Markets

Markets

Market – where buyers and sellers come together

Marketing – techniques that sellers undertake

Brand – distinguish, differentiate, create image. Beneficial in mass market to be able to charge premium prices

NICHE; small market with specific needs

• Charge premium prices
• Avoid competition
• NOT spreading risk
• Larger firms can easily overrun

MASS; produce in large quantities to mass

• Lower unit cost allowing economies of scale to be exploited
• Higher profit margins
• High advertising costs
• Fierce competition

 

Market size – value/volume. Calculated by total sales of business, fluctuate

Market share – sales/total sales X 100. Market leader influence strategy of others and objectives

ONLINE RETAILING

 

Consumer:

• Global fashion
• 24/7 (USP)
• Distance is no object
• Delivery cost
• Alienate markets, elderly
• Quality

 

Business:

• Save costs
• Global market
• Gather consumer info, be able to use direct marketing
• Website crashes, cause huge losses
• Cannot tap into certain markets

Markets change because of:

• SIZE: grow or shrink affected by PLC
• NATURE: product/service providing, consumer perceptions and trends
• NEW: develop with technology

 

How businesses can adapt to change:

• Develop a niche
• Continuous improvement
• Investment
• Market research
• Flexibility

 

COMPETITION

Business -Under pressure to get customers and can adopt methods such as:

• Lower prices, better quality, advertise and promote, offer extras adding value
• Reduce profit potential
• Make barriers into market

Consumer

• Choice, in absence of competition consumers may be exploited

Risk – action taken by business and outcome unknown Uncertainty – external influences beyond control

Product orientation – focuses on production process, products design, quality and performance

Market orientation – continuously identifies, reviews and analyses consumer needs. More engaged with effective marketing:

• Respond quickly to change
• Confident in product launch
• Anticipate change from research/trends
• Meet and compete with rivals

Influences of market orientation:

• Nature of product
• Policy decisions
• Views of those in control
• Nature and size of market
• Degree of competition

THREE purposes of market research:

• Identify and indicate customer wants and needs
• Quantify likely demand
• Insight into consumer behaviour

 

DATABASE – stores client info, easily searched and found facility

SOCIAL NETWORKING – global reach, cheap and analyses trends

WEBSITE – surveys, cheap and available 24/7

 

QUALITATIVE RESEARCH – attitudes, beliefs and intentions QUANTITATIVE RESEARCH – measured and statistical

Primary research:

• Questionnaires
• Posta surveys
• Focus group
• Test marketing

 

Secondary research:

• Internal data
• External data

 

SEGMENTATION

Geographic

• Different needs depending on where they live and different wants culturally Demographic
• Age, gender, income, social class, ethnicity, religion

Psychographic

• Attitudes, opinions and lifestyle, difficult to collect data type Behavioural
• Loyalty or impulse

 

BENEFITS

• Meet specific needs
• Increase revenue
• Avoid wasting resources
• Gain loyalty

Market positioning – conceptions consumers hold can use, benefits of products, USP, attributes of product, origin or classification

Market map – two dimensional, helpful for individual brands not corporate. Can only compare two feature

Competitive advantage

• Design – differentiation
• Quality – premium price
• Promotion – personalise advertisement
• Customer service – exceed and deliver encouraging sales
• Ethical stance – segment

 

Differentiation; gain competitive edge

• Flexible pricing – create perceived high quality allowing premium pricing
• Recognition – more appealing, higher sales revenue and less advertising
• Product range – each market
• Brand development – use, overcome competitor

Adding value

• Bundling
• Customer service
• Packaging
• Frequent buyer offers
• Customisation