markets Flashcards
(31 cards)
what is a market
different businesses can operate in different markets
what is a local market?
this is where the buyers (customers) may be a short distance from the sellers (business). These are common for the sale of fresh and locally sourced products and local services such as hairdressers. The local high street or retail park is a good example of products being supplied to customers who live nearby.
what is a national market?
a market where customers are spread throughout the country or over a large area. The same product is provided to customers who are spread throughout the country. Examples include national chain businesses such as supermarkets or fast food restaurants that will have stores in 100s of locations across the UK.
what is a global market?
a market where goods and services of one country are traded (purchased or sold) to people of other countries. Examples include car manufacturers such as Ford (originating in the USA) or Toyota (originating in Japan), both of whom manufacture and sell cars in many countries across the world.
what is a consumer market?
a market for products and services bought by individuals for personal or family use. Goods that are bought in consumer markets can be categorised as fast-moving consumer goods, consumer durable goods and services.
what is a trade market?
a market that involves the sale of goods and services between businesses. Often referred to as ‘Business to Business’ marketing (B2B). For example, a business that sells raw materials or components such as coal or steel to other businesses. Another example may be a business that offers financial and accounting services to other businesses
what is a seasonal market?
a market where businesses will experience seasonal variations in output and/or sales. For example, businesses who manufacture and sell fireworks with the majority of sales revenue coming in the months of October, November and December. Another example would be businesses that sell ice cream, particularly through retail outlets/ice cream kiosks.
what is a mass market?
a mass market is a market that targets a wider audience
what is a niche market?
a niche market is a market that appeals to a small audience
what is market size?
this is information about the total amount of goods sold in a particular market or the total amount of sales revenue that a particular market generates. For example, the grocery market (which includes supermarkets) was worth £192 billion in 2019.
what is market share?
this is the proportion of total sales in a market made by one business. It is calculated using the following formula:
why is high market share important to a business?
1.helps a business to meet business objectives, e.g. survival, growth, 2.profit maximisation, increased market share
3.increases a business’ overall profitability (there is a link between market share and profitability)
4.helps a business to benefit from economies of scale
5.can lead to competitive advantage
6.can help attract new shareholders.
what is equation for market share?
number of products sold/total market sales *100
what is a market trend?
these are changes and developments in the buying and selling of products and services in a market.
how do business split up the market?
demographics,
geographical location
psychographic
lifestyle, and culture
ethnic origin/religion.
how do businesses split up markets with demographics?
gender
age
socio economic/social class
how do businesses split up marks with geographical location?
regions of the country
what is splitting the market with psychographics
target people based on their personality
importance of segmentation to a business and its customers
a business can have a target market therefore they can produce goods that are a customer need/want in order to break even and meet the demand. They can advertise to appeal to the target audience
what is monopolistic competition?
Monopolistic competition is a market structure where elements of monopoly allow businesses or consumers to exercise some control over market prices.
what is an oligopoly?
An oligopoly exists when there are many businesses operating in a marketplace but only a few large businesses dominate the market. Many of the United Kingdom’s largest industries are oligopolistic in nature. For example, in retailing, the grocery market is dominated by Tesco, Sainsbury’s, Morrisons and Asda.
what is an advantage of an oligopoly?
benefit from economies of scale
what is a disadvantage of an oligopoly?
expensive start up costs
what is a monopoly?
A monopoly exists when there is a single producer within a market (one business has 100% of the market). This is known as a pure monopoly. For example, British Gas and British Telecom (BT) used to be pure monopolies. Until recently the Royal Mail had a monopoly over the delivery of letters in the UK, but even this has now opened up to competition.
