Business 1.2

Customer Needs

The things customers need satisfying when they buy products or services.

Price

How much customers are willing to pay for a product or service. It will influence their decision to purchase or not and help determine image.

Quality

Described as 'fitness for purpose' and will influence image.

Choice

The variety on offer eg Caffe Nero

Convenience

Something that saves time or makes things easier eg ready meals

Gap in the Market

Occurs when no business is serving particular needs in the market.

Primary Research

Information that has been gathered for a specific purpose

Secondary Research

Information that already exists such as Government reports

Quantitative Research

Data that can be expressed as numbers and can be mathematically analysed.

Qualitative Research

Data about opinions

Survey

Where businesses find out what their customers think about new or current products and services. (Primary).

Questionnaire

A list of questions to be answered

Focus Groups

A group of people who discuss their views on a product

Observation

Watching how customers behave in a certain environment eg walking round Ikea. (Primary).

Internet Research

Research that has already been collected and is placed on the web for others to use. You need to consider cost and the date conducted. (Secondary).

Market Reports

Businesses such as Mintel who collect information about market trends and sell them on. (Secondary).

Government Reports

Information collected by the government concerning national statistics eg unemployment predictions

Bias

Unbalanced ideas where people are encouraged to agree with a certain idea rather than presenting the evidence fairly

Reliability

It is the degree to which research can be trusted. E.g. Is the source reliable?

Market Segments

Part of the market that has similar buying habits. This could be age

Target Market

A particular groups of consumers that a business aims its products and services at

Demographics

Information relating to the population such as average age

Market Map

A diagram that shows the range of possible positions in the market

Direct Competition

Other businesses that sell the same product or services as you do eg McDonalds and Burger King

Indirect Competition

Businesses that don't sell the same product or service but still compete with you eg McDonalds and Starbucks

market research

The activity of gathering information about consumers' needs and preferences.