marketing and people 1.1-1.3

• Market


  A place where buyers and sellers meet
• Niche market


  • Smaller part of an overall market (highly differentiated/low sales volume)
• Mass markets


  • Larger part of an overall market (high sales volume/low profit margins)
• Market size


  Total volume of sales in a market
• Market share


  Shows the sales of one firm out of the whole market
• Calculating market share


  Market share = sales of one firm / total market share
• Market growth


  Percentage change in size of the market
• Calculating market growth


  Market growth = change in market size/original market size
• Dynamic market


  • Markets that are constantly changing slowly or rapidly
• Brands


  How a business distinguish themselves from competitors
• Innovation


  The launch of a new idea or invention
• Types of innovation


  • Product innovation (launch of new goods/services)
  • Process innovation (new production method available)
• Risk


  When the chance of outcome can be predicted and so they can be managed
• Uncertainty


  When the chance of outcome can't be predicted
• Product orientated


  • A business looks at what it can make given its resources and strengths, focuses on quality but R&D is expensive
• Market orientated


  • A business uses market research to find out what is wanted by the consumer, requires less promotion however it is expensive
• Primary data


  Data that is original and is collected first-hand (survey/interviews), specific to needs and competitors can't see it however its time consuming
• Secondary data


  Data that is pre-existing (Wikipedia or past news articles), cheaper than primary research but may be old information
• Quantitative data


  Numerical data
• Qualitative data


  Data that is about feelings or opinions
• Market research


  The process of gathering information about market customers etc, often expensive
• Market segmentation


  • Geographical
  • Demographic
  • Behavioural
  • Psychographic
• Market positioning


  How products are seen by consumers in relation to competition
• Market graph


  Used to brands in order of 2 variables such as price and quality
• Competitive advantage


  A feature that helps one business differentiate from another
• Product differentiation


  Making a product distinct from rivals
• Added value


  The difference in price consumers pay and the cost it cost the business
• Calculating added value


  1. Added value = selling price per unit - cost of materials

  2. Total added value = revenue - cost of materials
• Demand refers to the number of goods/services customers are willing to buy at a given price
• • As the price increases, the quantity demanded decreases
• • As price decreases, the quantity demanded increases
• • As price decreases, the quantity demanded increases
  • Hence the demand curve slopes downwards from left to right

  
• supply is the number of goods/services a business is willing to sell at a given time and place
• theres a direct relationship between price and quantity as price increases so does quantity as price decreases quantity decreases
• supply diagram

  
• factors affecting a supply diagram

  changes in price of production increase in production cost causes decrease in supply vice vera

  advances in technology lead to lower unit costs to more supply

  external shocks can lead to both decrease in supply or increase
• supply and demand diagram

  reach an equilibrium

  
• ped helps us calculate how responsive change in quantity demand is to a change in price.
• ped = % change in Quantity demand

  % change in price
• percentage = new value - old value / old value x 100