The Role of Marketing (Cambridge (CIE) IGCSE Business): Revision Note

Identifying and satisfying customer needs

• Marketing helps a business identify and satisfy the needs and wants of its customers

  • Identifying customer needs involves finding out about the

    • Variety and quality of goods and services that customers want

    • Prices they are willing to pay

    • Promotional techniques that may persuade them to make repeated purchases

    • Convenience factors, including where and how they want to purchase products

    • After-sales services they anticipate

  • Satisfying these customer needs involves ensuring products are available when and where customers want to buy them, at a suitable price, at the quality expected and with effective customer service

The benefits of identifying customer needs

• Businesses that successfully identify and satisfy customer needs 

  • Compete more effectively than rival businesses 

  • Keep up-to-date with changing tastes and preferences

  • Attract positive word-of-mouth recommendations and build the brand

Benefits of satisfying customer needs

Maintaining customer loyalty and building relationships

• Customer loyalty is when existing customers buy products from the same business over and over again

  • Customer loyalty leads to repeat purchases and a rise in market share. 

  • It is much cheaper for a business to try to keep existing customers (for example, with loyalty cards) than to try to gain new customers, as this can involve expensive advertising campaigns

• Building customer relationships involves communicating with customers to encourage them to become loyal to the business and its products

  • Good relationships are maintained by

    • Developing close ties with customers and finding out if products are continuing to meet their needs 

      • For example, using surveys to discover if preferences are changing

    • Using technology to gather important information about customers

• By having strong relationships with the customer, the business can respond appropriately when customers change their expectations

Anticipating changes in customer needs

• Predicting what customers will want or need in the future helps a business stay ahead of competitors and continue meeting customer expectations

The role of marketing in anticipating customer needs

• Market research

  • Surveys, focus groups and sales data help businesses understand what customers want now and in the future

    • For example, McDonalds uses customer feedback and sales data to test new menu items like the McPlant burger, designed for the growing demand for plant-based food

• Product development

  • Teams use this research to improve or create products that meet changing needs

    • For example, Apple developed AirPods after noticing customer demand for wireless and portable earphones, especially among smartphone users who wanted more convenience

• Promotions

  • These can be adjusted to demonstrate how products match new customer values or interests

    • For example, Coca-Cola launched its World Without Waste campaign and promoted its recycled plastic bottles to appeal to environmentally conscious consumers

• Pricing strategies

  • These may change if customers become more price-conscious

    • For example, Netflix introduced a lower-cost plan in some countries to attract budget-conscious viewers during a time when many households were cutting back on spending