Podcast
Questions and Answers
What type of innovation is exemplified by Thomas Edison’s invention of the lightbulb?
What type of innovation is exemplified by Thomas Edison’s invention of the lightbulb?
- Transformation
- Invention (correct)
- Extension
- Overlay
What is one of the primary roles of entrepreneurs in the economy?
What is one of the primary roles of entrepreneurs in the economy?
- Create new businesses (correct)
- Discourage innovation
- Reduce competition in the market
- Focus solely on profit
Which of the following statements reflects a second-order implication entrepreneurs should observe?
Which of the following statements reflects a second-order implication entrepreneurs should observe?
- Ignore public feedback and focus on internal opinions
- Validate changes based on hunches alone
- Identify current trends without further analysis
- Observe a change and identify a second-order implication (correct)
Which option best describes a characteristic of extension innovation?
Which option best describes a characteristic of extension innovation?
Which approach should entrepreneurs take when focusing their search for innovation?
Which approach should entrepreneurs take when focusing their search for innovation?
What is defined as the consumers having sufficient interest in a product?
What is defined as the consumers having sufficient interest in a product?
Which market classification includes consumers with interest, income, and access?
Which market classification includes consumers with interest, income, and access?
What does customer lifetime value represent?
What does customer lifetime value represent?
The total market potential can be calculated by multiplying potential buyers, average quantity purchased per buyer, and which other factor?
The total market potential can be calculated by multiplying potential buyers, average quantity purchased per buyer, and which other factor?
What does the chain-ratio method primarily involve?
What does the chain-ratio method primarily involve?
Which market definition refers to the actual buyers of a product?
Which market definition refers to the actual buyers of a product?
What is market potential described as?
What is market potential described as?
In which market does the concept of customer lifetime value play a critical role?
In which market does the concept of customer lifetime value play a critical role?
What is the primary purpose of setting a sales quota?
What is the primary purpose of setting a sales quota?
How is Quality Function Deployment (QFD) primarily used?
How is Quality Function Deployment (QFD) primarily used?
What is typically included in the House of Quality (HOQ) matrix?
What is typically included in the House of Quality (HOQ) matrix?
In the context of sales budgeting, what does a conservative estimate refer to?
In the context of sales budgeting, what does a conservative estimate refer to?
Which method is NOT commonly used in constructing QFD matrices?
Which method is NOT commonly used in constructing QFD matrices?
What is the primary purpose of creating a customer or buyer persona?
What is the primary purpose of creating a customer or buyer persona?
Which market targeting strategy focuses on common needs shared by the market?
Which market targeting strategy focuses on common needs shared by the market?
What is the main goal when using a Needs-Benefits Map in market analysis?
What is the main goal when using a Needs-Benefits Map in market analysis?
In what way do Positioning Maps help businesses?
In what way do Positioning Maps help businesses?
Which of the following is NOT considered a factor in segment attractiveness?
Which of the following is NOT considered a factor in segment attractiveness?
What characteristic defines differentiated marketing?
What characteristic defines differentiated marketing?
What insight is gained by understanding customer purchasing decisions?
What insight is gained by understanding customer purchasing decisions?
Which of the following is a benefit of using market-specific needs in targeting strategies?
Which of the following is a benefit of using market-specific needs in targeting strategies?
Which research method is considered the most scientifically valid?
Which research method is considered the most scientifically valid?
What is the primary purpose of using surveys in market research?
What is the primary purpose of using surveys in market research?
The KANO model is useful for which of the following purposes?
The KANO model is useful for which of the following purposes?
What aspect differentiates observational research from other research methods?
What aspect differentiates observational research from other research methods?
What is a key benefit of the House of Quality (HOQ) in market research?
What is a key benefit of the House of Quality (HOQ) in market research?
Which type of research method is best suited for descriptive research?
Which type of research method is best suited for descriptive research?
What is the main focus of conducting experimental research?
What is the main focus of conducting experimental research?
In the context of market research, what is the significance of the Completeness check?
In the context of market research, what is the significance of the Completeness check?
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Study Notes
Demand Forecasting
- Potential Market: Consumers showing interest in a product.
- Available Market (TAM): Consumers with interest, financial capacity, and access.
- Target Market (SAM): The segment of the available market that is qualified and reachable.
- Penetrated Market (SOM): Actual buyers who have made a purchase.
Customer Lifetime Value
- Represents the total revenue generated from a customer throughout their relationship with a business.
Market Potential
- Defined as the maximum sales available to all firms in an industry over a certain period, given a specific marketing effort.
- Calculated using the formula:
- Total Market Potential = (Potential Number of Buyers) × (Average Quantity Purchased by a Buyer) × (Price)
Chain-Ratio Method
- A forecasting technique that multiplies a base number by adjusting percentages to estimate future market potential.
Role of Entrepreneurs
- Entrepreneurs create new businesses, provide job opportunities, and contribute to national income.
- They initiate social change, increase productivity, and address issues like poverty.
- Key entrepreneurial actions include:
- Observing market changes.
- Identifying opportunities from second-order implications.
- Focusing on areas of interest and leveraging personal experiences.
Types of Innovation
- Invention: Introduction of a completely new product or service (e.g., Edison’s lightbulb).
- Extension: New applications of existing products/services (e.g., Facebook's various uses).
Entrepreneurial Decision Making Considerations
- Assess segment attractiveness and fit with company objectives.
- Develop customer or buyer personas to identify needs and behaviors.
- Utilize positioning maps to visualize brand perceptions against competitors.
Market Targeting Strategies
- Undifferentiated Strategy: Targets the entire market with a single offer (mass marketing).
- Differentiated Strategy: Targets multiple market segments with tailored offers.
Sales Effort Setting
- Sales Quota: The desired sales level set for a product line or sales representative.
- Sales Budget: An estimate of expected sales volume, aiding financial planning.
Quality Function Deployment (QFD)
- A structured approach to converting customer requirements into product specifications.
- Uses matrices, such as the House of Quality (HOQ), to facilitate group discussions and decision-making.
Market Research Approaches
- Observational Research: Collects fresh data by observing behaviors and settings.
- Experimental Research: Involves controlled tests to determine the effects of variables.
- Surveys: Gather insights on consumer knowledge, beliefs, and preferences using structured questionnaires.
KANO Model
- Helps decode customer needs and transforms feedback into actionable insights for product development through QFD.
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