Markets

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    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

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