a) Mass markets and niche markets: o characteristics
-market size and market share, brands
b) Dynamic markets:
- online retailing
-how markets change
- innovation and market growth, adapting to change
c) How competition affects the market
d) The difference between risk and uncertainty
What is a market?
A market is any place that buyers and sellers will come
together to exchange goods or services. There will normally be
an exchange of money at a set price.
What is the nature of the market?
Today, markets take numerous forms e.g. local, national,
physical or electronic. Examples include the corner shop, the
Stock Exchange, the housing market and the Internet for online
retailing e.g. eBay or ASOS.
Mass markets
o A product is targeted at a wide range of people
o The market is not segmented i.e. the characteristics of
types of customers are not an important factor
o Products appeal to a wide range of customers
o Products are widely available through a range of markets
o Mass media is used to advertise the products
Niche markets
Identifying small, currently unsatisfied, gaps in the market
The target market is well defined with distinct characteristics
Promotional activities will be targeted at just a small subsection
of the whole market
Can often charge higher prices
Mass markets and niche markets
Market size – this is the total value or volume of sales in the
market. It can be measured in money terms e.g. £20 million or
by the amount sold e.g. 1 million cars
Calculated as: Number of units sold x price
Market share – this is the proportion of total market sales that a
firm has
, Calculated as: Sales of one firm/Total market sales x 100
Brands
o A brand is a product produced by one business using a
specific name
o Branding involves the creation of an identity for the
business that distinguishes that firm and its products from
other firms
o Consumers have a perception of what to expect from a
particular brand e.g. quality, satisfaction
o A brand is a trademark that cannot be copied
o Brands can be:
o Name
o Shape
o Symbol
o Colour
o Logo
o Branding can add value to a product allowing firms to
charge higher prices and also leads to brand loyalty
whereby customers will continue to buy products from
that firm
Images
Celebrity
Colour
endorsement
BRAND
Symbols Logo
Shape
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