BUSINESS UNIT 1.1.1 THE MARKET

What is a market?

A place (physical or online) where buyers and sellers exchange goods or services.

Difference between market size and market share?

• Market size: Total sales in a market.

• Market share: % of total sales a business holds.

What does it mean when a market is “dynamic”?

It constantly changes due to trends, consumer behaviour, technology, and competition.

What factors cause markets to change?

Innovation, new competitors, changes in consumer income, economic conditions, social trends.

How do businesses adapt to market change?

New products, flexible pricing, online presence, promotions, improving quality.

What is market research?

The process of collecting information about customers, competitors, and market trends.

Difference between primary and secondary research?

• Primary: Collected first-hand (surveys, interviews)

• Secondary: Existing data (reports, websites)

Difference between qualitative and quantitative research?

• Qualitative: Opinions, feelings, motives

• Quantitative: Numerical data, statistics

What are the key limitations of market research?

Bias, small samples, outdated data, cost, time-consuming, inaccurate predictions.

What is market positioning?

How a product is perceived relative to competitors — shown on a positioning/perceptual map.

What is competitive advantage?

A feature that allows a business to outperform rivals (price, quality, brand, innovation).

What does “adding value” mean?

Increasing the worth of a product by improving it (branding, quality, convenience, features).