3.1 Marketing, Competition and the Customer

IGCSE Business Studies (0450)


2026 Syllabus Objectives

By the end of this topic, you should be able to:

3.1.1 The Role of Marketing

  1. Explain what it means to identify customer needs
  2. Explain what it means to satisfy customer needs
  3. Explain how businesses maintain customer loyalty
  4. Describe how businesses build customer relationships

3.1.2 Market Changes

  1. Explain why customer spending patterns may change
  2. Explain the importance of changing customer needs
  3. Explain why some markets have become more competitive
  4. Describe how businesses can respond to changing spending patterns and increased competition

3.1.3 Niche Marketing and Mass Marketing

  1. Describe the benefits and limitations of both approaches

3.1.4 Market Segmentation

  1. Explain how markets can be segmented (e.g. age, income, location, gender)
  2. Describe the potential benefits of segmentation to a business
  3. Recommend and justify an appropriate method of segmentation in a given situation

3.1.1 The Role of Marketing

What is Marketing?

Marketing is the process a business uses to find out what its customers want — and then make sure those customers get it. Think of marketing as a bridge between a business and its customers. It is not just about advertising; it covers everything from discovering what people want, to setting the right price, to making sure products are available in the right place.

Most medium and large businesses have a marketing department made up of several teams:

  • Sales team — responsible for actually selling the products to customers
  • Market research section — finds out what customers need, how the market is changing, and what competitors are doing
  • Promotion section — plans and organises advertising campaigns
  • Distribution — makes sure products are transported and delivered to the right places

Identifying Customer Needs

Before a business can sell anything successfully, it must first find out exactly what its customers want. This is called identifying customer needs.

To identify customer needs, a business needs to find out:

  • What types and quality of goods or services customers want to buy
  • How much money customers are willing to pay (the price they expect)
  • What kind of promotions or advertising might convince them to buy — and keep buying
  • Where and how customers prefer to buy (for example, in a shop, online, or through an app)
  • What after-sales services customers expect (for example, warranties, customer support, or return policies)

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