1.1 Meeting Customer Needs

Flashcards for A Level Business Studies exam preparation.

What is a market?

Any place where buyers and sellers can meet (e.g., Amazon.co.uk or a shopping mall).

What is the aim of marketing?

To help identify, anticipate, and satisfy consumer needs and wants profitably.

What are needs?

Things considered essential (e.g., shelter or food).

What are wants?

Desires which are non-essential, even if consumers consider them essential (e.g., Nike trainers).

What is market research?

The process of gathering data from consumers which can be used to influence business decisions.

What are market segments?

Groups of consumers who share similar characteristics (e.g., age, lifestyle, etc.).

What is mass marketing?

When businesses sell their products to most of the available market.

What is niche marketing?

When businesses identify and satisfy the demands of a specific group of consumers within the wider market.

What is sales volume?

The number of products sold (i.e., the physical number of units sold).

What is sales revenue?

Price x quantity sold (i.e., the financial value of the units sold).

How is Market Share Calculated?

(Sales of a business / Total sales in the market) x 100

What is a brand?

A name, image, or logo which helps one product or service stand out from its competitors.

What is adding value?

The process by which firms increase the price that the consumer is willing to pay.

What is a dynamic market?

A market that is subject to rapid or continuous changes.

What is online retailing?

Selling products via the internet.

What is product innovation?

The adaptation or improvement of existing products (e.g., improved video cameras on laptops).

What is process innovation?

The adaptation or improvement of existing processes (e.g., just in time stock control).

What is market growth?

The measurement of the change in the entire market, expressed as a percentage of the original size.

What is direct competition?

Occurs when the business is targeting customers with the same product as a competitor.

What is indirect competition?

Occurs when firms sell different products but compete with each other for the customers disposable income (e.g., cinema and theatre companies).

What is risk?

The potential threat to business success; can be internal or external, measured and prepared for using risk management.

What is uncertainty?

When outcomes are difficult to predict.

What is product orientation?

An approach to marketing that focuses on the characteristics of the product rather than the needs of the consumer.

What is market orientation?

An approach to marketing that focuses on the needs of consumers and uses this information to design products that meet customer needs.

What is primary research?

The process of gathering information directly from consumers in the target market using field research methods such as surveys, interviews, etc.

What is secondary research?

The collection, compilation, and analysis of data that already exists (e.g., market reports, government statistics).

What is market segmentation?

The process in which a single market is divided into submarkets, or 'segments,' each representing a slightly different set of consumer characteristics.

What is market positioning?

The process a business goes through when launching a new product or service, deciding where to position the product in the market with regard to price, quality, branding, and customer perception.

What is market mapping?

A tool for identifying the position of a product within a market; a two-dimensional diagram that shows the attributes or characteristics of a product in comparison to rivals’ products.

What is competitive advantage?

The features of a business and its products that are perceived as superior to its rivals by customers.

What is product differentiation?

An attempt by a business to distinguish its products from those of competitors, creating features or functions that help it to stand out.

What is adding value?

The difference between the price that is charged to the customer and the cost of inputs required to create the product or service.