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Business_A-level_Edexcel

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  1. 1-marketing-and-people

    1-1-meeting-customer-needs
    3 主题
  2. 1-2-market
    5 主题
  3. 1-3-marketing-mix-and-strategy
    5 主题
  4. 1-4-managing-people
    5 主题
  5. 1-5-entrepreneurs-and-leaders
    6 主题
  6. 2-managing-business-activities
    2-1-raising-finance
    4 主题
  7. 2-2-financial-planning
    4 主题
  8. 2-3-managing-finance
    3 主题
  9. 2-4-resource-management
    4 主题
  10. 2-5-external-influences
    3 主题
  11. 3-business-decisions-and-strategy
    3-1-business-objectives-and-strategy
    4 主题
  12. 3-2-business-growth
    4 主题
  13. 3-3-decision-making-techniques
    4 主题
  14. 3-4-influences-on-business-decisions
    4 主题
  15. 3-5-assessing-competitiveness
    3 主题
  16. 3-6-managing-change
    3 主题
  17. 4-global-business
    4-1-globalisation
    5 主题
  18. 4-2-global-markets-and-business-expansion
    5 主题
  19. 4-3-global-marketing
    3 主题
  20. 4-4-global-industries-and-multinational-corporations
    3 主题
  21. 5-exam-technique
    5-1-the-exam-papers
    4 主题
  22. 5-2-business-studies-skills
    1 主题
  23. 5-3-structuring-your-responses
    5 主题
  24. 6-pre-release-preparation
    2025-pre-release-music-industry
    9 主题
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Product and market orientation

  • Product orientation is an approach to marketing that focuses on the characteristics of the product rather than the needs of the consumer

    • The emphasis will be on creating a product first and then finding a market

      • The business has a belief that the product is superior; i.e. it will sell itself

    • Over time, being too product-oriented means the business may move further and further away from what the market is looking for, thus increasing the risk of business failure

      • E.g. Gillette’s razors can be classified as a product-oriented business, as the business focuses on the quality of its products, and regular innovations aim to increase sales

Flowchart titled Tools of Product Orientation with three branches: Product Research, Product Testing and Product Focus, each in green boxes.
Product orientation is an approach often used by inventors who research, test and produce a product well before market research has taken place 

  • Market orientation is an approach to marketing that focuses on the needs of consumers and uses this information to design products that meet customer needs 

    • Consumers are at the centre of marketing decisions

    • Products will be developed that respond to consumer needs

    • The business is likely to benefit from increased demand, increased profits and a valued brand image, as its products are desirable 

      • E.g. universities often develop new courses based on the feedback they receive from students and employers

Flowchart titled Tools of Market Orientation with branches to Market Research, Market Testing and Customer Focus in green boxes.
Market orientation aims to develop products to meet the needs identified by consumers during the market research process

Primary and secondary market research data

  • Market research is the collection, compilation and analysis of information about a market

  • Effective market research will help the business: 

    • Reduce risk when launching new products or entering new markets

    • Anticipate the future needs and wants of consumers

    • Understand consumer behaviour 

    • Identify potential consumer demand 

    • Identify how much consumers are prepared to pay for a product/service

    • Identify competitors and gauge their potential strengths and weaknesses

  • Market research data can be quantitative or qualitative

    • Both forms are useful, and any data analysis should ideally include a combination of the two

Primary research

  • Primary research is the process of gathering information directly from consumers in the target market using field research methods, such as surveys, interviews, etc.

    • Primary research gathers information that is new and does not necessarily exist in any format

Primary research methods

Method

Explanation

Surveys

  • The most widely used primary research method is sampling a population by using surveys

  • This is where you would ask a series of questions to a certain number of people (respondents)

  • The results from the sample are used to make inferences. This is where the results of the sample are extrapolated to be true for the wider population

  • A wide range of respondents can be reached using online survey tools, such as Survey Monkey

Observation

  • This involves hiring someone to stand in an appropriate location and study consumer behaviour in a store or perhaps judge the potential consumer traffic at a particular location

    • Researchers may observe the impact of packaging on consumer choice or the impact that the particular placement of a product in a store may have on consumer choice

