Pearson Edexcel Business As-Level Complete Revision Notes
Unit 1: Marketing & People
(Paper code: WBS11)
Created by: phenomenotes
Course Structu
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CHAPTER:
1- The Market 3
2- Market Research 7
3- Market Positioning 11
4- Demand 14
5- Supply 17
6- Markets 19
7- Price Elasticity of Demand (PED) 21
8- Income Elasticity of Demand (YED) 24
9- Marketing objectives & strategy 26
10- Product/Service Design 31
11- Promotion & Branding 33
12- Pricing Strategies 37
13- Distribution 40
14- Approaches to staffing 43
15- Recrutment, selection & training 47
16- Organisational Design 52
17- Motivation in theory & practice 56
18- Leadership 61
19- Role of an Entrepreneur 64
20- Entrerpreneurial motives & characteristics 68
21- Business Objectives 70
22- Business Choices 73
Business Terminologies 74
(These boxes may be seen throughout the revision notes.)
CHAPTER 1: THE MARKET
I. Mass markets & Niche Markets
a very large market a smaller market, usually within in which products with a large market/industry.
mass appeal is targeted. e.g., Sensodyne e.g., Colgate
A. Characteristics of:
1. Mass markets
Business sells the same products to all consumers & markets in the same way.
Number of customers is huge-possibly billions of products are sold globally.
Businesses can produce large quantities at lower unit cost by exploiting economies of scale.
Higher competition which leads to more investment in marketing.
Higher sales & profit (low average profit, high total profit)
2. Niche markets
Involves selling to a smaller customer group sometimes with specific needs.
Less/ no competition so they can charge premium prices for new products.
High average profit, low total profit
B. Market size
-size of the market can be calculated by the total sales of all businesses in the market.
-can be estimated in 2 ways:
Value(monetary) Volume-physical quantity of products
-total amount spent by which are produced & sold. consumers buying products.
C. Market share
-the proportion (%) of a market that is taken by a business, product/ brand or
-the contribution of each firm in the total market size, shown as a %.
𝑠𝑎𝑙𝑒𝑠 𝑜𝑓 𝑎 𝑏𝑢𝑠𝑖𝑛𝑒𝑠𝑠
𝑀𝑎𝑟𝑘𝑒𝑡 𝑠ℎ𝑎𝑟𝑒 =
𝑡𝑜𝑡𝑎𝑙 𝑠𝑎𝑙𝑒𝑠 𝑖𝑛 𝑡ℎ𝑒 𝑚𝑎𝑟𝑘𝑒𝑡
× 100%
Example:5 car producers are given with their sales
Toyota=20 Nissan=45 Honda=10 Hyundai=30 Lexus=55 160 is the total sales in the market
45
𝑀𝑎𝑟𝑘𝑒𝑡 𝑠ℎ𝑎𝑟𝑒 𝑜𝑓 𝑁𝑖𝑠𝑠𝑎𝑛 =
D. Brands
160
× 100% = 28%
Uses:
Create customer loyalty
Help product recognition
Develop an image
Charge premium price when the brand becomes strong
II. Dynamic markets
-one that is subject to rapid/ continuous change.
A. Online retailing
-also known as e-tailing/e-commerce
-involves shoppers ordering goods online & taking delivery at home.
Advantages:
o Distance is no object with online retailing.
o Customers can buy the products from anywhere in the world.
o Online retailers can reach more customers. Disadvantages:
o Owners need IT skills.
o Issues with online security worries older customers to share their bank details.
B. How markets change
1. Size of the markets
-when market size increases/decreases then the market become smore dynamic.
-when the market size remains the same, the market become static.
2. The nature of the markets
-when the structure & nature of the market is subject to constant change which will lead to a dynamic market.
e.g., Before people are ordering physically but now, they are ordering via online, the nature of the market change. So, the market becomes dynamic.
3. New markets
-when some markets completely disappear, new markets are always developing. This will lead to people switching their demand from old markets to new markets. Thus, markets will be dynamic.
C. Innovation & Market growth
-higher product innovation & market growth will lead to a more dynamic market.
Factors which will lead to growth of existing markets & new markets:
1. Economic growth
-As global living standards rise this means world’s population ha smore money to spend. Therefore, businesses can supply more of their output to growing global markets which will lead to market growth & a more dynamic market.
2. Innovation
-businesses can grow their market through innovation. They can create new needs & wants & meet them with new products.
3. Social change
-change sin society can have a big impact on markets.
e.g., Increase in the proportion of working women have increased market size for childcare.
4. Changes in legislation
-if the government lift a law that is favorable for the business, production will increase. Hence, there will be market growth.
5. Demographic changes
-changes in the structure of the population can affect the size of the markets. e.g., Increase in the aging population in Japan will lead to increase in market size for healthcare.
D. Adapting to change
-If businesses do not adapt to market changes, they are likely to lose market share.
Factors which can help businesses adapt to market change:
1. Flexibility
-A business might need flexible working practices, machinery & equipment, pricing & staff. This might help businesses to serve customer smore effectively when changes occur.
2. Market research
-Firms need to be aware of any changes in customer needs/taste. Communication with customers & potential customers should be an ongoing process if firms want to be updated.
3. Investment
-Businesses that invest in new product development are likely to survive for longer in the market.
4. Continuous improvement in the increasing competitive environment
-can help businesses to be more adaptable in the market.
e.g., If a business can improve their efficiency, costs will be lower & prices can be reduced.
III. How competition affects the market
Rivalry that exists between businesses in a market.
-competition affects both [Show Less]
