Lecture notes
markets topic notes unit 1 as level business
- Module
- A level business Ed excel
- Institution
- A Level Business Ed Excel
aesthetic business studies notes for Edexcel as level unit 1: markets
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● MARKETS AND MARKETINGDifferent types of markets:
➔ Consumer goods market: where products such as food, cosmetics etc are sold
➔ Service markets: hairdresser, editing, etc
➔ Housing market: properties
➔ Commodity market: raw materials trading
➔ financial markets: currency trading
What is marketing and what does it do?
- Marketing is what helps a business sell its products
- This is done by:
Identifying the needs of consumers
Designing products to meet these needs
Understanding competition
Finding the right price to charge
Making products easily accessible
Mass markets
- when a business sells the same product to all consumers and markets them in the same
way. Ex (cereal )
- Businesses can produce large quantities at a lower cost (economies of scale)
- Lots of competition
Niche markets:
- a small market segment, a segment that has been untouched by a larger business.
- They often survive by supplying rival markets
- Less competition = less change
- Unique Selling Point
- Individual market: tailored to a customer's needs. Product or service (therapy)
MARKET SIZE:
- Can be calculated by the total sales of all the businesses in the market
- There is value and volume
- Different markets have different market sizes
- Volume- how many products are sold
- Value: the total amount spent by customers buying products
MARKET SHARE;
❖ the proportion of a particular market that is held by a business, a product, a brand, etc.
❖ Indicates if a business is a market leader
❖ Indication of success or failure to a business
, ❖ This way they can respond to it with a marketing strategy
❖ ex. coca-cola wants to know how much diet coke they've sold.
market leader benefits:
★ Increased sales
★ Can increase price
★ Low risk, can try out new products
Mini concepts:
Economies of scale:
- Buying in bulk
- Discectomy of scale: there is a limit, cannot produce more- not enough
warehouses ect. Outsourcing. It would cost more
Segment:
- Retail companies- perishable goods/ non perishable -> segments within a
business
- Segments within an industry: ex, beauty industry
Rapid growth in one segment:
Why: new products- new marketing strategy
Result: sales will be more consequence related
INNOVATION AND MARKET GROWTH:
Markets grow due to:
➔ innovation (ex. Apple inc)
➔ Social changes: can impact market share, sales, and volume, Due to new demands
➔ Changes in regulation: plastic ban, co2 emissions-
➔ Demographic changes: expats looking for their local products in foreign places
ADAPTING TO CHANGE:
● Ex. pandemic- making e commerces
● Having a backup
● Being flexible (could be with staff training)
● Invest in new markets
● Diversifying customers ( comes at a price)
HOW COMPETITION AFFECTS THE MARKET
● Competition is the rivalry that exists between businesses in a market.
● Competition has an impact on both businesses and consumers in the market.
Businesses:
- Competition puts businesses under some pressure.
, - encouraging customers to buy their products in preference to those of rivals.
methods include:
★ lowering prices
★ making their products appear different
★ offering better quality products
★ using more powerful/ attractive advertising
★ offering 'extras', such as high-quality customer service.
All of these methods cost money = reduce the amount of profit a business can make.
Other methods to survive
- take over their rivals (purchasing a rival in the market)
- create obstacles that make it difficult for others to enter the market.
- legislation that prevents businesses restricting competition using practices that are
considered unfair.
Consumers:
- Consumers benefit from competition in markets.
- More choice= bigger range of models, styles, colours and endless variations in
specifications.
- Better-quality products and lower prices.
RISK AND UNCERTAINTY:
RISK :
● decision-making situations under which all potential outcomes and their likelihood of
occurrences are known to the decision-maker,
UNCERTAINTY:
● uncertainty refers to situations under which either the outcomes and/or their probabilities
of occurrences are unknown to the decision-maker
MARKET RESEARCH
➔ Gathering and analysing information about the consumption of goods and services.
➔ it helps to reduce the risk of failure.
➔ Products that are well researched are more likely to be successful
Identify and anticipate customer needs and wants:
- Businesses can clarify the specific needs and wants of consumers.
- In order to design products that are likely to sell
Quantify likely demand:
- how much of a product a business might expect to sell in a market. (quantitative)
- If demand is low, a business might cancel the launch of a product.
- This saves a lot of money.
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