Understanding a marketplace and consumer needs
|✅ Paper Type: Free Essay||✅ Subject: Marketing|
|✅ Wordcount: 5231 words||✅ Published: 10th May 2017|
To understand a marketplace and consumer needs, there are five core concept where one of it is needs, wants, and demands. Needs is a state of felt deprivation such as basic physical needs. Wants is the needs where are form by culture or individuals. Demands are wants that are affected by the buying power. This concept identifies the customer value and satisfaction where customer value can be define as the difference between the values the customers gains from owning and using a product and the cost of obtaining the product while customer satisfaction are product’s perceived performance matches the buyer’s expectations. For example, the needs are food, shelter, clothes, and other basic requirements to live while wants are Big Mac, and also demands are mobile phones.
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The second concept is marketing offers where is a combination of products, services, information that satisfy someone’s need or want. For example, IKEA they provide products such as furniture while they also provide services such as interior designing for the home and also they provide information to their customers and also the experience of some customers uses IKEA furniture will satisfy for their marketing offer. Third is the value and satisfaction. Marketers should deliver high value to consumers because they have expectations regarding the value. While satisfaction is where a customer of a product or services will buy or use again the product and services and also tell others about their experiences using the product or services. For example, I used Sunsilk for my shampoo and because of the satisfaction of using it I recommended to my colleagues. Then is the exchange, transactions and relationships concept where it is an act of obtaining desired thing from someone by offering something in return. In an exchange process there are relationship built through delivering value and satisfaction. For example, John is a stamp collector and he found Jane with a stamp he is searching for a long time. To get the stamp he decided to change one of his stamps with Jane to get that stamp and while the transaction process they have built a relationship between them where the value and satisfaction of getting the stamp they wanted. Then the last is the markets where the markets are a set of actual buyers where they really consume the product. And from there the marketers seek for profitable buyers. For example in the fasting month, the potential markets for Ramadhan market are the Muslim community where they buy food for breaking fast.
From the five cores I explain, there are none of them being more important than any of the others because all of them are related. In a marketplace, a marketers needs to know what the people or consumers needs, wants, and demands so that the marketers may give them marketing offers because the product are produced based on what the consumers requires. Because of that the consumers will experience the value of the product and get the satisfaction from what the marketers provided. After the consumers are satisfied with the product or services, they will exchange feedbacks to the marketers where it is very important to an organization. The relationship between the organization and consumers are also built because of the product and the feedback from the satisfaction of the consumers using the product or services. Then from all the above the marketers will know who are the potential buyers of their product either they are just a normal customers or consumers where will give the organization profit.
I agree because marketers today they do not want to waste money. The more customers they target on the more money they spend to do research and also some of the customers do not use or buy the product or services they provided where they will not get the expected profit. Other than that, it is also a waste of time. Time consuming is very precious for marketers because they need to do their market research in a short period of time to cut down the cost and start producing. When the marketers target on just any of the customers they will need more time to obtain the result of the research. On the other hand, target your customers are important because the marketers can indentifies the people who really consume the product or services they provide where bring them profit for a long period. Based on what I have agreed, Porsche are more likely to follow this creed because the product they are selling which are the cars are more to middle to higher income people because is an executive car. For example, the cheapest car is the Cayenne which cost $46700. The Porsche’s marketers will not waste their time to go through research for low income customers because a waste of time will also affect the waste of money. This is because they need to target the people who really will buy their cars where will give them profit while the lower income are just interest group where they do no influence and are not important to the company. While for Wal-Mart they targeted all of the people in United States because the things that they sell and the services they provide are affordable to everyone in the States.
Yes it does make sense because in an organization each department are collaborating so that they can get less expense with higher profit. It does give a greater value to the customers because when the customers are happy with the product they are using they will invest more to obtain the product for a long period. For example, I started using Sunsilk shampoo when I was 14 years old and I was happy with the product and start to obtain the product until now for almost 7 years. These are the value of the customers get from the company the trust of the customers.
