Market Analysis

• What is a market segment?

  Customer group with distinct preferences
• What does market segmentation involve?

  Dividing the market into segments
• What does demographics study?

  Population characteristics
• How are socio-economic groups classified?

  By job and household income
• What classification system is used for households based on postcodes?

  ACORN system
• What are the types of households in the family life cycle?

  Young single, young couple, old couple
• Why is it important to segment the market?

  • Identifies groups of customers
  • Focus on meeting specific needs
  • Allows targeted advertising
  • Enables product adaptation
  • Increases customer satisfaction
• What is a mass market?

  Targeting a wide range of customers
• What is a niche market?

  Targeting a specific market segment
• What are the criteria for identifying market segments?

  • Location (ACORN)
  • Demographics (gender, age)
  • Lifestyle (hobbies)
  • Income (socio-economic group)
  • Behavior (impulse buying, purchase frequency)
• What is market mapping?

  Evaluating goods/ideas/services by two features
• Why is market mapping important?

  It shows products, competitors, and market gaps
• What does market mapping reveal about the market?

  • All products in the market
  • Competitors
  • Gaps in the market
• What are possible axes for market mapping?

  Price, quality, range of products, outlets, age
• What might a gap in the market indicate?

  There may be reasons for a gap in the market
• How can price and quality be represented in market mapping?

  As axes on a graph to evaluate products
• What does a high price and low quality indicate in market mapping?

  It shows a potential market gap
• What is the significance of evaluating goods/ideas/services?

  To identify strengths and weaknesses in the market