The Role of the Consumer and Market Dynamics

These flashcards cover the fundamental vocabulary and concepts regarding the role of consumers, market types, segmentation, and the impact of competition and trends as discussed in the lecture.

Consumers

People who buy goods or services.

Producers

Businesses that make goods and services.

Marketplace

A place people go to buy and sell, examples include a farmers market or a fast food restaurant.

Market

A venue that exists wherever consumers (buyers) and producers (sellers) come together to do business.

Consumer Market (B2C)

Made up of all individuals or households who want goods and services for personal consumption or use; stands for Business to consumer.

Business-to-Business or Industrial Market (B2B)

Consists of all the individuals and organizations that produce, sell, rent, or supply goods and services to other businesses, such as delivery vans sold to a flower shop.

Geographic Segmentation

The division of a market based on zip code, city, country, population density, climate, time zone, or distance from a specific location.

Demographic Segmentation

The division of a market based on age, gender, income, occupation, family size, race, religion, marital status, education, or ethnicity.

Psychographic Segmentation

The division of a market based on values, goals, needs, pain points, hobbies, personality traits, interests, or political party affiliation.

Behavioral Segmentation

The division of a market based on purchasing habits, brand interactions, spending habits, customer loyalty, or actions taken on a website.

Obsolete Products and Services

Items for which there is no longer a want or need; when consumers stop buying them, producers stop making them.

Wheaties Dunk-A-Balls

A cereal launched by General Mills for kids shaped like basketballs that failed because parents did not like it encouraged playing with food.

Competition

Occurs when $2+$ businesses try to sell the same type of product or service to the same customer, significantly impacting price and demand.

Trends

A general direction or change in society that lasts a long time, typically $3$ years or more.

Fads

Changes that lead to temporary or short-term adjustment, typically lasting $6$ months to a year.

Lifestyle Trends

Long-term societal changes such as moving towards eco-friendly reusable items, eating local/organic products, and using chemical-free (BPA free) products.

Pricing Power

The concept that businesses have power over prices when they control the market, while consumers only have power when there are desirable alternative choices.