section 1 - meeting customer needs

definition of the market

The market generally refers to all of the buyers and sellers that trade a particular type of product in a particular place

Definition of a mass market

a mass market is aimed at a larger group of buyers and the product has a wide range of appeal and useful to a variety of people

niche market definition

products in a niche market are aimed at t apscefic group of buyers as the product is some ida,used to meet osrticuksr needs

features of a mass market

• targeted to a wider range of people

• prices to be set lower

• large customer basis

• quality of goods would be lower

• targeting to more bulk purchasing

features of a niche market

• targets to a group of o people

• prices are to be set higher

• more competition

• lower sales volumes

• more costly to produce

market share definition which formula

This is the proportion of total market sales that a firm makes

Sales of one firm./ total market sales x 100

market size defintion with formula

This is the total value or volume of sales in the market . it can be measured in terms of money

Number of units sold x price

market growth and formula

the percentage u crease in the six’s of the market

change in the size of the market / original size x 100

Why do firms in a mass market need to make their brand distinctive

• branding creates a clear logo , name or statement that customers can easily recognise

• branding is important ss it can encourage customers to buy products

• in mass markets more businesses are selling similar products than in niche markets so there is more competition in mass markets which means these businesses should focus more heavily on branding

Dynamic market

a dynamic marker is a type of market which changes and evolves rapidly this is achieved by :

• consumer preferences

• in inflation

• competitors can enter or leave the market

• there can be changes in legistlans

online retailing

the process of buying and selling goods and services over the internet

• offers a greater convenience to the consumer

• can shop 24/7

• breaks down geographical barriers

• offers opportunities to the business

• lowers overhead costs

• access to the wider market

how competitions affect the market

• The price. a business can charge

• the buying power of the customer

• the selling power of the supplier

• available of substitutes

• willingness and ability if the inevitability

rusk and uncertainty

- All business activity comes with an element of risk as there is always a chance that everything can go wrong chance

• Risk refers to situations where the probabilities of possible outcomes are known ( can be measured)

• uUncertaintyrefers to situations where the randomness of outcomes cannot be expressed in terms of specific probabilities (can not be measured )

what is product orientation

• An oriented firm’s primary focus on its product and on the skills, knowledge, and systems that support that produce

this can lead the business towards the following approaches

• the hard sell - employing a large workforce to go out and convince customers that they should buy your product. Individualised sales targets, low basic salaries and high rates of commission ensure that sales staff will be incentivised to hit their target

• cutting costs and price - if product-oriented firms’ products are not selling well ,managers tend to respond by cutting costs

market orientation

• In a market-oriented business, managers take into account the needs of the consumer before making any decision

• They put the consumer at the heart of the decision-making process

• informed by market research

why do businesses need effective market research

• finds out the customer’s wants and needs

• allows a business to predict how much demand there will be for their product

• learn more about how consumers behave, how much the consumers would be bepreparedd to pay

• may help gain better insight into an aspect of the business environment

definition of quantitive and qualitative data

• quantitive research produces numerical statistics and closed questionsQuantitative

• Qualitative research is based on opinions; therfore are open questions

primary research

Primary research is where businesses gather new data

• can be gathered through

  • questionnaires

  • surverys

  • interviews

• limitations and drawbacks

  • time consuming

  • costly

  • doesn’t include the full market

  • specific to your needs

Secondary research

Secondary market research involves using data that already exists

• info from gov publication

• reliable internet sources

limitations and drawbacks

• easier

• faster

• cheaper

• may be outdated or have errors

• only used to get an initial understanding

what can help with gathering market research

• technology

• social networking

• business database

market segementation

• means dividing a market into groups

• Each segment of consumers has different wants and needs, so it requires a different marketing mix

3 different ways a market can segment

• demographic segment

  • age

  • gender

  • socio-economic class

• geographical

  • neighbourhood, city country,c ounty

  • customers have a range of cultures, lifestyles and cclimate

• income segment

  • customers with high or low income

• behavioural segment

  • amount of use

  • lifestyle

  • hobbies and interests

what is market mapping

• shows extreme values for two measures that are important to customers

• laid out as a matrix

how can business benefit from market mapping

• can reveal gaps in the market

• Find out if there are certain demands

• can show how much a customer expects to payHelpp with pricing strategy

drawback of markey mapping

• can be too simplistic

• Market maps are uusuallya matter of opinion

how can a competitive advantage help a business increase sales and profit

• lower costs - lower price = more sales

• product innovation - first = unique

• Advertising and marketing - make it attractive

• product differentiation - differs from others

• reliability and quantity

• Good customer service