Market Analysis

Market orientation 
When firms base their planning on the customers needs and wants this can be based on trailing and testing. 


Product orientation 
When firms based their planning on its own requirements, it doesn't base any of its decisions on customers. 


Asset-led marketing 
When a firm bases its planning on customer needs and wants and its own strengths. 


Adding Value
A company bases it prices in relation to the benefits it may have for the business. When a business adds value is  the amount of benefits something will have in comparison to its price. This means that it doesn't necessarily have to be cheap but if it is good value for money then it will be worth it for the customer. 








Sales of the product  X 100% 

Total market size 

Markets 

• Market-Any place or process bringing buyers and sellers with a view to agreeing a price. 
• The bases of how an economy operates- through production and subsequent exchange. 

The difference between a Geographical and non-geographical market? 

Considerations for starting business in a market

• Types of market 
• Size of the market 
• Cost of resources/ overall costings
• Marketing mix( Product, price, place, promotion) 
• Pricing strategies
• Promotion 
• Distribution 
• E-commerce( selling online) 
• Cost to break-even 
• Target Market 
• Advertising- sponsorship 
• Tax implications
• Promotional activities- Above/ bellow the line 
• Running cost e.g. Electricity, Gas, Water
• Copywrite 
• Customer Satisfaction- Measured through quality
• Morals/ ethics(fair trades) 
• Stakeholders e.g. Government, community, customers
• Wages for staff/ training of staff(minimum wage) 
• Laws- health & safety, government laws (discriminantion) 

Entrepreneur- A person who is willing to take risk to ensure the success of their business.

Examples of Entrepreneurs: 
Alan Sugar 
Richard Branson 
Bill Gates 


Market Analysis 
Niche in the market 
Competitors
Market Share/ Market Growth 
Time periods 
Investigator Price 
Start up, market cost ( product/price) 
Bank Conditions(Economy) 

Effects recession has on smaller business' 

• Less competotrs 
• less profit/ lower prices 
• less investments 
• Smaller variety of products 
• less customers 
• lack of demand 
• more cost (overheads, running cost) 
• change pricing strategies 
• more likely for banks not to lend 
• more owner's funds used 
• higher failure rate (75% of smaller businesses fail) 
• resources more expensive 
• prices for supplies increase 
• less trade credit- minimize risk 

Business start-up 

1. passion/hobbie 
2. to make a profit 
3. gap in the market 
4. work on hours 
5. own boss (independance) 
6. Improve circumstances 
7. Enjoy feeling of risk 
8. Cashing in on a business idea 
9. Discovery of a gap in the market 
10. Providing assistance to the economy 
11.  New business idea- provide a legacy 
12. Jobs for unemployed 

Possible problems with ( start-up) 

• Lack of investment 
• Competitors(too much competition) 
• Lacks of risks 
• Location 
• Inflation( prices to high) 
• lack of security 
• employment 
• market mix( product, prices, place & promotion) 
• Marketing 
• Economies of scales 

Customers & Sales- Big vs Small 

Small 

• Smaller cost 
• Lower tax rate 
• Less variety 
• less sales 
• Better quality product( job production)
• More customer loyalty 

Big 

1. Larger income 
2. Higher tax rate 
3. More sales 
4. Retain smaller percentage of profit 
5. Higher market shares 

The size of the market 

• Profits made by business 
• Market share of business
• Value of Sales 
• Number of employees
• Volume of sales

A large market means lots of potential customers.

 A small market means potential profits could be limited. 

Market Share & market growth

Market share- Worked out as a percentage.

Firms with large market shares have greater power over suppliers and distributions.

They can demand preferential treatment & better rates.

Market growth

• Market growth refers to an increase in the size of the market for a particular product. 

If the market is shrinking, how would it effect competitors? 

• Less competition 
• Fierce competition 
• Larger opportunity profit 
• Price increases 
• Liquidation of companies 
• Less room for venture

Why enter a growing market?

More chances of success 

More money to be made 

Higher demand 

Less fierce competition 

Less chance of failure

Benefit from economies of scale more

Room for expansion 

Expansion 

• Company develops 
• Overseas(multi-national) 
• More products 
• Sales increase 
• More customers 
• More employees 
• Location 
• More brand awareness
• More accessible 

Market Segments 

• A market segment is an identifiable group with similar needs and want wants within a market. 

Examples:- Age- Based on a particular age group e.g. over 18's 

1. Gender- Differs between male & females and unisex
2. Income- E.g. Rolex and Porsche highly priced 
3. Socio- economic groupings- Based on income and jobs e.g. A,B,C,D,E
4. Demographics- Area you live in (Poverty/rich area) Religion
5. Purchase occasion- Bought on occasion e.g. flowers, birthday cards. 

Eurozone Crisis

Many people around Europe have fears that the EuroZone is likely to collapse but there is more likely speculation that the EuroZone will go into a recession one again. Some reports from Sky News suggest that there will only be a 0.1% growth for the whole of the next year as well as unemployment rising to 10% before 2015. The article also highlights that the Euro has fell to 84 pence against the pound and $1.30 against the Euro.

There are additional fears amidst the European Conference as Britain was the only country out of 27 countries not to sign the treaty for tighter regulations around Europe. This had affects around the remaining of the world as Asian markets were down on average by 1.7% relating to concerns about the result of the treaty. Country around the world fear that because a treaty wasn't signed it may cause more problems in terms of trade around the world as Europe debt may further increase.