Understanding Markets AS Business Studies

Aims and Objectives Aim: Understand market share, size and growth Objectives: Define market share, size and growth Calculate market share and growth Analyse changing market share and growth Evaluate changing market shares

Starter Define segmentation. Give a benefit of market segmentation. Define market mapping. What does market mapping allow an entrepreneur to identify?

Success of Marketing Depends On.. Demand is determined by the following: – Competition – the actions of competitors – Price – some products demand will change with price changes – Incomes – some products demand will change with income changes – Marketing – relationship between amount of money spent on marketing and sales – External factors – state of economy

Market Share The proportion of a total market accounted for by one product or company.

Market Share Sports Industry

Market Share High End Fashion

Calculate Market Share Total Sales Of Firm X 100 Total Sales of Industry

Calculate Market Share CompanySales £Market Share Hendersons125,000 Williamson250,000 Bryant200,000 Toppings50,000 Total625,000100%

The measurement of the change in market size, usually expressed as a percentage of its original size. Market Growth

How much value of market has changed The original value of the market Market Growth X 100

Original value of market £425,000 New value of market £570,000 Calculate market growth Market Growth

Original sales £20,000 New sales £27,000 Calculate market growth for the firm Market Growth of Business

The measurement of the size of total sales for a whole market expressed in terms of value of sales or volume of sales (units). Market Size

Worksheet Market Size, Growth and Share

Sales in 2007 Market Share in 2007 Sales in 2008 Market Share in 2008 % Change in Sales between 2007 and 2008 Hendersons90, ,000 Williamson210, ,000 Bryant190, ,000 Toppings60,000 50,000 Total550,000100%625,000100%

StatementTrue or False? Henderson’s sales have fallen. Henderson’s sales have risen. Henderson’s market share has fallen. Henderson’s market share has risen. The market as a whole has grown at a greater rate than Henderson’s sales. The market as a whole has grown at a slower rate than Henderson’s sales. Henderson’s market share has grown by 4 percentage points. Henderson’s market share has grown by 39%. Henderson’s and Williamson’s sales have grown at a faster rate than the market as a whole. Hendersons’ has the biggest market share in Bryant’s sales have grown by 5%. Bryant’s market share had risen by 3%

What problems may a business face if it is losing market share? What opportunities may there be of a business which has an increasing market share? EV: Market Share Issues & Opportunities