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Bus. St > 1.1 - Meeting Customer Needs > Flashcards

1.1 - Meeting Customer Needs Flashcards

1
Q

What is a market?

A

where buyers and sellers meet to exchange goods, now-a-days it is more specific e.g.

  • financial markets
  • housing markets
  • commodity ( raw materials e.g. coal, coffee) markets
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2
Q

What is Marketing?

A

a management process involves in identifying, anticipating and satisfying consumer requirements profitably.

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3
Q

What does Marketing involve?

A
  • range of activities that help a business sell its products
  • identifying the needs and wants of the customers
  • designing products that meet these needs
  • understanding the threats form competitors
  • telling customers about products
  • charging the right price
  • presuading customers to buy the product
  • making products available at a convenient location
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4
Q

What is a Mass Market?

A

a very large market in which products with mass appeal are targeted

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5
Q

What is a Niche Market?

A

a smaller market, usually within a large market or industry

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6
Q

What are some benefits of being in a mass market?

A
  • opportunities for large sales

- possibility of economies of scales

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7
Q

What are some drawbacks of being in a mass market?

A
  • Highly competitive

- Requires large investment in marketing –> in 2013 Coke spend $3.3bn on global marketing

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8
Q

What are some benefits of being in a Niche market?

A
  • Opportunity to charge higher prices

- First in the market advantages

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9
Q

What are some drawbacks of being in a Niche Market?

A
  • Risky for a business in a small market

- Vulnerable to large businesses entering the market ( who can also afford to charge lower prices)

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10
Q

What is Market Size?

A

is measured by either values of products sold or volume of products sold and is used to calculate market shares

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11
Q

What is Market Share?

A

the proportion of total sales in a particular market for which one or more business or brands are responsible. Expressed as a percentage and can be calculated by value or volume.

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12
Q

What is the Market Share Formula?

A

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

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13
Q

What can the Market Share Formula be used in comparison with?

A
  • compared to last years figures
  • compared to market shares in other countries
  • compared to competitors
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14
Q

What can businesses do with market share information?

A
  • Set new objectives

- replicate what the market leaders are doing

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15
Q

What is a Brand Name?

A

the name given to a product e.g. Coca-Cola

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16
Q

What may branding be used for?

A
  • differentiate the product from there rivals
  • create customer loyalty
  • help product recognition
  • develop an image
  • charge a premium price when brand becomes strong
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17
Q

What is a Dynamic Market?

A

markets that change

  • Music industry –> tapes, CD’s, MP3
  • Movie Industry –> VHS, DVD’s, Blu-ray, streaming
  • Drinks industry –> moving away from sugary drinks

if businesses dont adapt they fail e.g. Blockbuster, Woolworths

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18
Q

What is E-commerce?

A

conducting business transactions online

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19
Q

What is Online retailing or e-tailing?

A

the retailing of goods online

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20
Q

what are some benefits of E-tailing?

A
  • More access from people –> 24/7, and travel distance, some people dont like shopping or cant physically get to shops
  • Lower costs –> not as many staff wages (no staff wages)
  • Easier to get person information and then use it to target products and offers
  • It can be updated easily, ie ‘deal of the day’ imaging
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21
Q

When do new markets occur?

A
  • with a brand new product e.g. flat screen TVs, mobile phones
  • In ‘emerging markets’ –> BRICS/ MINT Market
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22
Q

What does BRICS stand for?

A
  • Brazil
  • Russia
  • India
  • China
  • South Africa
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23
Q

What does MINT stand for?

A
  • Mexico
  • Indonesia
  • Nigeria
  • Turkey
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24
Q

Why does Growth occur in new markets?

A
  • Economic Growth –> more disposable income leads to growth
  • Innovation –> new products the tablets or 3D printers, but also variations/ improvements i.e. Click and Collect
  • Social changes –> fewer marriages, more single parent families
  • Changes in legislation –> e.g. ban on tobacco advertising and smoking in public places
  • Demographic changes – its growing also other people
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25
Q

How do businesses adapt to change?

