Syllabus: Cambridge - International AS & A Level Business
Module: 3.1 The Nature of Marketing
Lesson: 3.1.3 Markets

Introduction

The Cambridge International AS & A Level Business syllabus section 3.1.3 covers Markets as part of “The nature of marketing”. This topic helps students understand how markets are defined, segmented and targeted, and the different types that exist locally, nationally, and globally. For teachers, this unit bridges theory with application, as it examines how businesses position themselves and make strategic decisions based on market dynamics. It directly connects to wider business strategy topics, making it a foundational area for both exam success and real-world business literacy.

Key Concepts

• Definition of a market: Where buyers and sellers come together to exchange goods and services.

• Types of markets:

  • Consumer markets (B2C)

  • Business-to-business markets (B2B)

  • Local, national, and international markets

  • Niche vs mass markets

• Market segmentation: Dividing a market based on demographic, geographic, psychographic, and behavioural factors.

• Targeting and positioning: Selecting a segment to serve and differentiating the product or service.

• Market growth and share: Measuring market trends and a firm’s performance relative to competitors.

• Dynamic nature of markets: Impact of technology, social trends, and globalisation on market structures.

Real-World Relevance

In 2024, the UK electric vehicle (EV) market saw rapid growth, with Tesla focusing on the premium niche while brands like MG targeted budget-conscious consumers. This illustrates segmentation, targeting, and positioning in action. Similarly, the post-pandemic boom in online grocery shopping shows how external factors can shift market demand and create opportunities for both established and emerging players. Students can relate these examples to local markets, such as food delivery services adapting to changing consumer routines.

How It’s Assessed

Assessment for this section in Cambridge International AS & A Level Business typically involves:

• Data response questions: Interpreting market data, charts, or case studies.

• Short-answer questions: Defining terms like “market share” or “niche market”.

• Essay questions: Discussing benefits and drawbacks of targeting niche vs mass markets.

• Application-based scenarios: Analysing how a business might respond to changing market conditions.
  Command words such as analyse, evaluate, and recommend require students to not only recall definitions but also apply concepts in context and justify decisions.

Enterprise Skills Integration

Using Enterprise Skills’ Business Simulations, students can be placed in a competitive virtual market, making real-time decisions on pricing, promotion, and product selection. This hands-on approach allows them to see how segmentation and positioning affect market share and profitability. Skills developed include:

• Strategic decision-making under time pressure

• Analysing market data to adjust tactics

• Problem-solving when market conditions shift unexpectedly

Careers Links

This topic links to Gatsby Benchmark 4 (Linking curriculum learning to careers) and Benchmark 5 (Encounters with employers):

• Roles such as Marketing Executive, Market Research Analyst, Product Manager, and Business Development Officer directly use these concepts.

• Understanding markets is also essential for entrepreneurs, consultants, and policymakers.

• Skills in segmentation and targeting are highly valued in digital marketing roles, particularly in analytics and customer engagement.

Teaching Notes

• Time-saving approach: Use case studies from familiar brands (e.g. local retailers, school suppliers) to make segmentation and targeting tangible.

• Common pitfalls: Students often confuse segmentation bases (e.g. demographic vs psychographic) and misinterpret market share data. Provide scaffolded exercises to address this.

• Extension activities: Have students research and present a company’s target market strategy, including how it may adapt over the next five years.

• Cross-topic links: Connect this topic with operations (product decisions) and finance (budget allocation for marketing).