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1.1.1 The Market (Niche Market= subset of main market and address a…
1.1.1 The Market
Niche Market
= subset of main market and address a specialist need
Caters a particular segment of the market
e.g rolex watches
Profitable market
= prices high however consumers in that niche willing today the price.
small range of products
= Risky Ventures
Lack of economies as not enough products sold = businesses could not be viable
expensive items could be limited in the market
PROS
charge premium price
easier to target customers
small volume production = follow trends
less competition than mass markets
CONS
Risky as demand might not be constant
Higher unit cost = no economies of scale
Mass Market
= where a business sells its products to all consumers & Markets
Product sold to all consumers the same way e.g coca cola
PROS
Large scale production = economies of scale & lower average unit costs
everyone equally targeted
large volume sales = higher revenue
high revenues can be pumped into R&D
CONS
Lots of competition
homogeneous products need to be differentiated through marketing
=
Expensive
high volume production = hard to demand changes
Mass Market Brands
Branding instils
loyalty
in customers and
differentiates
the product
COMPETITION
more competition means business must listen to consumer needs and not be product orientated
more competition means business should be less wasteful
more comp means business must produce high quality
non-price factors persuade customers
Markets & Marketing
Marketing
= Range of activities that help the business sell goods
Market
= place where buyers and sellers meet to exchange goods.
Dynamic Market
= one that is subject to continuous or rapid changes
Online retailing
is dynamic as a lot of changes happen offering new things
CONS
Issues with item being returned
issues with online security (older people)
competitive market
problems with fraud
competitors always aware of pricing , model and activity
PROS
shop open round clock
orders taken autimatically
shop can reach international market
low overheads
stock easily updated and changed (dynamic)
Flexible
Market Growth
technology massive Market growth
Economic Growth
Innovation
social changes
changes in legislation
demographic changes
Market share
= proportion of market taken by business,brand or product
formulae for market share =
sales of x / total sales in market x 100
Market Size
= measured by volume of sales or physical quantity of products sold
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