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Read the information supplied and answer the questions which follow: Maria's Design Knitwear Ltd Maria has always loved designing and knitting clothes for family and friends - Leaving Cert Business - Question 6 - 2011

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Question 6

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Read the information supplied and answer the questions which follow: Maria's Design Knitwear Ltd Maria has always loved designing and knitting clothes for family a... show full transcript

Worked Solution & Example Answer:Read the information supplied and answer the questions which follow: Maria's Design Knitwear Ltd Maria has always loved designing and knitting clothes for family and friends - Leaving Cert Business - Question 6 - 2011

Step 1

What is meant by 'the advantage of limited liability' as referred to above?

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Answer

The advantage of limited liability refers to the legal protection it provides to shareholders of a company. In the event that the business fails or becomes bankrupt, the shareholders can only lose the amount they have invested in the company. They are not personally liable for the debts incurred by the business, meaning their personal assets, such as property, cannot be pursued by creditors.

Step 2

Explain the following market research terms and give one example of each:

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Answer

(i) Field research

Field research involves gathering information directly from potential customers in the marketplace. It often includes methods such as surveys, interviews, and observations to understand customer preferences and behaviors. For example, conducting surveys in local boutiques to gather feedback on Maria's products would be considered field research.

(ii) Desk research

Desk research involves analyzing existing information that has already been collected by other sources. This could include studying market reports, academic articles, or online databases. An example of desk research would be examining sales data available from government statistics or industry reports.

Step 3

Outline two benefits to Maria of having a brand name for her knitwear.

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Answer

  1. Product Differentiation: A brand name helps to distinguish Maria's knitwear from competitors' products, making it easier for customers to recognize her offerings in the marketplace.

  2. Customer Loyalty: A strong brand name can lead to customer loyalty, as customers are likely to return for repeat purchases if they have a positive association with the brand.

Step 4

Explain one function of advertising.

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Answer

Advertising serves to inform potential customers about a product or service. It communicates key information such as product features, benefits, and pricing, thereby influencing consumer decisions and driving sales. For instance, advertising can encourage customers to try Maria's knitwear by highlighting its unique designs.

Step 5

Describe three advertising media that Maria might consider.

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  1. Print Media: This includes local newspapers and magazines where advertisements can reach a specific audience. For example, ads in craft or fashion magazines would target potential customers interested in handmade clothing.

  2. Electronic Media: Television and online platforms can be used to showcase Maria's products with visual advertisements. This medium allows for a broader reach as it can attract a diverse audience.

  3. Social Media: Platforms like Instagram and Facebook are essential for marketing products visually and engaging directly with potential customers, allowing for immediate feedback and interaction.

Step 6

What is meant by the term 'target market'?

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Answer

The target market refers to a specific group of consumers that a business aims to reach with its products or services. These individuals share common characteristics such as age, gender, income level, or interests. By understanding their target market, businesses can tailor their marketing strategies effectively.

Step 7

Name one example of a target market.

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Answer

One example of a target market could be athletes who are looking for high-performance clothing, such as energy drinks or nutritional supplements designed to support their training and competition needs.

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