Topic 1.2 - Spotting a Business Opportunity Flashcards
(41 cards)
What are the main customer needs a buisness must consider?
- Price
- Quality
- Choice
- Convenience
How can customers be influenced by price?
Lowering prices will increase sales
Why do customers want a choice?
- Different customers have different tastes and needs
- It can help customers with buying decisions
Why is it important for a business to meet customer needs?
- It can help create customer loyalty
- Increases sales
- Business could fail if they don’t meet their needs
What needs and behaviours do customers base their buying decisions on?
- Family Needs
- Financial needs
- Emotional needs
- Brand loyalty
What is market research?
Process of gathering information about the market and customer needs and wants
What is the purpose of market research?
- To identify and understand customer needs
- To identify gaps in the market
- To reduce risks
What does it mean for a buisness idea to be viable?
Able to work properly or successfully
What is stratified sampling?
Probability sampling technique where the researcher divides the entire population into different subgroups
What is systematic sampling?
Probability of sampling methods in which researchers select members of the population at regular intervals
What is primary research?
Research carried out to answer specific questions and issues
What are questionnaires? + What can they be used for?
- They are a set of questions with a choice of answers
- Type of primary research
- Provide feedback on information a business needs to obtain from its customers
What factors do businesses have to consider when identifying the type of customer they would like to question?
- Age group
- Income bracket or social group
- Home town or region
- Gender
What are focus groups?
- A group of people who discuss their views on a product/service/advertisement
- Usually 10 people
- Participants should not know each other (usually paid)
- Can be held online
What are observations and how can it be carried out?
- Means watching how customers behave naturally when they don’t think they are being watched
- Can be seen through CCTV
- Helps to understand people’s reactions to new products etc.
What are the advantages of using observations?
- Customer behaves naturally
- Research is not biased
What are the disadvantages of observations?
- Time consuming
- Does not provide a definite answer
- Must be carried out in an ethical manner (consent etc.)
What is secondary research?
Using existing resources of information that has been previously researched
What is the difference between internally sourced information and external sourced information?
Internally sourced info is the data, statistics and research that a business has accumulated in the past. Externally sourced info is info published by people or organisations that are not related to buisness
What are some examples of externally sourced information?
- Government agencies
- Newspapers
- Trade unions
What is a trade association?
An organisation founded and funded by business that operate in a specific industry
Advantages of primary research
- Tailored to the product
- Research is unique to the business carrying it out
Disadvantages of primary research?
- If survey is badly designed it may not give the results the business is looking for
- Can be very expensive
- Time consuming
Advantages of secondary research
- Quicker to obtain information
- Less expensive
