Define market
A market is any medium in which buyers and sellers interact and agree to trade at a price
Define market size
The total number of sales across all businesses which operate in that market
Define market share
The percentage of the market that a business sells to
Define mass marketing
The attempt to create products or services that have universal appeal
Define niche marketing
A niche market is a very small segment of a much larger market
Define dynamic market
One that is subject to rapid or continuous change
Benefits of operating in a mass market
- large scale production
- large sales = high sales revenue
- increased competitive advantage
- creates brand awareness
- reaches a larger audience
Drawbacks of operating in a mass market
- lots of competition
- high volume production may not be flexible enough to keep up with changes in demand
- easy for competitors to join market
- expensive to develop products that meet customer needs
Benefits of operating in a niche market
- premium prices could be charged
- small scale production may allow for more flexibility
- can target marketing in a very specific way
- usually less competition than in mass markets
Drawbacks of operating in a niche market
- lacks economies of scale
- often these markets are not profitable enough to cover the costs because the sales volumes are lower
- demand for the products may not be constant - especially for seasonal products
Define dynamic market
A market that is subject to rapid or continuous changes
What is an example of a dynamic market?
Online retailing
It is constantly changing ,developing, expanding and offering customers new products and new ways to shop
Define product orientation
A product orientated approach means the business develops products based on what it is good at making and doing rather than what consumers want
Advantages of product orientation?
- does not require MR
- easier/quicker production
- decisions are made much quicker
- business can create the product they want
Disadvantages of product orientation?
- does not consult consumer and therefore may not be what they want
- new business ventures cannot be confident the product will be a success without market research
- cannot compete successfully
Define market orientation
When the consumer is the most important factor when providing products for the market
Advantages of market orientation?
- respond quickly to changes in the market
- stronger position to meet the challenge of new competition
- anticipate market changes
- confidence in success of new product launch
- expand product portfolio
- celebrity endorsements
Disadvantages of market orientation?
- requires constant and continuous market research to keep up with trends
- requires products to be flexible
- some products are only market orientated to an extent (technology may limit this)
- increases costs - production/labour - may decrease profit margins
Define market research
Involves gathering and analysing information about the marketing and consumption of goods and services
What is primary research?
The collection of information first-hand for a specific purpose
What is secondary research?
The use of information that has already been collected
Examples of primary research?
- focus group
- test marketing
- observation
- personal interview
- surveys
Examples of secondary research?
- government publications
- loyalty cards
- internet
- competitors
- trade journals/ industry publications
- research agencies
Benefits and drawbacks of primary research?
Benefits: Up to date and detailed, meets specific needs of researchers, researchers have a good level of control
Drawbacks: Can be expensive, time-consuming and difficult to collect/analyse, issues with validity
