Business topic 1: The dynamic nature of business

Why do businesses exist?

To meet a specific need or fill a gap in the market by selling goods, services, or both.

Why might an entrepreneur start a business?

Because there is a demand for the goods or services they can provide.

What is a dynamic market?

A market in a rapidly changing business environment.

Why must a new business understand the market it is entering?

Because different markets change at different rates, affecting how the business operates

How do businesses stay competitive in a dynamic market?

By adapting and developing new ideas, products, and services to keep up with technology and trends.

What are the main ways business ideas can come about?

• Changes in consumer wants

• Products/services becoming obsolete

• New and original ideas

• Adapting existing products, services, and ideas

What is e-commerce?

Any business transaction that takes place using the internet.

What are the types of e-commerce?

• B2B: Businesses selling to other businesses

• B2C: Businesses selling to consumers

• C2C: Consumers selling to other consumers (e.g., online auctions or shopping sites)

How has e-commerce helped businesses?

It allows businesses to sell to more customers and in different countries.

What is m-commerce?

Any business transaction via a mobile device (phone or tablet).

How do businesses use m-commerce?

• Allowing website access via mobile

• In shops, allowing payment via smartphone

How do businesses use social media?

• Create brand awareness cheaply and effectively

• Obtain feedback and offer promotions

• Interact with customers to build personal relationships

What is influencer marketing?

Businesses pay influencers, celebrities, or other businesses to promote products/services to reach their target market.

Why is social media effective for new or small businesses?

It’s a cheap way to promote, attract new customers, and retain existing ones.

How can changing consumer tastes create opportunities for entrepreneurs?

Entrepreneurs can develop new products/services to meet changing preferences, e.g., zero-waste supermarkets for reusable containers.

What are demographics?

Characteristics of a population or customer base, e.g., age, gender, disability, nationality, religion, ethnicity, income levels.

How do businesses use demographics?

To identify and target a specific market for their products or services.

How can demographic changes affect business opportunities?

It can create new opportunities for businesses targeting specific groups.

Why do entrepreneurs develop innovative business ideas?

Because consumers’ wants and needs change over time due to lifestyle and technology changes.

Give examples of businesses responding to changing consumer demands.

• Vegan alternatives to meat/dairy

• Environmentally friendly products

Why must businesses constantly monitor the market, technology, and competitors?

o keep up with changing consumer demands and trends, and adapt or create new products.

What does “obsolete” mean in business?

Obsolete means a product is out of date and replaced by a newer product,

What is the product life cycle?

The product life cycle is the sales of a product over time, from launch, through growth and maturity, to decline when it may be replaced or updated.

Why do products become obsolete?

Products often become obsolete due to technological advancements that make them outdated.

How do businesses respond when products become obsolete?

Businesses replace obsolete products with updated versions or entirely new products to meet consumer demand and keep sales going

What is an invention in business?

An invention is creating something that did not previously exist,

What questions do entrepreneurs ask when developing new products or services?

• Is there a potential gap in the market I can fill?

• How can I introduce innovation into this product or service?

• How can I do this better or differently than existing businesses?

What is innovation in business?

the successful commercialisation of an invention or the adaptation of a product over time to improve its features, processes, or ideas.

Why is innovation important for businesses

Innovation can increase the likelihood of business success by creating new products, improving existing ones, or making processes more effective.

Give an example of innovation.

The traditional candle has been replaced over time by ultra-efficient, low-energy LED bulbs

What is adaptation in business?

Adaptation is the process of changing an existing product or service so it is suitable for different customers. It is often less risky than launching a completely new product

What are some types of adaptation for products?

• Changing the format of a product (e.g., cereal bars from cereal)

• Altering the colour or style to match trends

• Adapting promotional or advertising strategies

• Introducing new innovations (e.g., vegan sausage rolls)

Why do businesses adapt products or services?

Businesses adapt products or services to appeal to new or changing customer preferences, boost sales, and enter new markets without the higher risk of launching entirely new products.