2. Market is an actual or nominal place where forces
of demand and supply operate, and where buyers and
sellers interact (directly or through intermediaries) to
trade goods, services, or contracts or instruments, for
money or barter.
3. Competitive Market
A competitive market is one in which a large
numbers of producers compete with each other to satisfy
the wants and needs of a large number of consumers. In a
competitive market no single producer, or group of
producers, and no single consumer, or group of consumers,
can dictate how the market operates. Nor can they
individually determine the price of goods and services, and
how much will be exchanged.
4. Market Structure
There are 4 basic market models: pure
competition, monopolistic competition, oligopoly, and
pure monopoly. Because the competition among the
last 3 categories is limited, these market models are
often referred to as imperfect competition.
6. Perfect or Pure Competition
Large number of firms
Homogenous product
Easy entry/exit
No market power (price
taker)
Perfect information
Examples (Agriculture-
wheat, corn)
7. Monopolistic competition
A large number of firms
Similar but differentiated
products
Low barriers to entry
Market power (limited)
Examples (restaurants,
hotels)
8. Oligopoly
A few large firms
Standardized or
differentiated products
Significant barriers to entry
Market power
(interdependent)
Examples (Steel, oil,
automobiles)
9. Pure monopoly
One firm
Unique product
Blocked entry
Market power (price maker)
Examples (local utilities)
10. Pricing
Pricing is one of the most important elements of the
marketing mix, as it is the only mix, which generates a
turnover for the organization. The remaining 3p’s are the
variable cost for the organization. It costs to produce and
design a product, it costs to distribute a product and costs
to promote it. Price must support these elements of the
mix. Pricing is difficult and must reflect supply and
demand relationship.
11. Pricing factors
Fixed and variable costs.
Competition
Company objectives
Proposed positioning
strategies.
Target group and willingness
to pay