Basics of Marketing

3. • Traditionally, a “market” was a physical place where
buyers and sellers gathered to buy
• and sell goods. Economists describe a market as a
collection of buyers and sellers who transact over
• a particular product or product class (such as the housing
market or the grain market).

4. • Marketers use the term market to cover various groupings of
customers. They view sellers as constituting the industry and
buyers as constituting the market. They talk about need
markets (the diet-seeking market), product markets (the shoe
market), demographic markets (the youth market), and
geographic markets (the Chinese market); or they extend the
concept to cover voter markets, labor markets, and donor
markets, for instance.

5. Connecting flow of five basic market

6. • Figure shows the relationship between the industry and the
market. Sellers and buyers are connected by four flows. Sellers
send goods and services and communications such as ads and
direct mail to the market; in return they receive money and
information such as customer attitudes and sales data. The
inner loop shows an exchange of money for goods and
services; the outer loop shows an exchange of information.

7. Relationship between market and industry

8. Types of market

9. Consumer Markets
• Each time you buy product and service you are participating in the
consumer market whether you are paying for groceries or you are
picking up for car wash , you are the part of this larger system.
• It is a system that allows us to purchase, products,goods and services.
These item can be used for personal use or share with others
• In a consumer market you make your own decisions about how you will
spend money and use the products you purchase
• The more people who go out and actively purchase products, the more
active is the consumer market.

10. Companies selling mass consumer goods and services such as juices,
cosmetics, athletic shoes, and air travel spend a great deal of time
establishing a strong brand image by developing a superior product
and packaging, ensuring its availability, and backing it with engaging
communications and reliable service.

11. • Companies selling business goods and services often face well-
informed professional buyers skilled at evaluating competitive
offerings. Business buyers buy goods to make or resell a product to
others at a profit. Business marketers must demonstrate how their
products will help achieve higher revenue or lower costs.
Advertising can play a role, but the sales force, the price, and the
company’s reputation may play a greater one.

12. Business Markets
A business market is made up of groups of people who buy goods and services to use in producing other
products, to resell, or for their own use in their day-to-day operations. The four different types
of business markets are:
• Producer markets: Producers buy goods and services and transform them into a sellable product,
which they sell to their customers for the purpose of making a profit. Examples of producers are
farmers, manufacturers and construction companies.
• Reseller markets: Resellers buy finished products and resell them to their customers for the purpose
of making a profit. Resellers do not modify the products they buy. Resellers can be wholesalers who
sell their products to other resellers or retailers who sell their products to end users.
• Government markets: Governments buy goods and services to support their internal operations; they
do not transform the goods and services or resell them to make a profit. Government markets
usually buy their goods through a bidding process and include federal, state, county, and local
governments.
• Institutional markets: Institutions are non-government organizations that buy goods and services to
support their internal operations. The function of institutions is to better their communities, not to
make a profit. Examples of institutional markets are churches, hospitals, and colleges.

13. Global market
• A global market is not limited to specific geographic locations but rather involves
the exchange of good, services, and labor anywhere in the world. For example, a
business may be located in the United States. It may purchase components for
one of its products from Japan, South Korea, Germany, and Mexico. The
components may be shipped by a shipping company from Greece to an
outsourcing firm in China for assembly, where it is then transported across
Chinese and Russian railroads for distribution in European retail stores. The
business' stock may be traded on the New York Stock Exchange, Japanese
Nikkei Exchange, and the London Stock exchange.

14. • Companies in the global marketplace must decide which countries to enter;
• how to enter each (as an exporter, licenser, joint venture partner, contract
manufacturer, or solo
• manufacturer); how to adapt product and service features to each country;
how to price products
• in different countries; and how to design communications for different
cultures. They face different
• requirements for buying and disposing of property; cultural, language, legal
and political
• differences; and currency fluctuations. Yet, the payoff can be huge

15. Nonprofit and Governmental Markets
• Companies selling to nonprofit organizations with
• limited purchasing power such as churches, universities,
charitable organizations, and government
• agencies need to price carefully. Lower selling prices affect the
features and quality the seller can
• build into the offering. Much government purchasing calls for
bids, and buyers often focus on
• practical solutions and favor the lowest bid in the absence of
extenuating factors.15