The Market & Marketing

Chapter 16

  • A market is where buyers and sellers come together to exchange products for money; this will not usually be a single location
  • Marketing is the management process which identifies customer wants, anticipates their future wants and then goes about satisfying them profitably
  • A product oriented business is one which focuses mainly on the product itself. These usually produce basic necessities such as fresh foods. The manufacturer and retailer are mainly concerned with the price and quality.
  • A market oriented business is one which carries out market research to find out what a consumer wants before a product is developed and produced. They are better able to survive and be successful because they are usually more prepared for changes in customer taste.
  • Reasons why the importance of market orientation is growing:
    Greater competition
    Shorter life-cycles
    Consumers are more demanding
    Markets are more fragmented
    Competitors have a clearer idea of customer needs
    Customers are more informed
    Markets are more open
  • A marketing budget is a financial plan for the marketing of a product or product range for a specific period of time so that the marketing department knows how much they are allowed to spend.

Marketing Department

SalesInternational and national sale of the product
Research and DevelopmentMarket research and testing
PromotionAdvertising within the marketing budget

Objectives of Marketing

  • Increase sales revenue and profitability
  • Increase or maintain market share
  • Maintain or improve image
  • Target new market or market segment- may be in a new country
  • Develop new products or improve existing ones
  • Differentiation/ Diversification of product/business
  • Constant improvement to extend lifeline of product
  • Beat competition

SWOT Analysis

  • Technique used to help the marketing department to assess a product through its strengths, weaknesses, opportunities and threats

Low Price

Good Image


Good Quality


High Cost

Bad reputation

Low quality


New features


Market research

New market segment


Lack of supply

No e-commerce



Market Segmentation

  • When a market is broken down into sub-groups which share similar characteristics
  • This helps them identify their customer and satisfy their needs and wants better
  • A segment whose needs are not being met is known as a gap in the market
  • Market size is the value of sales in the market measured by number of units sold or value of sales
  • Market share is a firm’s percentage of sales in the market
  • Mass market is the market for goods that are produced in large quantities
  • Niche market is a specialized, small segment of a much larger market
  • Dangers of a niche market:
    Firm may be too reliant on one product
    No economies of scale
    Large producers may enter the market
  • Ways of segmenting a product:
    Income group
    Use of product
    Family size
    Usage rates

Marketing Mix

  • Describes all the activities which go into marketing a product
PriceComparison is to be made with the prices of competitor’s products.

Price should, in the long run, cover costs.

ProductDesign and quality

Compare to competitor’s products

PromotionAdvertisement and promotion methods

Discounts and sales promotions

PlaceChannels of distribution

Methods of distribution

  • Some classify packaging as being the fifth “P” but it can be included as part of product and promotion both
  • These four Ps create the brand image

Boston Box (Boston Consulting Group’s matrix)

  • It divides the products into four categories according to their market share and nature of market
Cash Cowsprofitable, popular, well promoted
Starsvery popular but still require investment to reach the top since they are not profitable
Problem Childrenproblem in terms of what to do with them
Dogsdead products, or near dead


ProfitableCash CowsProblem Children

Investment, promotion strategies and advertisements can help them all become cash cows

2 thoughts on “The Market & Marketing

  1. AustinNovember 7, 2019 / 4:41 pm

    May Expand For Me The Point Shoter Life-cycles As Advantage Of Markert Orianted Business


    • emDecember 7, 2019 / 8:18 pm

      Items have shorter life cycles, they are quick to be desired, and quick to be out of demand. For example, if fidget spinners are in demand in November 2018, by February 2018, no one wants them. Compare this to other products which are in demand all the time e.g. milk, or shampoo.


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