Paper 1

Question 1

What is a brand

Answer 1

A brand is used to differentiate, distinguish and create an image which can allow products in mass markets to charge a higher price

Question 2

What is a niche market

Answer 2

A niche market is a subset of the main market that focuses on specific customer wants and needs

Question 3

What is a mass market

Answer 3

A Mass market is where a business sells to the largest part of the market where there are many similar products of offer

Question 4

Characteristics of a mass market

Answer 4

One advert for product
High economies of scale 
Mass production 
Large customer base 
High competition
High turnover of raw materials to products

Question 5

Characteristics of a Niche market

Answer 5

Charge a premium price 
Specialised products 
Low economies of scale 
High wastage 
Not as many competitors 
Targeted advertising

Question 6

Market size

Answer 6

Value of the items sold and the volume of the products sold in the market

Question 7

Formula for market share

Answer 7

Sales of x business / sales of whole market x100

Question 8

Characteristics of online retail for consumers

Answer 8

Open 24/7
Global fashion- more availability
Alliente markets- harder to access elderly if they don’t trust online banking
Delivery costs

Question 9

Characteristics for online retail for a business

Answer 9

Save costs- lower overheads
Need technology skills
Gather customer data and info- direct marketing
Website crashing can be a huge financial loss

Question 10

How can markets change

Answer 10

Size- markets can grow or shrink
Nature- products or services provided-consumer perception trends
New- technology developments

Question 11

How can businesses adapt to change

Answer 11

Develop a niche
Continuous improvement and innovation
Investment- growth and expansion
Market research- what do consumers actually want

Question 12

How can competition affect consumers

Answer 12

Consumers can be exploited it there is low competition

Question 13

How can competiton affect a business

Answer 13

Saves costs
Need technology skills
Gather customer info- direct marketing
Website crashed- huge financial loss

Question 14

How markets can change

Answer 14

Size- markets can grow or shrink
Nature- product or service provided- consumer perception+trends
New- developments in technology

Question 15

How businesses can adapt to change

Answer 15

Develop a niche
Continuous improvement and innovation
Investment growth and expansion
Market research what do customers want

Question 16

lack of competition effects on consumers

Answer 16

Lack of competition means that they can charge a higher price meaning that they can be exploited

Question 17

Competition characteristics for a business

Answer 17

Under pressure to get customers can adapt as such
Lower prices, better quality, advertise, promote added value
Reduced potential profits
Make barriers into market

Question 18

Risk definition

Answer 18

An action taken by a business with an unknown outcome

Question 19

Uncertainty

Answer 19

External influences out of the control of the business

Question 20

Product orientation definition

Answer 20

Where a business develops products based on what it is good at making or doing, rather than what the customer wants

Question 21

Market orientation definition

Answer 21

Where a business focuses on what the consumer wants and needs and meets them

Question 22

Benefits of market orientation

Answer 22

Respond quick to change
anticipate change
respond quickly to change

Question 23

Primary research

Answer 23

research gathered and undertaken by a business directly

Question 24

Secondary research

Answer 24

involves a business using the research that someone else has gathered

Question 25

Qualitative data

Answer 25

data gathered that consists of attitudes, beliefs and opinions

Question 26

Quantitative data

Answer 26

data gathered that consists of statistics and measured data

Question 27

Market positioning

Answer 27

helps determine what customers believe is being offered to them

Question 28

Market mapping

Answer 28

using a graph to help plot competitors and their products to understand competitor behaviour and spot a gap in the market

Question 29

benefits of market segmentation

Answer 29

Meet specific needs
Increased revenue
Avoid wasting resources
gain loyalty

Question 30

FACTORS LEADING TO A CHANGE IN SUPPLY

Answer 30

• Changes in the cost of production
• Indirect taxes
• Government subsidies
• Introduction of new technology
• Weather
• Government
• World events
• Price of related goods

Question 31

Demand

Answer 31

is the amount of a product that consumers are willing and able to purchase at a given price

Question 32

Supply

Answer 32

; is the amount of a product which suppliers will offer to the market at a given price

Question 33

What is a surplus

Answer 33

Where supply exceeds demand

Question 34

What is a shortage

Answer 34

When demand exceeds supply