1.1.3 market positioning Flashcards
product differentiation definition
an attempt by a business to distinguish its product from those of competitors
unique selling point definition
the aspect or feature of a product that clearly distinguishes it from its rivals
benefits of product differentiation
- able to charge higher prices
- brand recognition-different from competitors- your brand stands out
- higher market share- makes brand stand out more
drawbacks of product differentiation
- doesn’t guarantee that customers will buy your product
- advertising would cost more money- higher costs- limits profits
- customers not willing to buy at such a high price
competitive advantage definition
the conditions or circumstances that put a business in a favourable or superior position compared with its rivals
ways to achieve a competitive advantage
- lower costs
- design e.g. store layout, aesthetic
- product range e.g. broad, investing in new stock
- product quality e.g. durability-raw materials
- advertising and marketing e.g. endorsement
- customer service e.g. delivery, refunds
- ethical stance e.g. fair trade, recycling raw materials
market map definition
a diagram that identifies all the products or brands in the market using two key features e.g. price and quality
advantages of market mapping
- identify gaps in the market
- easy and quick to do
- very cost effective
- good visual illustration of the market
disadvantages of market mapping
- opinion based
- can be too simplistic e.g. no unit of variables
- only going off two variables
market positioning definition
-refers to how a customer views an individual brand relative to other brands
added value definition
the difference or perceived customer difference between the selling price and the cost of bought-in goods and services
examples of adding value to products include
- better design/features
- branding
- packaging
- good customer service
- guarantees
- frequent buyer offers
- speed of service and response tomes to customers
why do businesses add value?
-to gain a profit. high quality- attract more customers to the business
