The Role of Marketing The Market Market: A place or process whereby customers and suppliers trade. ● Exists where there is a demand for a particular product (e.g. textbooks, flowers) and where there is a willingness from businesses to supply these products ● Customers – Can be private individuals or the government ● Process of researching into identifying consumer needs and employing appropriate price,product, place and promotion strategies in order to satisfy these needs profitably Main Objective: Ensure customers needs and wants are satisfied through the product provided A Customer Focused Organisation: ● Is founded on the belief that profit can best be achieved by identifying, anticipating, and satisfying customer wants and needs ○ Market research ● A company which adopted this concept and philosophy places customer at center of all business decisions ● Customers need to permeate all levels and functions in the organisation ● Passive/Active advertising e.g. tasters, competitions ● Co-ordinate and integrate all marketing activities that might affect the customer Key Elements of Marketing: ● Customers are of vital importance ● Marketing is a process – Does not have a start or end, ongoing all the time ● Involves building relationships with customers ● Is a business philosophy – Way of thinking about to how satisfy customer needs ● Affects all aspects of business ● Not just about selling ● Marketing and advertising are not the same ● Must satisfy consumer wants profitably Consumer Markets: Markets that cater to private individuals e.g. general public Industrial/Commercial Markets: Markets that cater to organisations e.g. businesses and the government Three elements of the market: Market size can be measured in a number of ways: Method How?
Customer Base ● Measures the total potential number of customers ● Multinationals have expanded to China and India ● Internet has broadened customer base ● Can be measured in terms of value, not just volume of what customers purchase Barriers to entry ● Determine number of suppliers in the marketand be a measure of market size ● Markets e.g. oil/aircraft manufacturing, entry barriers are extremely high; ● Huge start set up costs/existing firms will dominate with market power & large economies of scale ● Other markets with low barriers to entry, more firms that operate on a smaller scale Location ● Some markets e.g. Adidas focus on particular country/region ● Adidas is market leader in supply of equipment for Taekwando – Korea has 4/5 of world’s black belt holders ● International trade and globalization have meant that the size of a market is not confined to the domestic market