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A business sells luxury cars - HSC - SSCE Business Studies - Question 21 - 2019 - Paper 1
Question 21
A business sells luxury cars. The cars are stylish, high performance and include advanced safety features integrating leading edge technology. (a) Describe ONE fact... show full transcript
Worked Solution & Example Answer:A business sells luxury cars - HSC - SSCE Business Studies - Question 21 - 2019 - Paper 1
Step 1
Describe ONE factor influencing customer choice for this business.
Answer
One key factor influencing customer choice for this business is the perceived status associated with owning luxury cars. Customers from higher social classes are likely to choose high-performance vehicles not only for their functional benefits, such as advanced safety features and stylish design but also for the prestige and recognition that comes with owning a luxury brand. The social influence of peers and family may further motivate individuals to opt for high-end vehicles as a reflection of their success and lifestyle.
Step 2
Explain the interdependence between marketing and finance for this business.
Answer
Marketing and finance are interdependent functions crucial for the success of the business. Marketing strategies often require budget allocation, meaning that financial insights are essential for effective planning. For instance, finance provides the necessary funds to execute marketing campaigns that aim to attract potential customers. Conversely, the sales generated from successful marketing efforts increase revenue, which in turn allows for reinvestment in both marketing and operational costs. This mutual reliance ensures that the business can achieve its objectives efficiently.
Step 3
Why is it important for this business to conduct market research?
Answer
Conducting market research is vital for this business as it enables informed decision-making. Through research, the business can gather valuable insights into customer preferences and market trends, ensuring that its offerings align with consumer demands. Additionally, understanding the competitive landscape helps the business identify opportunities and potential threats. Effective market research aids in reducing risks associated with new product launches or marketing strategies and ultimately supports the achievement of targeted business objectives.