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IGCSEBusinessCambridge (CIE)Flashcards3. Marketing3.1 Marketing & the Market

3.1 Marketing & the Market (Cambridge (CIE) IGCSE Business) Flashcards

Exam code: 0450, 0986 & 0264, 0774

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  • FrontThe Role of Marketing

    Define customer loyalty.

Cards in this collection (33)

  • Define customer loyalty.

    Customer loyalty is when existing customers buy products repeatedly from the same business.

  • Why is it usually cheaper for a business to keep existing customers rather than gain new ones?

    It is usually cheaper for a business to keep existing customers because gaining new customers often requires expensive advertising campaigns, while keeping current customers may only need loyalty cards or similar incentives.

  • How can businesses build strong customer relationships?

    Businesses can build strong customer relationships by communicating with customers, gathering feedback, and ensuring products meet their needs.

  • What are two main benefits to a business of successfully satisfying customer needs?

    Successfully satisfying customer needs allows a business to compete more effectively and attract positive word-of-mouth recommendations.

  • True or False?

    Providing after-sales services is not important for satisfying customer needs.

    False.

    Providing after-sales services is important for satisfying customer needs and can influence repeat purchases.

  • Define market research.

    Market research is the process of collecting information about customers’ needs and preferences to help anticipate future trends.

  • How can a business use promotions to anticipate changes in customer needs?

    A business can use promotions to highlight how its products meet new customer values or interests, such as promoting eco-friendly packaging to attract environmentally conscious buyers.

  • How does maintaining customer loyalty benefit a business's market share?

    Maintaining customer loyalty leads to repeat purchases and helps the business increase its market share.

  • Define market share.

    Market share is the proportion of total sales a business has in a market compared to the market as a whole.

  • What is the formula for calculating market share?

    Market space share space equals space fraction numerator Sales space of space straight a space business over denominator Total space market space sales end fraction space space cross times space 100.

  • Define competition.

    Competition is when at least two businesses provide goods or services to the same target market.

  • Give two benefits of increased competition for customers.

    Increased competition leads to lower prices and better-quality products for customers.

  • What might cause customer spending patterns to change?

    Changes in tastes and fashions, disposable incomes, demographic changes, global influences, and technology can all cause spending patterns to change.

  • Define disposable income.

    Disposable income is the amount of money a person has left to spend after taxes and essential expenses.

  • Why is new product development important for businesses facing competition?

    New product development helps a business stay competitive, attract new customers, and build brand loyalty.

  • True or False?

    Minimising costs can help a business remain competitive in the market.

    True.

    Reducing costs allows a business to offer lower prices or increase profit margins, helping it stay competitive.

  • How has technology increased market competition?

    Technology and e-commerce have lowered barriers to entry, allowing new businesses to easily enter and compete in markets.

  • Define mass market.

    A mass market is a market where products are aimed at broad market segments, usually with standardised products and large-scale production.

  • Define niche market.

    A niche market is a market where products are aimed at a small subset of customers with specific needs, often involving specialised or made-to-order products.

  • What is mass marketing?

    Mass marketing is when businesses sell their products to most of the available market, targeting broad segments with little differentiation.

  • What is niche marketing?

    Niche marketing occurs when businesses identify and satisfy the demands of a small group of consumers within the wider market.

  • True or False?

    Mass market products usually have high levels of differentiation.

    False.

    Mass market products are generally standardised with little differentiation, designed to appeal to a wide audience.

  • True or False?

    Niche market products are usually produced on a large scale.

    False.

    Niche market products are typically produced on a small scale, often tailored to specific customer needs.

  • Give one advantage for businesses operating in a mass market.

    One advantage for businesses in a mass market is the ability to benefit from economies of scale, which reduces average costs and allows competitive pricing.

  • What is a potential risk for a business that relies heavily on a niche market?

    A business that relies heavily on a niche market may become too dependent on one product or market, increasing risk if demand falls.

  • How can a niche market become a mass market?

    A niche market can become a mass market if large businesses recognise its growth potential and begin to target it, expanding the customer base (e.g. energy drinks).

  • Define market segmentation.

    Market segmentation is when a single market is divided into submarkets or segments, each with different customer characteristics.

  • What are the five main ways to segment a market?

    The five main ways to segment a market are age, income, location, gender and lifestyle.

  • True or False?

    A surfwear brand is likely to segment its market based on location.

    True.

    Surfwear brands target customers in coastal areas where demand is higher due to local climate and interests.

  • Define lifestyle segmentation.

    Lifestyle segmentation is grouping customers based on their interests, hobbies, values or how they spend their time.

  • What is one advantage of market segmentation for businesses?

    Market segmentation allows businesses to tailor products and marketing to meet the needs of specific groups, which can increase customer loyalty and sales.

  • True or False?

    Market segmentation always guarantees that all customers in a segment will behave in the same way.

    False.

    Not everyone within a segment will behave the same way, as customer behaviour can vary even within segmented groups.

  • How does market segmentation help businesses avoid wasting resources?

    Market segmentation helps businesses avoid wasting time and money advertising to people who are unlikely to be interested in their products.

Previous:2.4 Motivating EmployeesNext:3.2 Market Research

    1. 1.1 Business Activity

    2. 1.2 Economic Sectors

    3. 1.3 Enterprise, Business Growth & Size

    4. 1.4 Types of Business Organisation

    5. 1.5 Business Objectives & Stakeholder Objectives

    1. 2.1 Human Resource Management (HRM)

    2. 2.2 Organisation & Management

    3. 2.3 Methods of Communication

    4. 2.4 Motivating Employees

    1. 3.1 Marketing & the Market

    2. 3.2 Market Research

    3. 3.3 Marketing Mix

    4. 3.4 Legal Controls

    1. 4.1 Production of Goods & Services

    2. 4.2 Technology and the Production of Goods & Services

    3. 4.3 Sustainable Production of Goods and Services

    4. 4.4 Costs, Scale of Production & Break-even Analysis

    5. 4.5 Quality of Goods & Services

    6. 4.6 Location Decisions

    1. 5.1 Business Finance

    2. 5.2 Cash Flow Forecast

    3. 5.3 Profit & Loss

    4. 5.4 Statement of Financial Position

    5. 5.5 Analysis of Accounts

    1. 6.1 Economic Issues

    2. 6.2 Business & the International Economy

    3. 6.3 Business & the Environment

    4. 6.4 Business & Ethical Issues

    5. 6.5 Pressure Groups