Identifying And Understanding Customers
Overview
An engineer in Chennai spends fourteen months and most of his savings designing a water filter. It is beautiful. It removes more contaminants than anything else at the price, it lasts five years, and it costs 4,200 rupees. He sells eleven of them. The families he built it for buy water in twenty-litre jars because they cannot put 4,200 rupees down at once, and they move house often enough that a fitted filter is a liability rather than an asset. Nothing about the product was wrong. Everything about the question he started from was.
This lesson is about starting from the right question. You will learn what a customer need actually is and why it is not the same as what a customer says they want, see the difference between a business built around its product and one built around its market, and work out how customer needs change when a business moves from a local market to a national or international one. You will also see why the November 2020 Paper 1 offered changes in consumer tastes and preferences as a reason a business might fail, and why that was the answer that scored.
Objectives
- The importance of identifying and satisfying customer needs.
Mind map
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Lesson Note
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Lesson Evaluation
Congratulations on completing the lesson on Identifying And Understanding Customers. Now that youve explored the key concepts and ideas, its time to put your knowledge to the test. This section offers a variety of practice questions designed to reinforce your understanding and help you gauge your grasp of the material.
You will encounter a mix of question types, including multiple-choice questions, short answer questions, and essay questions. Each question is thoughtfully crafted to assess different aspects of your knowledge and critical thinking skills.
Use this evaluation section as an opportunity to reinforce your understanding of the topic and to identify any areas where you may need additional study. Don't be discouraged by any challenges you encounter; instead, view them as opportunities for growth and improvement.
- Which one of the following might cause a business to fail? A. An increase in the number of its employees B. A fall in the cost of its raw materials C. Changes in consumer tastes and preferences D. An improvement in its customer service Answer: C
- Which one of the following best describes a market orientated business? A. One that designs its products around what it is best at making B. One that designs its products around what customers need C. One that sells only in its local market D. One that always charges the lowest price Answer: B
- A business surveys 500 people and 35 per cent say they would buy its product. How many people said they would buy it? A. 35 B. 143 C. 175 D. 350 Answer: C
- Which one of the following is most likely to differ between customers in a business's home country and customers abroad? A. The cost of the business's own raw materials B. The wages the business pays its own staff C. Product safety and labelling requirements D. The business's own production method Answer: C
- Which one of the following is the main risk of a product orientated approach? A. The product may be of poor quality B. Money is spent developing something customers may not want C. The business cannot advertise the product D. The business will have too many customers Answer: B
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