the market - theme 1


mass market and niche market definitions

Mass market: market which is aimed at the general population

Niche market: this is a segment of the main market and addresses a specialist need for specific customers

1 of 9

mass market pros and cons


  • large scale production means economies of scale and lower average unit costs
  • mass marketing is easy and straightforward as everyone is targeted in the same way
  • larger volume of sales so higher revenues


  • lots of competition
  • expensive as homogenous products need to be differentiated through marketing
  • high volume production not flexible to demand changes
2 of 9

niche market pros and cons


  • charge premium price
  • easier to target customers
  • small scale production can be flexible and follow trends
  • less competition than in the mass markets


  • very risky as demand may not be constant
  • higher unit costs so no economies of scale
3 of 9

market size and market share

market size can be measured through:

- volume of sales, or physical quantity of products sold

- value, total amount spent by customers

market share is the proportion of a market that is taken by a business, product or brand.

calculation: sales of x divided by total sales in whole market X100

4 of 9


branding is important in mass markets as it instils loyalty in customers due to products being the same and needing to appear different

5 of 9

dynamic markets

dynamic markets are subject to rapid or continuous change for example, shoes

online retailing is a dynamic market as it is constantly changing and expanding to give customers new products or new ways to shop. some online retailers have shops as well.

6 of 9

pros and cons of online retailing


  • shop is open around the clock
  • orders can be taken automatically without the need of staff
  • shop can reach international markets easier
  • low overheads no need for shop premises
  • stock can esily be withdrawn or updated to keep up with dynamic market changes or tastes
  • easy to set up
  • flexible - owner can be anywhere in the world
  • opportunities for fast growth


  • 71% of customers still prefer to browse online then purchase in a shop
  • issues with sending goods back may put customers off
  • issues with online security can put people off - especially elderly
  • very competitive market
  • owners need IT skills
  • problems with fraud / spam / viruses
  • competitors can be aware of owners business model, prices and activity
7 of 9

competition and the market

very competitive markets benefit the consumers in many ways:

  • more competition means the business needs to be very efficient
  • need to listen to consumers wants and needs a lot more and strive to meet these instead of being product orientated
  • bust be less wasteful
  • must product a good quality or service
  • must use promotions or other non - priced factors to persuade customers to switch
8 of 9

difference between risk and uncertainty


  • when the potentional outcomes of a decision are known


  • none of the outcomes are known in advance
9 of 9


No comments have yet been made

Similar Business resources:

See all Business resources »See all theme 1 resources »