BUSINESS IGCSE EDEXCEL UNIT 4 FLASHCARDS

market research

market research

collection, presentation and analysis of information relating to the marketing and consumption of goods and services

reasons for market research

1. to identify customer needs

2. to identify gaps in the market

3. to reduce risk

4. to inform business decisions

untapped

supply, market or talent that is available but has not yet been exploited

primary research

gathering of new information that does not exist

methods of primary research

1. questionnaires

2. focus groups/consumer panels

3. observation

4. test marketing

consumer panels

groups of customers asked for feedback about products over a set period

secondary research

collection of data that already exists

methods of secondary research

1. media

2. competitors

3. internal data

4. publications

5. business websites

quantitative data

information that can be quantified that is expressed in numbers

qualitative data

information about attitudes, beliefs and intentions usually expressed in words

advantages of social media

1. broad reach

2. ability to target

3. cheap

4. personal

5. fast

6. easy

market

set of arrangements that allows buyers and sellers to communicate and trade in goods and services

marketing

identifying customer needs and satisfying them profitably

methods of customer loyalty

1. reward cards

2. free gifts

3. charitable donations

4. partnership deals

product oriented

business focuses on the design and manufacture of the product itself rather than the needs of the customers

market oriented

business focuses on the needs of consumers when developing products

market share

proportion of sales in a total market that a business or product enjoys

market analysis

quantitative and qualitative assessment of a market

mass market

very large markets where products with mass appeal are marketed

niche market

smaller market usually within a large market or industry

changes in the market

1. changing customer needs

2. changing customer spending patterns

3. increased competition

market segments

part of a whole market where a particular customer group has similar characteristics

methods of market segmentation

1. demographic

2. geographic

3. psychographic

socio-economic groups

division of people according to social class based on employment status

advantages of market segmentation

1. increase in revenue

2. customer loyalty

3. minimise waste of promotional resources

4. wider range of products

marketing mix

elements of a firm’s marketing that are designed to meet the needs of customers

stages of product development

1. generating ideas

2. analysis

3. development

4. test marketing

5. commercialisation and launch

product life cycle

level of sales at the different stages through which a product passes over time

stages of product life cycle

1. development

2. introduction

3. growth

4. maturity and saturation

5. decline

extension strategies

methods used to lengthen the life of a product

product portfolio

range of products a business is currently marketing

boston matrix

2×2 matrix that describes products according to the market share they enjoy and whether the market has potential for growth

star

high market share high market growth

cash cow

high market share low market growth

question mark

low market share high market growth

dog

low market share low market growth

factors that affect price

1. costs

2. marketing mic

3. objectives

4. taxes

5. competition

cost plus pricing

adding a markup to the costs of producing a product to get a price

mark up

percentage added to costs that makes a profit for the business

penetration pricing

setting a low price initially and increasing it once established

competition based pricing

pricing strategies based on the prices charged by rivals

destroyer pricing

setting a low price until rivals has gone out of business

skimming

setting a high price initially then lowering it

loss leader

product sold below cost to draw in customers

promotional pricing

1. discounts and sales

2. psychological pricing

3. loss leaders

distribution channel

route taken by a product from the producer to customer

intermediary

person or organisation that helps to arrange agreements or business deals between other people and organisations

wholesalers

persons or businesses that buy goods from manufacturers and sell them in smaller quantities to retailers

retailers

businesses that buy goods from manufacturers and wholesalers and sell them in smaller quantities to consumers

bulk breaking

dividing a large quantity of goods received from a supplier before selling them on in smaller quantities to customers

e-commerce

use of electronic systems to sell goods and services

benefits of e-commerce to consumers

1. cheaper

2. 24/7

3. wide range

4. can shop from anywhere

benefits of e-commerce to businesses

1. lower start up costs

2. 24/7

3. less paper

4. wider market

direct selling

business sells directly to consumers

above the line promotion

placing adverts using media

below the line promotion

any promotion that does not involve media

merchandising

the way in which goods are arranged and placed in a store

advertising

communication between a business and its customers where messages are places in the media to encourage the purchase of products

advantages of above the line promotion

1. huge audiences can be reached

2. opportunity to target

3. great impact

4. sound and movement

disadvantages of above the line promotion

1. expensive

2. short lived message

3. delay

4. rivals’ products advertised as well

public relations

attempt by a business to communicate with interested parties

exposure

advertising and publicity that is used to sell a product or service

brand

having a unique name/logo/identity

branding

a name/symbol/design that identifies and differentiates a product from other products