Business Studies

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– Services → provided to customers are intangible.

– Product range → the different designs and specifications of a product that a business sells (coca zero, light, normal, cherry, etc)

– Product mix → the mix of different products a firm sells in different markets (Sony: Vaio laptops, Walkman multimedia systems, PlayStation games consoles)

– Product differentiation → businesses want to distinguish their products from that of the competition, how?:

→ branding: give a name or symbol to their product or the business as a wholesaler

→ selling the product in more or different types of outlets

→ establish superior after-sales-service

→ increasing quality

– The product life → 4 stages: Birth, Growth, Maturity and Decline

Birth/Introduction → business spends large sums on developing, testing, launching(lancer) and marketing the product. It begins with a small batch of the products and carry out some testing on a small sample of consumers in order to establish wether the product is likely to thrive(prospérer). Product may be adapted or aimed at a new market segment as a result of the feedback from consumers of the initial model or it may be dropped completely. Low profit/losses and cash flow problems are expected during that phase due to the low sales and high costs incurred.

Growth → phase where the sales increase as the product starts to take off due to the effective marketing such as a successful advertising campaign and sales promotion. If test marketing was successful then the product may be rolled out nationally bringing sales growth.

Maturity → product will peak due to increased awareness(connaissance) of the product and the establishment of consumer loyalty. Sales revenue? High. Profits? At their highest. Successful products strive(faire tout son possible) to remain in this phase as long as possible due to the high profits.

Decline → Sales are falling. Product have gone out of fashion or competitors have launched superior products. Business tries to sell off remaining stocks at a low price. Profits made during this phase are low. Business face the decision as to wether to update and reinvent the product or withdraw(retirer) it.

– Boston mix → a way that businesses can analyse and evaluate their product range/mix according to where it is in its life cycle and wether it is in a market with strong grow potential. 4 categories:

Star products → are market leading products in growth markets

Cash cow → products in low growth markets that have a large market share, ex: Big Mac

Question mark/Problem child → products that have a low share of a market with high growth potential, ex: samsung in the smartphones market

Dogs → products that have low market share in a market which is not growing, they’re not worth producing any more due to small profit levels and are dropped from a company’s portfolio.

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4. Marketing.

4.3 Market research.

Market research: process of gathering(rassembler), analysing and presenting information about a specific market, its customers and market trends. It allows businesses to make more informed decisions. The research might include information on:

– Changing customers need in domestics/international markets

– Prices charged by the business and competitors

– Market size in terms of revenue, profits and market share

– Competitors

It allows businesses to gain a competitive advantage over its rivals because it enables the business to adapt to changing market trends.

It can have its limitations → unrepresentative findings and outdated information collected.

Qualitative research: seeks to understand how and why people behave in a certain way through methods such as in-depth interviews, focus groups and observations.

Quantitative research: involves the use of numerical and quantifiable data, such as financial records and government statics, to establish market trends and relationships.

Primary/Field research: the gathering(rassemblement) of data that does not already exist → collection of new and original data. Businesses use sampling methods to statistically valid results from a portion of the population(known as sample).

Main sampling methods are:

– Random sampling → anyone can be chosen for sampling

– Quota sampling → into segments, ex: by age, gender or household income

– Systematic sampling → using methodical system to select the sample, ex: every 10th person in a telephone repertory

– Stratified random sampling → mixture of quota and random sampling

Methods of primary research can include → Questionnaires, Online surveys, Interviews, Observations, Focus groups, Test marketing.

+ relevant data

+ up-to-date information

+ uniqueness of the data → no one else has collected it

+ confidentiality → no one else has access to the data collected

+ control over what and how data is collected

– time consuming process

– expensive → information not readily available

– validity of the data might be questioned

Secondary/Desk research: involves the collection and analysis of information that already exists, from sources such as company annual reports, corporates websites and the news media

+ cheaper, less time-consuming