A
  • Flexibility –> having a flexible culture , with multi-skilled staff, flexible machinery and operations
  • Market research –> this should be ongoing with current and potential customers
  • Investment –> in new product development and also in training and new, flexible machinery
  • Continuous Improvement –> in all aspects, more efficiency - saves money better customer service - means repeat purchases
  • Develop a niche –> if that market does change and you cant specialise in what you do do e.g. Harley Davison
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26
Q

How do businesses attract customers?

A
  • lowering prices
  • Making products appear different
  • better quality
  • better promotion
  • Extra’s e.g. customer service

Those all come at a costs and reduces profits!

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27
Q

How do businesses deal with competition?

A
  • some businesses may decide to take over their competition

- they may try ways to beat competitors e.g. big advertising campaigns, Laws are in place to stop unfair competition

28
Q

Who benefits from competition?

A
  • customers benefit from this competition as they get more choices
  • Government –> when competition doesnt exist they can be exploiter, High prices and little innovation
29
Q

What are external factors which could impact a businesses?

A
  • Competition
  • Consumer tastes change because of a social trend
  • New government legal policies
  • New technology
  • Natural disaster i.e. floods
  • The economy going into a recession
30
Q

What is a Product-Orientated business?

A

more historical businesses, they make products they think customers will want to buy and that will sell well

31
Q

What is a Market-Orientated business?

A

This business is one which continually identifies, reviews and analyses customer needs, they must address the marketing mix

32
Q

How does Market-Orientated businesses have advantages over product orientated businesses?

A
  • it can respond move quickly to changes in the market
  • it will be in a stronger position to meet challenger of new competition entering the market
  • it will be more able to anticipate market changes
  • it will be more confident that the launch of a new product will be a success
33
Q

What makes a business become product or market orientation?

A
  • The Nature of the product–> new technologies, customers pharmaceuticals - product-based
  • Policy decisions –> is the business objective market share or safety
  • The views of those in control –> an engineer or marketer
  • The nature and size of the market –> if production costs are high - market orientated to ensure you’re launching a product costumers want
  • The degree of competition –> highly competitive - market
34
Q

What does the Market segmentation acronym AGARISE stand for?

A
  • Age
  • Gender
  • Area
  • Religion
  • Income
  • Socio-economic groups
  • Ethnicity
  • Life-style
  • Life stage e.g. newly-weds
  • psychographic –> ethical financial product (attitudes, opinions and lifestyle
  • Behavioral –>loyalty , time and data consumption helps with marketing, usage rates
35
Q

What are the socio-economic groups?

A 
A- Upper Class
B- Middle Class
C1 - Lower Middle Class
C2 - Skilled working Class
D - Working class
E - The poor
36
Q

What are the advantages of market research?

A
  • meet the needs o what your researching

- qualitative and quantitative data

37
Q

What are disadvantages of market research?

A
  • time-consuming
  • expensive
  • telephone –> if they know their home they are going to be less honest
  • human behaviour
  • postal surveys–> people may not reply
  • consumer panel –> need to gather a wide range of people
38
Q

What is Market Research?

A

the process of gaining information about customers, competition and market trends through collecting primary and secondary data

39
Q

What can Market Research tell a business?

A
  • what features customers what
  • how much they are willing to pay
  • where they shop
  • what age and gender they are
  • who the main competitors are
  • if the market is shrinking or growing
40
Q

What is Primary research?

A

the gathering of new information, called primary data, which has not been collected before

41
Q

Examples of Primary research…

A
  • Questionnaires and Surveys
  • Hall tests
  • Observation
  • Focus groups
  • Experiments
42
Q

What is Secondary research?

A

the process of gathering secondary data, which is information that has already been gathered, such as sales records or government statistics

43
Q

Examples of Secondary Research…

A
  • Newspapers
  • sales records
  • government statistics
  • Internet
  • market research companies
  • office of national statistics
44
Q

Advantages to Primary research?

