4.1 Flashcards
(19 cards)
Define marketing
The processes involved in identifying and satisfying customer needs
Define market
any place where buyers and sellers come together to exchange goods
What is product orientation?
A situation where a business prioritizes research and development of high quality products rather than prioritizing market research
What is a patent?
the legal right to be the only producer and seller of a good for a period of time
What are the advantages of product orientation?
Unique selling point
Lack of competition
What are the disadvantages of product orientation?
High risk
High cost
What is market orientation?
prioritizing the market; the sole focus of a business is on the needs and wants of the customers
What is USP?
Unique-selling point; a feature of the product that distinguishes it from competitors
What are advantages of market orientation?
Low risk
Repeated customers
What are the disadvantages of market orientation?
No USP
Businesses must be responsive to changing market conditions
What is market share?
the value of a single company’s sales compared with the sales of all businesses in a market
What is market growth?
increase in sales revenue in an individual market over time
What is a market leader?
product/brand with the highest market share
What are distribution channels?
the network used to move a product from the manufacturer to the end users
What are the advantages of market leadership for a business?
Brand recognition
Economies of scale
Price leadership
What are the disadvantages of market leadership for a business?
Difficult to stay market leader
Market leaders lack incentive to innovate
What are the disadvantages of market leadership on economy, society, and the environment?
finding tax loopholes to avoid tax as the dominant business
What are advantages of market leadership on customers?
Networks: businesses can create network effects
Price: economies of scale; lower prices for customers
Innovation: High profits means more investment into research and development for customers
What are the disadvantages of market leadership on customers?
Networks: businesses may abuse their power in networks; invade privacy
Price: businesses may take their high profits and not lower prices
Innovation: businesses may have little incentive to innovate
