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4.1 THE ROLE OF MARKETING (MARKET CHARACTERISTICS (Competitors and Ease of…
4.1 THE ROLE OF MARKETING
DEFINITION
management task that links the business to the customer by identifying and meeting the needs of customers profitably
Management Functions
market research
product design
pricing
advertising
distribution
customer service
packaging
MARKET CHARACTERISTICS
Market Size
the total level of sales of all producers within a market
significants
Asses whether a market is worth entering or not
to calculate their own market share
growth or decline of the market can be identified
measured by
value
volume
Market Growth
the percentage change in the total size of a market (volume or value) over a period of time
factors
economic growth
consumer incomes
development of new market
consumer tastes
technological change
whether the market is "saturated" or not?
Competitors and Ease of Entry
the lack of barriers for the establishment of new competitors in a market
the greater the number of competitors and the easier for new one to join the markets, the more price competition there will be
Differentiated or homogeneous products
goods that are physically identical or viewed as identical by consumers
Segmentation
dividing a market into distinct groups of consumers who share common tastes and requirements
MARKETING APPROACHES
Market orientation
an outward-looking approach basing product decisions on consumer demand, as established by market research
Product orientation
an-inward looking approach that focuses on making products that can be made or have been made for a long time, and then trying to sell them
Social marketing
commercial marketing
MARKET SHARE & MARKET LEADERSHIP
Market share
the percentage of sales in the total market sold by once business
market share %
=(firm' s sales in time period)/(total market sales in time period) x 100
Market leadership
when a business has the highest market share of all firms that operate in that market
Marketing Objectives
the goals set for the marketing department to help the business achieve its overall objectives
For-profit organisations
INCREASE IN:
Market share
total sales
average number of items purchased per customer visit
frequency that a loyal customer shops
percentage of customers who are returning customers (customer loyalty)
customer satisfaction
customer identity
Non-profit-making organisations
maximize revenue from trading activities
increase recognition of the of the organisation by society
promote the work and aims of the organisation to a wide audience
MARKETING STRATEGIES
innovation
ethical consideration
cultural differences