Difference between Market and Marketing
A market is any space within which trade takes place between buyers and sellers for a well-defined product. Marketing is all those activities that facilitate trade. These include activities that identify consumers’ needs such as market research and those activities that make the product appealing to consumers such as packaging and distribution.
The following are marketing activities:
- Market research – this is the process of gathering information about potential product and customers.
- Packaging – creating an attractive package for product usage and for advertising
- Branding - differentiating the product of a company from other brands and establishing loyal customers.
- Pricing - identifying the right price that will encourage sales
- Advertising – methods used such as the best and most appropriate media to inform and encourage the purchase of goods and services
- Distribution - methods used to make the product available to consumers such as wholesale, retail or internet.
The Marketing Mix
The 4Ps of marketing is a model for enhancing the marketing strategy of the business or marketing mix which is the way in which the business takes a new product or service to market. t helps the business define its marketing options in terms of price, product, promotion, and place so that the business offering meets a specific customer need or demand.
Marketing mix is a general phrase used to describe the different kinds of choices available to organizations in the entire process of positioning a product or service in the market. The 4Ps is one way of defining the marketing mix. The 4Ps are: product or service, place, price and promotion.
- What does the customer want from the product or what needs does it satisfy?
- How is the product branded?
- How is the product differentiated from its competitors?
- Where do buyers look for your product or service?
- How can you access the right distribution channels?
- What is the value of the product or service to the buyer?
- How will your price compare with your competitors?
- Where and when can you get your marketing messages across to your target market?
- Will you reach your audience by advertising online, in the press, on TV, on radio, or on billboards? On the Internet?
Who will be your customers?
The Concept of Market Research
Market research is the gathering, recording and analysing of data to address the marketing issues of a business. Market research must be specific to the problem of a business. The marketing research process consists of five steps:
- Identifying or defining the problem.
- Developing information sources.
- Collecting the information.
- Analysing the data.
- Presenting the findings.
Market research involves two types of data:
Primary information using primary research – is defined as factual, firsthand accounts of the study written by a person who was part of the study. Primary information comes straight from the original source, in other words it is made up of original documents and raw data. In primary research, surveys are usually conducted using sampling.
Secondary information using secondary research - this type of research is already compiled and organized for the business. Some examples of secondary information include reports and studies by government agencies, trade associations or other businesses within your industry.
Factors Affecting Consumer Behaviour
Consumer behaviour is the study of how individual customers, groups or organizations select, buy and use goods and services to satisfy their needs and wants. It refers to the actions of the consumers in the marketplace and the underlying motives for those actions. The following factors will cause consumers to either increase or decrease their demand for a product.
- The price of a commodity - consumers can afford to buy more of a good when its price falls and less when its price rises.
- The prices of other goods and services (substitutes and complements) - substitute products are those that can be used alternatively as they satisfy the same need for a consumer. complements are goods that are used together such as bread and butter. If the price of butter rises then its demand will fall and so will the demand for bread.
- Income of consumers - as income level rises consumers will demand more goods and services
- Taste and Preferences – a change in consumers taste for goods and services will impact on their demand.. For example, changes in fashion will result in a drastic decline in demand for an outgoing fashion and a rise in demand for what is trendy.
- Expectations of a future Rise in Price - if consumers expect the price of a commodity to rise in the near future, they will try to purchase more now before the price increases.
Packaging and Presentation of Goods
Packaging refers to designing and producing the container, box or package that holds the product. A good package must identify, protect and advertise the product. It must also make the product convenient to use. A package must also sell the product. It must first attract customers to it to buy. Branding is any identifiable feature of a product which makes it different from the products of competitors. A brand may be a name, term, symbol or a design.
Promotion includes all forms of advertising, public relations and sales promotion. Advertising is the paid presentation of goods or services through the media for the purpose of encouraging consumer support. The media refers to television, radio, magazines, newspapers, billboards and websites.
Sales promotion is a marketing strategy that is used to induce customers to buy immediately. Examples of sales promotion methods are:
- A sale on items.
- Bargain packs such as ‘two for price of one’.
- Coupons – the holders of coupons are allowed a discount on the items bought.
- Contest - purchasers may receive a prize if they are the winners of a contest.
Media of Advertising
Advertising is a means of communication with the users of a product or service. Advertisements are messages paid for by those who send them and are intended to inform or influence people who receive them. Today's advertisers have many choices at their disposal. The following are the options of advertising media:
Digital Online Advertising - Advertisement via the Internet is online advertising. There are ads on just about every web page. Current trends in mobile advertising involve major use of social media such as Twitter, Instagram, Snapchat, and Facebook.
Print Advertising - Once a huge driver of sales, print is taking a back seat to the many digital forms of advertising now available to marketers. Typically, print can be split into three sub-categories: brochures, flyers and point of sale advertising.
Techniques of Selling
Selling techniques include:
- Personal Selling – This is the use of sales persons to present and sell goods and services of a firm.
- After-sale services - such as warranty and installation
- Merchandising - refers to self-service methods of sale. This is used in supermarkets and department stores. It allows for a better display of goods and creates a more comfortable shopping environment.
Terms of Sale
A business establishment may offer its customers various terms to settle accounts such as follows:
Cash - This is preferable by most businesses and therefore customers are encouraged to make cash payments. They are usually offered a lower payment amount for goods bought for cash.
Credit - Customers are allowed to pay at intervals over a short- term.
Hire Purchase - is a long term payment plan 24 – 36 months that are given to customers based on their ability to repayment.
Cash Discount - A cash discount is a reduction in the price of a good that is paid for immediately or over a short period of time by a customer.
Functions of Consumer Organizations
Consumerism is defined as the education and the protection of consumers to prevent their exploitation. Consumer organization are organizations that are established to protect customers and it usually takes the form of an Ombudsman which exists to entertain complaints from customers regarding treatment of businesses that are offering products and services to the public. These customer organizations therefore prevent customer exploitation which includes:
- offering poor quality goods and services
- short measurements and weights
Forms of Customer Service
Warranty - a written guarantee, issued to the purchaser of an article by its manufacturer, promising to repair or replace it at no extra cost if necessary within a specified period of time.
After sales service – After sales service is a service offered to repair items in the event that they need repairs.
Feedback - feedback is very important to businesses in that it results in very important information be submitted to businesses where they can make adjustments and improvements to the products.
Toll free numbers/call centres - being allowed to call in toll free is a very convenient way to communicate with the business in which products are purchase.
Methods of Retailing
Retailing is the selling of products and certain services to consumers. It ordinarily involves the selling of individual units or small lots to large numbers of customers by a business set up for that specific purpose. There are several methods by which retailers can offer items for sale which are as follows:
Community Shops and Convenient Stores - these tend to serve a particular community. Opening hours include all weekend days, holidays and very late in the evenings.
Department Stores – these stores carry a several lines of goods under one roof.
Mail Order - Orders are made from catalogues and goods are delivered by courier or mailed to customers.
Vending Machines - these self-service machines are placed at various locations by their owners.
Concept of Intellectual Property Rights
Copyright is a form of intellectual property right that legally protects the innovators of original works. Copyright protects creators’ expressions such as music, painting, movie, photograph and writings. Individuals who wish to use works that are copyrighted must request permission from its creator. Copyright law allows innovators of original work to be paid for them. Other forms of intellectual property rights are patents and trademark. Patent protects innovation. It excludes others from making and selling that invention for a number of years. Trademark legally protects brand names. It gives the seller exclusive rights to use a particular brand name.