A
  • more accurate
  • up to date
  • specific to needs
  • effective at collecting qualitative data
  • direct customer contact
45
Q

Disadvantages to Primary research?

A
  • time consuming

- high costs

46
Q

Advantages to secondary research?

A
  • quicker
  • costed less money
  • effective at collecting quantitative data
47
Q

Disadvantages of secondary research?

A
  • more general

- no specific to needs

48
Q

What is Qualitative data?

A

information collected by obtaining people’s opinions, judgments and attitudes

49
Q

What is Quantitative data?

A

data that can be expressed as numbers and can be statistically analysed

50
Q

How can businesses analyse customers buying habits?

A
  • finding information about customers
  • using their own experience
  • looking at existing businesses and trying competitors products
  • observation and surveys
51
Q

How is ICT useful for a company website?

A

-can be designed well and easy to use
-Cheap to administer and open 24/7
Easy to collect reviews and easy to view competition and compare
-Comparing can also be easily done by checking prices of using price comparison websites

52
Q

How is Social Media useful to a business doing market research?

A
  • Provide numerous ways to analyse data and trends

- Better than simple questions which can be misinterpreted, its about interaction and observation

53
Q

What is the benefits of using ICT for market research?

A
  • Broad reach
  • Ability to target more specifically
  • Free or Low cost e.g. social media
  • Personal–> aimed as if it is at each individual customer
  • Fast –> information ca be collected very quickly from large numbers of people
  • easy –> High level I.T. skills and complex equipment are not needed
54
Q

How does Databases help support market research?

A
  • you can purchase databases full of customer info
  • business will have large databases to analyse
  • it must meet DPA requirements
55
Q

What is Market positioning?

A

the perceptions consumer have about products e.g. quickly status and value for money

56
Q

What affect your perceptions of a product?

A
  • the benefits offered by a product
  • the unique selling point (proposition)
  • The attributes of the product ( M&M’s melt in your mouth not your hands)
  • The origin of the product
  • The classification of the product (jaffa Cake/Biscuit, I can’t believe its not butter)
57
Q

What can happen to a businesses products when the markets change?

A

they can reposition

  • Burberry –> Hooligans , to high end
  • Aldi –> cheap, best value for money
58
Q

What is a Market Map?

A
  • perceptual map or positioning map
  • typically a two dimension diagram that shows two of the attributes or characteristics of a brand and those of a rival brands in the market
59
Q

What is Product as part of the Marketing Mix?

A
  • sell the product customers want–> meet the customer needs
  • have the correct attributes and features that customers want
  • to differentiate their products from the competition
60
Q

What is Place as part of the Marketing Mix?

A
  • is the way the product gets distributed
  • how it gets from the producer to the consumer
  • Even which shelf the product sits on
  • businesses have to consider the channel they go through e.g. online or through retail stores
  • For examples, a luxury suit might be sold in a upmarket boutique
61
Q

What is Promotion as part of the Marketing Mix?

A
  • Promotion is the communication between the business and customers to make them aware of its product as well as:
  • advertising
  • sales promotions
  • sponsorship
  • public relationship
62
Q

What is Price as Part of the Marketing Mix?

A
  • the value customers place on the product
  • higher quality products normally charge more
  • Customers are wiling to pay more for special features
  • Price is very subjective because it depends on many factors such as commodity prices and the price set by competitors
63
Q

Why arent Market Maps useful?

A

-is only 2D and require lots of primary research (expensive)

64
Q

What is the purpose of differentiation?

A
  • Trying to get your product to stand out, giving it a competitive edge
  • It could be as simple as the packaging trying to give perceived difference or advertising
  • Charge a premium price
  • Stand Out
  • Extend product range
  • Overcome competition - aim gain market share, with large scale business, you can lower costs and gain more Economies of Scale
65
Q

How to add value to a Product or service?

A
  • Bundling - offering a package
  • Good Customer service
  • Speed of response to customers e.g. dry cleaning
  • Packaging
  • Frequent buyer offers –> reward cards
  • Customisation - putting a customers logo or brand in the product

Bus. St (20 decks)

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