1.1.1 The market

• What is a mass market?

  • Products are aimed at broad market segments
  • Mass marketing occurs
  • Production usually happens on a large scale
• What is a niche market?

  • Products are aimed at a subset of the larger market.
  • Niche marketing occurs when businesses identify and satisfy the demands of a small group of consumers within the wider market.
  • Production usually happens on a small scale
• What are the characteristics of a mass market?

  • Products are less unique
  • Low average costs due to large scale production
  • Lower prices lead to high sales
  • Lower profit margins
• What are the characteristics of a niche market?

  • Products are more specialised and unique
  • High average costs, due to small scale production
  • High prices make products less affordable and lead to lower sales volume
  • Higher profit margins
• What is the formula for market share?

  (sales of a business / total sales in the market) x 100
• What is a dynamic market?

  A market that is subject to rapid or continuous changes. There are 4 factors to consider when examining dynamic markets:

  • Online retailing
  • how markets change
  • Innovation and market growth
  • Adapting to change
• What are the advantages of online retailing?

  • Provides business access to more consumers
  • Enables longer trading hours (open 24/7)
  • Cheaper to run
  • Businesses can collect data by tracking consumer behaviour
• What are the disadvantages of online retailing?

  • May be high costs for website development, maintenance and promotion.
  • Online retailing is dominated by larger businesses that are more well known.
  • High levels of competition
  • Lack of personal contact with consumers
  • Consumers may find it difficult to get the desired level of customer service
• What's the difference between risk and uncertainty?

  • Risk is the potential threat to business success
  • Uncertainty is when outcomes are difficult to predict.