The "Comprehensive IGCSE Business Studies Definitions Handbook" is an indispensable resource designed to support students, in mastering the fundamental concepts of business studies at the IGCSE level. It covers Section 3 of the IGCSE syllabus
Section 3 revision keywords and questions
Key terms Definition/example/answer
The 4 elements of marketing four Ps – product, price, place and promotion
» Consumer tastes and fashions change
3 reasons why consumer » Changes in technology
spending patterns have » Change in incomes
changed
What is a niche market A niche market is a small, usually specialised, segment of a
much larger market.
Advantage » Small businesses may be able to sell successfully
in niche markets as larger businesses may not have identified
them but concentrated on the mass markets instead.
Advantage » The needs of consumers can be more closely
focused on, and therefore targeted, by businesses in a niche
What are two advantages and market
two disadvantages of a niche
market Disadvantage » Niche markets are usually relatively small and
therefore have limited sales potential.
Disadvantage » Often businesses in a niche market will
specialise in just one product. This means that if the product is
no longer in demand the business will fail as the business has
not spread its risks.
What is a mass market Mass market is where there is a very large number of sales of a
product.
What are two advantages and
two disadvantages of a mass Advantage » total sales in these markets are very high.
market
,Classification: Internal
18
Advantage » risks can be spread, as often the business will sell
several different variations of products to the mass market.
Disadvantage » high levels of competition between businesses
selling similar product.
Disadvantage » high costs of advertising and promotion
Market segmentation is when a market is broken down into
What is market segmentation sub-groups which share similar characteristics.
»By age
What are 4 ways the market »By gender
can be segmented »By the use of the product
»By lifestyle
» Make marketing expenditure cost effective by producing a
product which closely meets the needs of these customers and
What are two benefits of targeting its marketing efforts only on this segment.
market segmentation to a
business » Identify a market segment which is not having its needs fully
met, and therefore offers opportunities to increase sales.
Primary research is the collection and collation of original data
What is primary research
via direct contact with potential or existing customers. (Also
called field research.)
» Questionnaires
What are 4 examples of
» Online surveys
primary research
» Interviews
» Focus groups
Advantage » It is up to date and relevant to the business
What is an advantage and
undertaking it.
disadvantage of primary
research?
Disadvantage » It can be expensive, for example, individually
interviewing many people.
Secondary research uses information that has already been
What is secondary research
collected and is available for use by others. (Also called desk
research.)
,Classification: Internal
19
» Government statistics
What are 4 examples of » Newspapers trade association
secondary research » Market research agencies
» trade association
Advantage » Often a much cheaper way of gathering
information than primary research, as the data collection has
What is an advantage and
already been done by others.
disadvantage of secondary
research?
Disadvantage » Data may have been collected several years
ago and be out of date.
A marketing budget is a financial plan for the marketing of a
product or product range for some specified period of time. It
Marketing budget
specifies how much money is available to market the product
or range, so that the Marketing department knows how much it
may spend.
Product orientation A product-orientated business is one whose main focus of
activity is on the product itself
A market-orientated business is one which carries out market
Market orientation research to find out consumer wants before a product is
developed and produced.
Qualitative data Qualitative data, which answers questions where an opinion or
judgement
Quantitative data Quantitative data, which answers questions about the quantity
of something
A sample is the group of people who are selected to respond to
Sample
a market research exercise, such as a questionnaire.
A random sample is when people are selected at random as a
Random sample
source of information for market research.
A quota sample is when people are selected on the basis of
Quota sample
certain characteristics (such as age, gender or income) as a
source of information for market research
4 factors influencing the » How carefully the sample was drawn up.
accuracy of market research » The wording of the questions» who carried out the research.
data » Age of the information
» Bias
, Classification: Internal
20
3 ways you can present » A table or tally chart
market research results » A chart
» A graph
The marketing mix is a term which is used to describe all the
The marketing mix activities which go into marketing a product or service. These
activities are often summarised as the four Ps – product, price,
place and promotion.
5 stages in the product life
cycle
Extension strategy is a way of keeping a product at the maturity
Extension strategies
stage of the life cycle and extending the cycle
»Introduce new variations of the original product.
3 examples of extension » Sell into new markets, e.g., export the product to another
strategies country.
»Introduce a new, improved version of the old product.
» The costs of producing trial products, including the costs of
2 costs of developing new
wasted materials.
products
» The lack of sales if the target market is wrong.
» Unique Selling Point (USP) will mean the business will be first
2 benefits of developing new
into the market with the new product.
products
» Diversification for the business, giving it a broader range of
products to sell.
Brand image is an image or identity given to a product which
Brand image
gives it a personality of its own and distinguishes it from its
competitors’ brands.
The brand name is the unique name of a product that
Brand name
distinguishes it from other brands.
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