Chapter #3: Market Potential, Market Demand and Market Share Flashcards Preview

3028MKT - Strategic Marketing > Chapter #3: Market Potential, Market Demand and Market Share > Flashcards

Flashcards in Chapter #3: Market Potential, Market Demand and Market Share Deck (23)
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1
Q

What is a major cause of missed market opportunities and the greatest threat to business survival?

A

A narrow focus on existing product markets

2
Q

Why do we estimate a market space and market potential?

A
  • View demand beyond existing
  • Recognise emerging MKT opportunities
  • Identify gaps
  • Identify similar markets
3
Q

What is the definition of a “narrow market”?

A

A market adopted by design - smashing a niche (not always a limitation but a better assessment)

4
Q

Why is it important to assess market demand?

A

To understand the number of units that can be consumed and identify the saturation point (once reaching saturation, new customers become hard to find)

5
Q

What are the 3 types of innovation?

A

Continuous
Disruptive
Discontinuous

6
Q

What is continuous innovation?

A

The development of technology and improved products for a given market

7
Q

What s disruptive innovation?

A

Change along the technology innovation curve that allows for the development of new products that are less expensive, smaller or easier to use

8
Q

What is discontinuous innovation?

A

A major shift from an old technology to a new technology that usually offers new customer benefits

9
Q

Once new technology reaches a tipping point, it develops more rapidly through ___________.

A

Continuous innovation

10
Q

Which markets tend to be well below their market demand potential?

A

New and global markets (mass scale, many customers to attempt to saturate)

11
Q

What are the 7 major forces that restrict a product from realising its market potential?

A
  • Unaffordable
  • Unrecognised need
  • Lack of awareness
  • Lacks desired performance
  • Customers lack skills to use
  • Insufficient infrastructure
  • Unavailability
12
Q

What 3 forces affect the rate of market growth?

A

Market potential
Market penetration
Rate of entry

13
Q

What are some other forces affect market growth rate ?

A

Customer (need, risk, buying, observation, trial)

Product (advantages, affordability, ease of use, performance, availability)

14
Q

Products/services with weak overall scores for customer forces and product forces experience ____________.

A

Very slow market growth

15
Q

When customer forces and product forces are strong overall ___________.

A

Steady market growth can be achieved.

16
Q

What does NMC stand for?

A

Net Marketing Contribution

17
Q

An average decline in the average selling price of a product typically results in _________________

A

Demand growth

18
Q

Why do we estimate market potential?

A

To understand where the ceiling lies so that businesses do not project growth beyond what is possible

19
Q

What does the “Market Share Performance Tree” show us?

A

It indicates how the customer response to a strategy influences market share

20
Q

What does MSI stand for?

A

Market Share Index

21
Q

What does Market Share Index (MSI) tell us?

A
  • Causes of lost mkt share
  • Identify mkt share change for improvements
  • Reasonably estimate profit potential
22
Q

What does SDI stand for?

A

Share Development Index?

23
Q

Why do we look at MDI and SDI together?

A

Tells the potential for future sales growth and specifically, whether a business should focus on market development, share development or both (depending on the growth opportunity portfolio)