Section 3 : Marketing

What is marketing?

What is marketing?

Identifying customer wants and satisfying them profitably.

The role of marketing in a business

• Identifying customer needs

• Satisfying customer needs:

• Maintaining customer loyalty

• Build customer relationships to gain information about customers

• Anticipate changes in customer needs
  

Some objectives the marketing department in a firm may have

• Raise awareness of their product(s)

• Increase sales revenue and profits

• Increase or maintain market share

• Enter new markets at home or abroad

• Develop new products or improve existing products.

Why customer spending patterns may change:

• change in their tastes and preferences

• change in technology : as new technology becomes available, the old versions of products become outdated and people want more sophisticated features on products

• change in income: the higher the income, the more expensive goods consumers will buy and vice versa

• ageing population: in many countries, the proportion of older people is increasing and so demand for products for seniors are increasing (such as anti-ageing creams, medical assistance etc.)
  

Why some markets have become more competitive

• Globalization: products are being sold in markets all over the world, so there are more competitors in the market

• Improvement in transportation infrastructures: better transport systems means that it is easier and cheaper to distribute and sell products everywhere

• Internet/E-Commerce: customers can now buy products over the internet form anywhere in the world, making the market more competitive
  

How can a business ensure that it maintains its market share and remains competitive in the market?

• maintaining good customer relationships:

• keep improving its existing products, so that sales is maintained.

• introduce new products to keep customers coming back, and drive them away from competitors’ products

• keep costs low to maintain profitability

Define ‘niche market’

Define ‘mass market’

Selling the same product to the whole market with no attempt to target groups within it. 

Advantages of Niche Market

• Small firms can thrive in niche markets where large forms have not yet been established

• If there are no or very few competitors, firms can sell products at a high price and gain high profit margins because customers will be willing be willing to pay more for exclusive products

• Firms can focus on the needs of just one customer group, thereby giving them an advantage over large firms who only sell to the mass market