Marketing key tast

• Market segmentation involves dividing a market into a smaller set of customers, or segments who have similar needs and interests
• mass market - a market where a business targets its advertising and promotional spending at the whole market, not at a particular segment e.g walkers crisps
• niche market - a smaller segment of a larger market where customers have more specific needs and wants
• Advantages of market segmentation for businesses

  • Meeting specific customer needs makes the customer gain loyalty and repeat purchase resulting in high levels of sales and profit
  • products which meet specific customer needs mean they can be charged for higher prices
  • Enables business to respond to changing markets in a timely manner
• Disadvantages of market segmentation

  • Greater number of products needed to be developed ( higher costs)
  • Greater level of market research required on each segment (Higher costs)
  • Shorter (smaller) production runs (leads to no economies of scale)
  • Managing complex product ranges can be difficult for business (which one to focus advertising on?)
• Purposes and advantage of carrying out market research

  • identify customer needs/ target market
  • identify gaps in the market
  • reduce the risk of failure (making sure customers demand the product/ servic)
  • Measure the effectiveness/ evaluating their actions (impact of price reductions/ new products)
  • understand competitors and analyse their actions
• key features of primary research

  • primary research collects data that is first hand and specific to the needs of your business. e.g
  • Questionnaires/ surveys
  • focus groups
  • interviews
  • mystery shoppers
  • product testing and trial
• Key features of secondary research

  • Secondary market research involves using data that already exists ( desk research)
  • eg
  • the internet
  • government produced data
  • industry magazines
  • market research companies
  • newspapers
• Advantages of primary research

  • specific to the business
  • provides detailed information
  • relevant and up to date
  • can contain a mixture of qualitative and quantitative data
• Disadvantages of primary research

  • Time consuming
  • expensive
  • sometimes difficult to collect
  • many businesses lack the expertise to collect the data
• Advantages of secondary research

  • already exists
  • quick and easy to gather
  • can be collected by industry experts
  • can be already analysed
  • cheap to collect
• Disadvantages of secondary market research

  • information collected unlikely to be specific to the business
  • information may be out of date
  • information may contain bias or be inaccurate
• Quantitive data is numerical data such as the size of the market or the number of customers a business has
• Qualitative data looks at views and opinions the data collected in written (no numbers)
• examples of quantitative data

  • involves gathering data and measuring responses
  • The data is conclusive and objective
  • data displayed in charts, graphs as statistics and percentages
• Examples of qualitative data

  • Data that captures subjects‘ views and opinions
  • a method to gather in depth opinions
• main market segment categories

  • Age
  • Gender
  • Income
  • Geographical location
  • Lifestyle