Interviews

  • These questions may be set up in a very similar way to a survey; however, an interviewer asks the questions

  • This method takes longer but does allow the interviewee to ask follow-up questions and gather information that could easily be missed when conducting surveys

Test marketing

  • Free samples are provided for a limited period to the target market to gauge their response to the product

Focus groups

  • Free-range discussions, led by a marketing specialist, collect detailed feedback from a group of people in the target market

  • Usually limited to a small group of 12–15 people

  • The group typically meets for 1.5 to 3 hours

Advantages and disadvantages of primary market research

Advantages

Disadvantages

  • Information gathering is focused on the needs of the business and will not be available to its rivals

  • The sample size may be too small and unrepresentative of all customers, leading to unreliable results

  • The business can get in-depth information from respondents, for example, the reasons behind certain behaviour

  • Bias may mean that researchers can guide respondents to answer questions in a particular way

    • Similarly, respondents may be influenced by the responses of others or may not provide accurate information

  • Primary market research is more up-to-date and can be used to ask specific questions, so it will be more relevant

  • A business may need to hire a specialist market research agency to help, but this process can be expensive and time-consuming

Secondary research

  • Secondary research involves the collection, compilation and analysis of data that already exists

    • Typical methods include purchasing market reports from specialist companies or accessing government statistical portals that provide useful information

Advantages and disadvantages of secondary market research

Advantages

Disadvantages

  • Information is already available, so it is quicker to collect than through primary research, thereby saving time

  • Information has been collected for other purposes and so may lack relevance or may not be factually correct, e.g. Wikipedia 

  • Information is often free (e.g. government websites and internet sources such as Statista) or cheap to collect, leading to lower costs compared to primary research 

  • It can be expensive to purchase market-specific secondary data from specialist companies, e.g. Mintel reports 

  • It is suitable for a small business that lacks a large marketing budget and/or expertise

  • The information may be out of date, especially in dynamic markets

Using ICT to support market research

  • ICT refers to information and communications technology

  • It can be used to support market research in the following ways:

Company websites

  • Websites allow businesses to collect primary data cheaply, such as tracking consumer searches and analysing customer reviews, as well as collecting secondary data about rivals, e.g. prices and special offers

  • Pop-ups used on websites can also be an effective way of gathering information

Databases

  • These can be used to store large amounts of customer information, e.g. Tesco loyalty cards

  • Databases are also effective in collating customer email addresses so that targeted customers can be surveyed later via email

Social networking

  • This focuses on gathering information about consumers via online social channels, such as Twitter and Facebook

  • It is also useful as a method of running quick polls and surveys or tracking opinions about brands

Market segmentation

  • Market segmentation is the process by which a single market is divided into submarkets, or segments

    • Each segment represents a slightly different set of consumer characteristics

    • Firms often segment their markets according to factors such as income, geographical location, religion, gender and/or lifestyle

  • A market for a good such as crisps is not simply seen as one market; i.e. the crisp market is divided into many market segments, such as:

    • Dinner party snacks (Walkers Sensations, Pringles, Burts) with a premium price are targeted at middle to upper earners/professionals

    • Health-conscious crisps (Walker’s Lite, Walkers Baked, Ryvita Lite) are targeted at the health-conscious market

    • Lunch box value snacks (multipacks, Hula Hoops) are targeted at families and the mass market

Advantages and disadvantages of market segmentation

Advantages

Disadvantages

  • Recognises that consumers are not all identical

  • Consumer groups do not all share the same tastes and preferences

  • Not everyone within a segment will behave in the same way

  • Products and marketing activities can be altered to meet the different needs of different groups of consumers and targeted more precisely

  • It may be difficult to identify a segment, and consumers can belong to multiple segments at the same time

  • Less expensive and wasteful than marketing products to wide market segments

  • Segmentation requires more detailed market research, which can prove costly — but beneficial — to the business

  • May increase loyalty if the consumer feels that their needs are being met, which can lead to repeat purchases 

  • A market segment may be identified, but it may be too small and unprofitable to cater to

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