Chapter 17: Nature of marketing
Cards (31)
- MarketPlace where buyers and sellers meet to engage in exchange
- Consumer marketsMarkets for goods and services bought by the final user of them (B2C)
- Industrial marketsMarkets for goods and services bought by businesses to be used in the production process of other products (B2B)
- Marketingthe process of researching into and identifying consumer needs and employing appropriate price, product, place and promotion strategies to satisfy these needs profitably.
- marketing objectivesthe goals set for the marketing department to help the business achieve overall objectives
- equilibrium pricethe price level at which demand is equal to supply
- corporate objectiveswell defined and realistic goals set for the whole company
- DemandThe quantity of a product that consumers are willing and able to buy at a given price during a time periodPrice decreases -> demand increases
- SupplyThe quantity of a product that firms are prepared to supply at a given price in a time periodprice increases -> supply increases
- •Demand and price have an inverse relationship•Supply and price have a direct relationship
- Factors that affect demandChanges in consumers’ incomeChanges in consumer tasteChange in seasonIncome tax
- Factors that affect supplycosts of productionweathertechnologyproductivitynum of producers
- market segmenta subgroup of a whole market in which consumers have similar characteristics
- consumer (market) orientationAn outwork looking approach when a businesses focuses on consumers and makes the product based on their needs by conducting market research
- market shareThe percentage of sales in the total market sold by one business
- product orientationAn inward looking approach when a business focuses on their product and try to sell them
- market sizeTotal level of sales of all producers within a market
- market growthPercentage change in the total size of a market (volume or value) over a period of time
- What are the factors that affect the market growth?Economic growthChanges in consumer incomesChange in consumer tastesSaturation levels of that market
- How do business respond to market changesMaintain good relationship with customersKeep costs lowBring out new productsImprove existing product
- brand leaderthe brand with the highest share of the market
- Mass marketingselling standardised products the same way to the whole marketadvantages: more consumers, less costly, can benefit from economies of scaledisadvantages: more competition, lower prices
- Niche marketingselling differentiated products to suit a segment of a marketadvantages: less competition, higher price, golden statusdisadvantages: costly, no economies of scale, less consumers
- Differences betwen niche and mass marketingmass targets a broad audience while niche targets a specific audience. Mass is more cost efficient and more competition, while niche is more expensive and less competition
- 3 ways of segmentation
- CRMThe strategies and technologies that companies use to manage and analyse customer interactions and data throughout the customer lifecycle to improve customer relationships and drive sales
- CRM aims•Improved Customer Satisfaction•Improve The Efficiency•Expand Customer Base•Enhance Sales
- Methods of CRMcommunicate regularlysocial mediatarget marketingcustomer service
- Benfits of CRM
- cost-effective.
- customer loyalty
- brand image
- market segmentation
- advantages:
can define target marketprice discriminationdifferentiate marketing strategiessmall firms can only compete in one or two segments- disadvantages
costs of researchtime consumingpromotional costs may be high - costs of CRM:
-it systems and software are needed as well as training-effective CRM campains may require the use of external marketing consultant, which is costly-requires an existing customer base-costly to repond to feedback- benefits:
-for businesses with an existing customer base, CRM is cost effective-sustainable strategy that crates long term customers-loyal customers recommend to others