Marketing department and the human resource department (HRM) could generate increased customer value when the HRM can give training to the marketing people how to communicate with their customers to get more feedback of their product. Marketing department they need interpersonal communication skills so that the customers will understand what are they selling. HRM will also motivate the marketing people to be more patients with customers because customers always come first where they are the one who are buying the product. By collaborating with HRM the marketing team can improve their own interpersonal skills and also increase the customer’s value and also increase the company’s profit.
Boston Consulting Group has developed BCG growth-share matrix where they identifies four classifications of strategic business units (SBU). First are the Stars where the business has higher market share compared to the competitors and is in a high-growth market. A stars product is a lead product or business of the business where it generates high cash flow and requires high cash input. Second are the Cash Cows where they are in high market share but have low growth rate on their product or business. This business generates high profit because the investment to the business must be low because of the low growth. These products or business are usually the foundation of the business which may be the past Stars. Third are the Dogs where the business has low growth rate and also low market share compared to their competitors. Mostly the company will try to minimize the Dogs business because they will not gain profit using these businesses and they need to consider new strategy to up go the competitors. Fourth are the Question Marks where they have high growth rate but low market share which means they have high demands but low returns. Usually the business or products in this category are the new comers. Where anything can happens to the business or products. To improve their business in this stage they need to invest more.
Management may find difficult to dispose of a Question Mark because in this category not really a business or product cannot survive but they just need more investment and improvement to bring their business to the Star category. While in Stars category they need to be maintained or they will fall to Cash Cow. This market is also growing and there are opportunities for new businesses or products. This makes the management very hard to make decisions because if they keep it they either might encounter loss or getting more profit because of the renew version of the business or product. On the other hand, some people will make investment to it and the business will be continuous running.
Yes because in preparing managing marketing program the marketers need to find out the niche market where the four P’s are used. To find a niche market they need to narrow their research to Product, what are they selling, Price, how much is the product and who should they target either low, middle or higher income people, Place, where should they target their market, and also Promotion, how they will be advertising and to whom. All this may help the marketers able to sell their product and gain profit. There are no issues with this framework in relation to service products because most of the services are affordable by all the people. For example, in bas services they do not use the framework because all places need to have public transport. In some cases there are some services products still need to use this framework such as some higher class saloon, A Cut Above. Their target market are for the middle to higher income people because their hair cut services price are based on how long the hair are and the minimum price is RM 80 for a short hair cut.
The other name of Product/market Expansion Grid is the Ansoff Matrix. There are four options that comprise this grid. The first is market penetration where the company will offer the existing products or services in the current market to increase their profit. The company will try to get the interested group to buy their product or services and change them into consumer. For example, selling a computer with augmented product such as warranty will make the customers interested. Second is the market development where the company develop a new market for their existing product to increase their sales and profits. The strategy is by using geographical or demographical changes. For example, Tesco hypermarket expended their market to Malaysia and they did slightly changes to suite with local market. Third is the product development where the company sells new product or services in current market. The strategy of the company is trying to introduce new product to the existing consumers. For example, McDonalds develop a new product line which is the GCB burger and recommended to all their customers. Forth is the diversification where the company sell new products or services in a new market. For example, Walt Disney moved from producing animated movies to theme parks and vacation properties. If a smaller company want to pursue in an existing market they need to choose market development because they already have a new range of similar product but with more unique features on it. Using this strategy the company may lure away the consumers from the competitors to try the new product. Other than that, the company may also search for a new market using geographical options. They can sell their new range of product to more places rather than just one small place. They can also define their target market through the demographical options where it is based on what product are they selling for increase profit and sales.
