs in one basket).
What is market growth?
An increase in demand/sales for a particular product/service
What is market size?
The total amount of sales/customers in a market measured by value/volume
What is sales volume?
The quantity of a good or service sold within a period of time.
How do you calculate sales volume?
Sales revenue / selling price
What is online retailing?
Selling goods and services on the internet.
What are the advantages to the business of online retailing?
- easier market access.
- reduced overheads compared to physical stores.
What are the disadvantages to the business of online retailing?
- high set up and infrastructure costs.
- increased competition.
What are the advantages to the customers of online retailing?
- increased choice.
- ease of shopping
What are the disadvantages to the customers of online retailing?
- concerns about privacy and security.
- returning unwanted or unsuitable products can be difficult.
What is competition?
Competitions is the rivalry between sellers trying to achieve goals such as increasing profits, market share, and sales volume.
What is a competitive market?
When there are many rivals in a market selling similar products.
How can competition affect a market?
- battle for market share.
- pricing : pricing wars are regular when there is lots of competitors.
- pressure to innovate.
- pressure to differentiate.
