Theme 1

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market size
measured either by value (sales revenue) or volume (no. of items sold)
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market share
the amount sold by a single business as a percentage of the total market for the product concerned
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product innovation
occurs when new technologies make it possible to create completely new products or to improve the quality of existing ones
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process innovation
using new tech to improve production methods, so that costs are reduced
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risk
situations where outcomes are known and can be quantified by calculating probabilities
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uncertainty
events are unpredictable - caused by factors outside the control of the business and the possible outcomes cannot be calculated accurately
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product orientation
business focuses its efforts on creating the product rather than responding to the needs of the market - priority is to develop a product and then try to sell it
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market orientation
business will concentrate on customer preferences and decisions will be based on a good understanding of the market, underpinned by extensive research
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market segmentation
refers to the way markets can be divided into segments, each of which has different consumer preferences - product specs and marketing strategies can be designed to fit the preferences of each market segment
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market positioning
examines customers' views on individual products or brands, in relation to each other - may involve variations in price or quality, style or tech features
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product differentiation
occurs when each business creates a distinctive product - may involve giving it unique features in order to attract customers, or it may involve changing perceptions as to the function of the product
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market mapping
a tool that plots brands in the market according to how they meet customers' needs - illustrates the way a business positions its individual products effectively within the wider market
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adding value
when a business increases the worth customers place on a product by improving it or creating a fresh image - allows the business to raise prices
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elasticity
measures responsiveness to change
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PED
measures the extent to which a change in price leads to a change in quantity demanded
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PED formula
% change in QD / % change in price
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price elastic
a price change causes a proportionately bigger change in quantity demanded - % change in QD is greater than % change in P
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price inelastic
a price change causes a proportionately smaller change in quantity demanded - % change in QD is smaller than the % change in P
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YED
measures the responsiveness of QD to a change in income
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YED
measures the responsiveness of QD to a change in income
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Other cards in this set

Card 2

Front

the amount sold by a single business as a percentage of the total market for the product concerned

Back

market share

Card 3

Front

occurs when new technologies make it possible to create completely new products or to improve the quality of existing ones

Back

Preview of the back of card 3

Card 4

Front

using new tech to improve production methods, so that costs are reduced

Back

Preview of the back of card 4

Card 5

Front

situations where outcomes are known and can be quantified by calculating probabilities

Back

Preview of the back of card 5
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