the market

niche marketing: targeting a relatively small segment of the market e.g. selling a Judo magazine

benefits towards niche marketing

less competition

small-scale production

tailor-made products

mass marketing: targeting a large part of the market or the whole market with a product that appeals to a wide range of consumers

benefits of mass marketing

large-scale production

high revenues

brand awareness

drawbacks of mass marketing

changes in demand - fall in demand means some assets such as machinery is not used

fixed capital

more competition means it is harder for the business

drawbacks towards niche marketing

lower profits

changes in demand

market entry - large firms may join the market if the demand for the particular product increase

market size: is the total sales of all the companies within a market place. measured in terms of 2 things: the number of units sold and the amount of spending.

market share: is the percentage of total market sales held by one firm

market share = the product of firm's sales / total market sales

dynamic market: is one with the potential to rapidly change

disruptive technology: is where new technology has the potential to change the way the market operates

advantages of online retail for the business

easy access to market

reduced overheads - selling online can remove the need for expensive retail premises and customer-facing staff, allowing you to invest in better marketing and customer experience

customer intelligence - ability to use online marketing tools to target new customers and website analysis tools to gain insight into customers needs

disadvantages of online retail for the business

website costs - planning, designing, creating, hosting, securing and maintaining a professional e-commerce website isn't cheap

infrastructure costs - even if you aren't paying the cost of customer-facing premises , you'll need to think about the costs of physical space for order fulfillment, warehousing goods etc.

risk: something that can be planned for - outcomes are known. a risk is taken if the rewards are high. risk can be minimized by market research

uncertainty: is caused by unexpected often external factors which may be unpredictable. example: tsunamis

market size calculation:
adding together the number of items sold by all the different firms operating in the same market


or


adding together the sales revenue of all the different firms

online retail:
online retailing is growing at an astonishing rate, with online sales now accounting for around one quarter of the total retail market. this is a dynamic market which is unpredictable. retailers who ignore e-commerce may see a drop in their sales. however, a business should always consider the advantages + disadvantages of expansion

competition: occurs when two or more businesses act independently to supply goods and services to the same group of consumers. competition can be direct / indirect

direct competition: is when businesses produce similar products that appeal to the same group of consumers

indirect competition: occurs when different businesses make or sell products that are not in direct competition but compete for the same consumer expenditure