EDEXCEL A-LEVEL BUSINESS THEME 1 FULL

1.1

Market - where buyers and sellers come together

Marketing - techniques that sellers undertake

 

NICHE; small market with specific needs

• Charge premium prices

• Avoid competition

• NOT spreading risk

• Larger firms can easily overrun

 

MASS; produce in large quantities to mass

• Lower unit cost allowing economies of scale to be exploited

• Higher profit margins

• High advertising costs

• Fierce competition

 

Market size - value/volume. Calculated by total sales of business, fluctuate

Market share - sales/total sales X 100. Market leader influence strategy of others and objectives

Brand - distinguish, differentiate, create image. Beneficial in mass market to be able to charge premium prices

 

ONLINE RETAILING

Consumer

• Global fashion

• 24/7 (USP)

• Distance is no object

• Delivery cost

• Allientae markets, elderly

• Quality

Business

• Save costs

• Global market

• Gather consumer info, be able to use direct marketing

• Website crashes, cause huge losses

• Cannot tap into certain markets

 

Markets change because of:

1. SIZE, grow or shrink affected by PLC

2. NATURE, product/service providing, consumer perceptions and trends

3. NEW, develop with technology

 

How businesses can adopt to change:

• Develop a niche

• Continuous improvement

• Investment

• Market research

• Flexibility

 

COMPETITION

Business

• Under pressure to get customers and can adopt methods such as

• Lower prices, better quality, advertise and promote, offer extras adding value

• Reduce profit potential

• Make barriers into market

Consumer

• Choice, in absence of competition consumers may be exploited

 

Risk - action taken by business and outcome unknown

Uncertainty - external influences beyond control

 

Product orientation - focuses on production process, products design, quality and performance

Market orientation - continuously identifies, reviews and analyses consumer needs. More engaged with effective marketing

• Respond quickly to change

• Confident in product launch

• Anticipate change from research/trends

• Meet and compete with rivals

Influences of market orientation..

• Nature of product

• Policy decisions

• Views of those in control

• Nature and size of market

• Degree of competition

 

THREE purposes of market research:

1. Identify and indicate customer wants and needs

2. Quantify likely demand

3. Insight into consumer behaviour

 

DATABASE - stores client info, easily searched and found facility

SOCIAL NETWORKING - global reach, cheap and analyses trends

WEBSITE - surveys, cheap and available 24/7

 

QUALITATIVE RESEARCH - attitudes, beliefs and intentions

QUANTITATIVE RESEARCH - measured and satisticalised

PRIMARY RESEARCH

• Questionnaires

• Posta surveys

• Focus group

• Test marketing

 

SECONDARY RESEARCH

• Internal data

• External data

 

SEGMENTATION

Geographic

• Different needs depending on where they live and different wants culturally

Demographic

• Age, gender, income, social class, ethnicity, religion

Psychographic

• Attitudes, opinions and lifestyle, difficult to collect data type

Behavioural

• Loyalty or impulse

 

BENEFITS

• Meet specific needs

• Increase revenue

• Avoid wasting resources

• Gain loyalty

 

Market positioning - conceptions consumers hold can use, benefits of products, USP, attributes of product, origin or classification

Market map - two dimensional, helpful for individual brands not corporate. Can only compare two features

 

Competitive advantage

• Design - differentiation

• Quality - premium price

• Promotion - personalise advertisement

• Customer service - exceed and deliver encouraging sales

• Ethical stance - segment

 

Differentiation;…