Markets

Vocabulary flashcards covering basic market and competition concepts based on lecture notes.

Market

A place where buyers and sellers come together to exchange goods and services.

Competition

When rivalry exists between business in the same industry.

Competitive Market

When there are a large number of buyers and sellers in the market.

Market Segmentation

Identifying and targeting groups of people with similar needs and wants and developing products or services for each of them

3 main types of market segmentation

Demographic, Psychographic, Geographic

Demographic market segmentation

Age, social class, gender. Example: Banks offering different accounts to age groups

Psychographic market segmentation

Personality, opinions, lifestyles.

Geographic market segmentation

Rural, suburban, global marketing. Example: food products having different ingredients in different countries

Decide a suitable segment

1. Must be Recognisable - differs from other segments

2. Must have Critical mass - Big enough/ produce enough sales to make the targeting worthwhile

3. Must be Targetable - Can be promoted to

Advantages of market segmentation for consumer

Easier to find, more specific to their needs, variety, fit budgets, aligned with principles

Disadvantages of market segmentation for consumer

Higher prices, excluded from some businesses if needs are not recognised

Advantages of market segmentation for business

Charge higher prices, reach a wider range of customers, awareness in that target group, less wasteful advertising

Disadvantages of market segmentation for business

Limiting, money for lots of market research, more stock and storage required