BOOK 1
Saturday, September 12, 2020 9:33 AM
Business Page 1
,UNIT 1 : MARKETING & PEOPLE
Friday, September 11, 2020 11:54 PM
Business Page 2
,Meeting Customer Needs
Saturday, September 12, 2020 9:17 AM
Business Page 3
, 1. The Market
19 May 2021 17:08
Markets & Marketing:
Businesses make money by selling goods & services in markets.
• Markets were places where buyers & sellers would meet to exchange goods but now can be done without meeting up
○ E.g. Over the phone, internet etc.
Marketing - a management process involved in identifying, anticipating & satisfying consumer requirements profitably
Marketing involves:
• Identifying the needs & wants of consumers
• Designing products that meet these needs
• Understanding the threats from competitors
• Telling customers about products
• Charging the right price
• Persuading customers to buy products
• Making products available in convenient locations
The Characteristics of Mass Markets & Niche Markets:
Mass Markets - a very large market in which products with mass appeal are targeted
• Businesses sell the same products in the same way to all consumers & markets e.g. Crisps, Breakfast cereals etc.
○ The number of customers in these markets are huge- possibly billions if products are sold globally
▪ Thus meaning business produce large quantities at a lower unit cost by exploiting economies of scale
○ However, there is a lot of competition & therefore may spend a lot on marketing
Advantages Disadvantages
The number of customers in these markets are huge- possibly Lots of competition
billions if products are sold globally
Large Scale production means large economies of scale Homogenous products need to be differentiated through
marketing which can be expensive
Large Volume of sales means high revenue High volume production not flexible to demand changes
High revenue can be pumped into R&D
Businesses sell the same products in the same way to all
consumers & markets e.g. Crisps, Breakfast cereals etc.
Niche Markets - a smaller market, usually within a large market or industry
• Complete opposite of mass marketing
○ Involves selling to a small customer group, sometimes with specific needs
○ They may also avoid competition & with this lack of competition they can charge premium prices
• If a business successfully exploits a niche markets it still may attract competition
○ As the market is small it might be overrun by a large business if they enter
▪ Business that rely on a single niche may be vulnerable as they are not spreading their risk
▪ If they lose a grip in their chosen market, they may collapse as they have no other products or markets as
backups
Advantages Disadvantages
Charge premium price Very risky as demand may not be constant
Easier to target customers Higher unit costs so no economies of scale e.g. Tokyo old
cameras
Small scale production can be flexible and follow
trends
Less competition than in the mass markets
Market Size:
The size of a market can be calculated by the total sales of all business in the market
Usually estimated in a no. Of ways:
Business Page 4
Saturday, September 12, 2020 9:33 AM
Business Page 1
,UNIT 1 : MARKETING & PEOPLE
Friday, September 11, 2020 11:54 PM
Business Page 2
,Meeting Customer Needs
Saturday, September 12, 2020 9:17 AM
Business Page 3
, 1. The Market
19 May 2021 17:08
Markets & Marketing:
Businesses make money by selling goods & services in markets.
• Markets were places where buyers & sellers would meet to exchange goods but now can be done without meeting up
○ E.g. Over the phone, internet etc.
Marketing - a management process involved in identifying, anticipating & satisfying consumer requirements profitably
Marketing involves:
• Identifying the needs & wants of consumers
• Designing products that meet these needs
• Understanding the threats from competitors
• Telling customers about products
• Charging the right price
• Persuading customers to buy products
• Making products available in convenient locations
The Characteristics of Mass Markets & Niche Markets:
Mass Markets - a very large market in which products with mass appeal are targeted
• Businesses sell the same products in the same way to all consumers & markets e.g. Crisps, Breakfast cereals etc.
○ The number of customers in these markets are huge- possibly billions if products are sold globally
▪ Thus meaning business produce large quantities at a lower unit cost by exploiting economies of scale
○ However, there is a lot of competition & therefore may spend a lot on marketing
Advantages Disadvantages
The number of customers in these markets are huge- possibly Lots of competition
billions if products are sold globally
Large Scale production means large economies of scale Homogenous products need to be differentiated through
marketing which can be expensive
Large Volume of sales means high revenue High volume production not flexible to demand changes
High revenue can be pumped into R&D
Businesses sell the same products in the same way to all
consumers & markets e.g. Crisps, Breakfast cereals etc.
Niche Markets - a smaller market, usually within a large market or industry
• Complete opposite of mass marketing
○ Involves selling to a small customer group, sometimes with specific needs
○ They may also avoid competition & with this lack of competition they can charge premium prices
• If a business successfully exploits a niche markets it still may attract competition
○ As the market is small it might be overrun by a large business if they enter
▪ Business that rely on a single niche may be vulnerable as they are not spreading their risk
▪ If they lose a grip in their chosen market, they may collapse as they have no other products or markets as
backups
Advantages Disadvantages
Charge premium price Very risky as demand may not be constant
Easier to target customers Higher unit costs so no economies of scale e.g. Tokyo old
cameras
Small scale production can be flexible and follow
trends
Less competition than in the mass markets
Market Size:
The size of a market can be calculated by the total sales of all business in the market
Usually estimated in a no. Of ways:
Business Page 4
