The Market
Define mass market
A market aimed at a large group of consumers with similar needs.
Define primary research.
Collecting first-hand data directly from consumers.
Define market share.
Percentage of sales in a market held by one business.
A bakery surveys 50 local customers. Is this primary or secondary research?
Primary research.
Why might businesses misinterpret market research data?
Poor sampling, biased questions.
A smaller segment of a larger market with specialised needs.
Define secondary research.
Using existing data collected by others.
Define quantitative data.
Numerical data (e.g. survey statistics).
A business uses government census data. Is this primary or secondary research?
Secondary research.
Why is market research important before launching a new product?
Reduces risk, ensures customer needs are met.
Give one benefit of targeting a niche market.
Less competition / can charge premium prices.
Give one advantage of primary research.
Up-to-date and specific to business needs.
Define qualitative data.
Descriptive data on opinions/attitudes.
Give one example of how a clothing retailer might use market segmentation.
Segment by age, income, or fashion preferences.
Analyse one drawback of relying only on secondary research.
Data may not reflect current consumer trends.
Explain what is meant by a dynamic market.
A market that changes frequently due to innovation and consumer tastes.
Explain one limitation of secondary research.
May be outdated or not specific to the business.
Define sampling.
Selecting a group of consumers to represent the target market.
A new café uses online reviews to understand customer needs. What type of research is this?
Secondary research.
Evaluate: “Market research guarantees business success.”
Reduces risk but doesn’t guarantee success; depends on execution.
Evaluate: “Businesses should always aim for mass markets rather than niche markets.”
Depends on competition, resources, growth potential, consumer preferences.
Evaluate whether small businesses should rely more on primary or secondary research.
Primary = accurate but costly; Secondary = cheaper but less tailored.
Define bias in research.
When data is not accurate or representative due to poor design or sampling.
A small start-up has limited funds. Should they use random sampling or quota sampling? Explain.
Quota sampling – cheaper and more practical.
Debate: “In fast-changing markets, businesses should spend less on research and more on innovation.”
Depends on speed of change, industry type, and resources.