Marketing – Part 1

IT’S GOOD to be with you all again. This lesson begins a new section of the syllabus: Marketing. We will cover Objectives 1 and 3 and touch on Objective 2, which will also be discussed in future lessons. The lesson will conclude with more detail on market research.

WHAT IS A MARKET?

A market exists under any conditions where buyers and sellers are in contact directly or indirectly for the purpose of exchanging goods and services. The four elements of the market are: buyers, sellers, goods and services, and price. If any of the elements is removed, then the market will not exist.

There are different types of markets: Product markets - the market for goods and services; the financial markets - the markets for shares, stocks and bonds.

The term ‘market’ is also used to describe the extent of the demand for a commodity. Hence, a large market means that there is a large demand for the good or service.

WHAT IS MARKETING?

Marketing refers to the human activities and efforts which are interrelated and focused on bringing the goods and services to the consumer. It has to do with getting the right goods to the right people, at the right price, and at the right time, in the most profitable and efficient manner.

MARKETING ACTIVITIES

These include: Market research, which includes consumer taste research, research on competitors and on consumer behaviour, pricing, packaging, branding, sales promotion, advertising and distribution.

THE MARKETING MIX

This refers to everything a firm can do to influence the demand for the product. It is a collective term that is used to refer to the whole range of marketing activities, techniques and strategies that a firm uses to reach its target market.

The variables of the marketing mix can easily be remembered by referring to the 4 Ps: Product, Price, Place and Promotion.

PRODUCT

The good or service that the consumer wants.

PRICE

Profit is usually incorporated in the price.

PLACE

Product must reach the place where the good or service is required – distribution.

PROMOTION

This refers to the ways in which consumers are made aware of the availability of the product or service and the qualities it has. Advertising is the most important aspect of product promotion.

MARKET RESEARCH

Market research refers to a systematic approach to collecting information, recording and analysing the information collected, and adopting the information to the marketing plan of the business.

CONCEPT

The marketing concept requires that a firm be aware of customers’ needs to try to meet those needs, and to attempt to make a profit in the process.

Market research assists the firm to meet the goal of the marketing concept by helping the process of finding out what the consumer wants.

Market research investigates what consumers are buying or are likely to buy in the future. It is normally done before the advertising campaign. Sometimes it is carried out after the product is well established in order to assess and improve advertising and evaluate product performance.

REASONS FOR CONDUCTING MARKET RESEARCH

Market research will help in making decisions about:

■ Where to sell a good or service.

■ How to sell it.

■ Consumer tastes – that is, which customers need the product, and exactly what they want and what they dislike.

■ How to price the product.

■ How to promote the product.

■ Competition – who are the competitors in the marketplace and what they are doing.

■ What the size of the market is?

■ Consumer behaviour – how consumers will react to certain conditions or when faced with certain factors. In other words, market research helps us to see what influences the consumer

ACTIVITY

Create a marketing mix for a new or existing product. This means that you will outline the product under the headings of the 4 Ps.

Next week’s lesson will continue market research by outlining the types of market research.