Learning Intentions Success Criteria

Transcription

1 Topic 1 Learning Intentions I understand why businesses segment their customers in markets. I understand why target marketing is beneficial to businesses. Success Criteria I can describe how businesses segment their customers in markets, eg age, class, gender, income. I can describe how target marketing is beneficial to businesses. 1

2 Marketing Marketing involves trying to meet the needs and wants of customers. It does this by finding out what they want and providing this at a price that can make a profit. 2

3 Markets Goods and services are supplied to customers in a market. A market is where customers (the buyer) and sellers (the supplier) come together. A market can exist in a number of places, for example: On a website: the seller sells products online for customers to buy (eg Tesco online shopping or ebay). This is often referred to as e-commerce or e-business. In a shop: the seller has products on shelves for customers to look at and buy (eg in a newsagents). Over the telephone: the seller might telephone a customer to encourage them to buy something (eg double glazing). Through an internet-enabled telephone or tablet computer: the seller might have an application (an app) that customers can access, search for a product and then buy it (eg Dominos pizza or Odeon cinema tickets). 3

4 The Importance of Marketing Marketing is an important activity because it can: attract new customers by letting them know about the range of products the business has allow the business to enter new markets (eg using the internet to sell a product on the other side of the world) help the business grow by entering new markets increase the amount of profit a business makes. 4

5 The Role of Marketing Marketing can help a business increase the number of customers buying from the business (market growth). This will help them to increase the proportion of customers it has from the whole market (market share), and if they have the most customers compared to other businesses in the same market, they can become market leader. 5

6 The chart below shows the market share for UK fixed broadband providers in BT/EE was the market leader with a market share of 33%. If this figure was to get bigger, for example grow to 40%, this would show that BT/EE has increased the number of customers it has for fixed broadband and would therefore have achieved market growth. Of course, if BT/EE increased its market share, this would mean that another business would have decreased its market share (ie lost customers). 2016/2017 Broadband Providers 13% 31% 23% 33% BT/EE O2/Three Vodafone/Virgin Media Others 6

7 Market Segments are important stakeholders as they buy goods and services from a business. Businesses often focus their product towards a specific group of people. This is known as their target market or market segment. 7

8 Why are markets segmented? Reason To make sure the product is suitable and specific to the needs of the customer group. To make sure that the product is sold in the most suitable place where the customer can access it. Higher prices can be charged for products that are seen to be of a higher quality and therefore the business would make more profit. To make sure advertising and promotion campaigns are targeted towards the correct customer group. Why is it important? The product will not sell if it is not what the customer wants nor meets their requirements. The product will not sell if the customer is unable to purchase it in a place convenient to them. So that a price can be set that will reflect the market segment. Money would be wasted on promoting products to the wrong market segment and no sales would be made. 8

9 Examples of Market Segments Gender Age Occupation Religious or cultural belief Income/social class Geographical location Lifestyle 9

10 Gender What it is Segmenting by gender means to market a product towards a specific gender, eg male or female. Example A perfume could be designed in two variations: one for men and one for women. 10

11 Age What it is Segmenting by age means to market a product towards people of a certain age group. Example A holiday could be designed for people who are years old. 11

12 Occupation What it is Segmenting by occupation means to market a product towards people who do a particular job. Example A stethoscope is designed for doctors, nurses and other health care professionals. 12

13 Religious or Cultural Belief What it is Segmenting by religious or cultural belief means to market a product towards people who follow a specific religious or cultural faith. Example Halal meat for people who are Muslim. 13

14 Income/Social Class What it is Segmenting by income or social class means to market a product towards people who have a certain level of income or belong to a particular social group (eg working class or upper class). Example Supermarket own brands, eg Tesco Value brand, is aimed at people with a low income whereas Tesco Finest is aimed at people with a higher income. 14

15 Geographical Location What it is Segmenting by geographical location means to market a product towards people who live in a particular location. Example The climate and temperature in a country will determine the type of clothing sold, eg warmer clothing for colder countries! 15

16 Lifestyle What it is Segmenting by lifestyle means to market a product towards people who lead a particular life, eg whether they are into sport and fitness. Example Lucozade sports drinks are aimed at people taking part in exercise to provide them with energy. 16

17 Activity Complete Marketing worksheet. 17