Business revision assessment 1.2

Question 1

What are the four customer needs?

Answer 1

Price, quality, choice and convenience.

Question 2

Why is customer needs important in the sector of generating sales?

Answer 2

1. Find who customers are.
2. What they want.
3. This leads to customers buying the good/service.
4. Allows business to generate sales and cash flowing into the business.

Question 3

Why is customer needs important in the sector of business survival?

Answer 3

1. Businesses must sell enough to cover its costs.
2. Able to pay bills
3. If inflow exceeds outflow the business is likely to survive.

Question 4

Why is customer needs important in general?

Answer 4

1. Customers give money to the business in exchange for a product or service.
2. The business relies on their customers for their income which is needed to pay their bills.

Question 5

What is market reasearch?

Answer 5

The action of gathering information about the market and customer needs and wants in order to make business decisions.

Question 6

What are the four purposes of market reasearch?

Answer 6

1. Understanding customer needs.
2. Identify potential gaps in the market.
3. Reduces the risk of starting a business.
4. Allows the business to conduct informed decision making.

Question 7

What is primary market reasearch?

Answer 7

Research carried out by the business specifically for the needs and the purposes the business had in mind.

Question 8

Why is primary research important?

Answer 8

1. New information can be learned from it.
2. Understand the customer views and needs.
3. Reduces the risk of starting a business.
4. Being able to offer a product or service.

Question 9

How is the method of survey done to conduct primary research?

Answer 9

1. Method: survey
2. Explanation: a simple set of questions completed by the public.
3. Advantages: cheap and easy.
4. Disadvantages: cannot guarantee right people completing it and do depth of data to analyse.

Question 10

How to conduct a questionnaire for primary market research.

Answer 10

1. Method: questionnaire
2. Explanation: set of closed and open questions.
3. advantages: more in depth data and good quality information.
4. disadvantages: time consuming, expensive, and biased(could be misleading results. )

Question 11

How to conduct a focus group for primary market research?

Answer 11

1. Method: focus group.
2. Explanation: a small group of people discuss a product.
3. Advantages: good quality information and deeper research data gathered.
4. Disadvantages: time consuming and expensive.

Question 12

How to conduct a observation for primary market research?

Answer 12

1. Method: observation
2. Explanation: watching customers go and what they buy.(watching rival shops or an area.)
3. Advantages: can show natural buying habits and totally objective.
4. Disadvantages: time consuming, must select most appropriate area and have a clear outcome.

Question 13

What is secondary market research?

Answer 13

Research that is manipulated to try and fit a wholly different intention by a completely different business.

Question 14

What are the advantages of secondary market research?

Answer 14

Convenient can be done anywhere.

Question 15

How to use market reports for secondary market research?

Answer 15

1. Method: market reports.
2. Explanation: using industry research done previously to monitor trends written by experts.
3. Advantages: good quality information and often highly detailed.
4. Disadvantages: expensive and can be out of date.

Question 16

How to use a government report for secondary market research.

Answer 16

1. Method: government report
2. Explanation: government produces data regards age, income unemployment. Can be used by the business.
3. Advantages: lots of information and can save time.
4. Disadvantages: might not show what we want and can be out of date.

Question 17

How can we use the internet for secondary market research?

Answer 17

1. Method: Internet.
2. Explanation: using internet to gain information.
3. Advantages: cheap, easy and lots of information.
4. Disadvantages: can be inaccurate, out of date and it is available to competitors.

Question 18

What is quantitative data?

Answer 18

1.Its numerical, statistics, percentages
2. To be reliable must obtain a large amount.
3. Often gathered using a questionnaire
4. Compared easily over time.

Question 19

What is qualitative data?

Answer 19

1. Cannot be measured by numbers.
2. Its opinions/reasons why.
3. Uses open questions.
4. Takes a lot longer to gather data.
5. Often gathered by a focus group or a face to face interview.

Question 20

How can a business use qualitative data?

Answer 20

1. Check if the product/ service is well liked.
2. Discuss design or packaging
3. If advertising is clear and persuasive
4. Understand the consequences of changes in pricing.

Question 21

What is the role of social media in business?

Answer 21

Market research can be very expensive. Using social media can be a much cheaper way to gather large amounts of data.

Question 22

What are the benefits of using social media?

Answer 22

1. Deeper understanding of the market.
2. Identify popular trends.
3. Improve products/services.
4. Understand the competition.

Question 23

Why is the reliability of market research data important?

Answer 23

Because businesses use market research data to make business decisions.

Question 24

What is validity and reliability of data?

Answer 24

1. Validity: trusted? or bias free?
2. Reliability: accurate?

Question 25

What is market segmentations?

Answer 25

The process of dividing a market into different groups. Each segment includes customers that have similar buying habits.

Question 26

What are ways we can segment the market?

Answer 26

Age, income, religion, interests and geography.

Question 27

Why do we segment the market?

Answer 27

Effectively target the product/service to the right people. 2. The business saves money by selling goods and services that are needed by their specific target market. 3. Businesses can differentiate its products to suit a number of market segments. 4. Offers something that no other business can offer. (U.S.P)