Company’s microenvironment are the combination of six forces which are the company itself, suppliers, marketing channel firms, customer markets, competitors, and also publics. Based on the 2009 Annual Report of Wal-Mart there are all the six forces are related to the company. First is the company where there are the founder, board of directors, and also all the departments in Wal-Mart. The top management are responsible for setting the company’s mission, objectives, and also the policies. The managers must make the right decisions within the parameter while the other departments must think as consumer because they will implement the decisions to achieve customer value and satisfaction. Second is the marketing intermediaries which are the associates or the firms who help the company to promote, sell, and distribute its good to the consumers. This intermediaries also provides job opportunities for the citizens. For example logistic firm, where they delivers the product to the consumers. Other than that, there are also financial intermediaries where they help the company’s finance transactions. For example the bank who borrows money and also the accounting firms who audited their financial reports which is the Public Company Accounting Oversight Board (United States). Third is the supplier where they provide resources to the company and also its competitors to sell it again where it uses business-to-business option. For example, Wal-Mart is selling Dell, Sony, etc. Fourth is the customers where to company must study about the customers market, business markets, reseller markets, government markets, and also international markets. For Wal-Mart they did not do target market for customers because they targeted all the people will buy in their warehouse because is convenient. While other markets they need to do a special research for it because they are expending the market globally and they need to adapt and learn the culture in every country. For example, the market of Japanese buyers. Fifth are the competitors where Wal-Mart also have competitors because most of the product and services they sell are also provided in other stores. But based on their company policies, they provide faster delivery service is their advantages of being one of the most popular stores in United States. Sixth is the public where they have potential interest on the company such as the local, internal, media, government, and also citizen.
According to Kotler there are seven types of publics from the company’s microenvironment will impact a company’s ability to achieve objectives such as financial publics, media publics, government publics, citizen-action publics, local publics, general public, and internal publics. The new positioning of “fuel efficient” will give the greatest impact to the general public. Where the customers will look upon the specifications of the SUV and also the services that our company provided and these will affect the customers buying behaviour. They will learn about the whole specifications of the SUV to make decision weather is affordable with the cost. Other than that, the company image is also important because it will represent the quality of the SUV. For example the new fuel efficient SUV are using non-polluting hybrid engine where the gas do not makes air polluted and the company must also need to take conscious about the environment like not dumping chemical waste in the river. All this will affect the company’s image and also the customer’s attitude in buying. Also, if the repositioning in media such as advertising does not make the public to understand what we are selling they will not buy the SUV because of bad communications. This will affect the buyers to not buy our SUV because of the miscommunications.
Yes because either the company want to merge with other companies or want to introduce themselves in a market they need to keep-up with technology to compute with their competitors to get the project. Most of the company will choose the company with new technology which will give more security motivated for the other company to work with them. Other than that, with new technology the company may produce new product or improve their product or services. If a company do not keep-up with technology they will produce less output and will get less profit. But in the same time there are industries that the technology does not play an important role for them. For example the food industry such as catering and restaurant they do not need to have new technology to run their businesses. The things that are important to them are just raw materials, chef, customers, and the cooking set. They will not lose the customers or the shareholders if they do not have the current computer software such as Windows 7.
The potential sources of internal data to help create cellular services that provide greater customer value and satisfaction are sales report, the client list, a Web site report, company staff, and previous studies. By using the sales report I can view the sales pattern by region, so I can provide promotions for that particular region or all of it to increase the sales value while in the same time increase the customer value and satisfaction. Then I need the client list so I will know who is subscribing or using our services and also their basic information such as the birth date so I can give appreciation to them for example, Maxis customers will get 24hour free call from Maxis to Maxis at their birthday. Then is the web site report where I can do a report based on our website which is the customer feedback and also do research about the current trend of services online and I can do an improvement on our services for consumer satisfaction. Other than that, I need to know my staff because they will be closed to the customers such as the telephone operators for our services where all the reports will be taken by them and the report are use to make new decisions for the company. the last but not least is the previous studies which is the secondary data from past years such as surveys, studies, and reports will be use to analyze the current situation where it will help to make decisions in improving the services our company provided.
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Secondary data is the data who are kept from the previous years or is been done by other people such as reports, financial statement, and research. Primary data is the data where we gathered by doing our own surveys, observations, and experiment. Once secondary data are gathered and analyzed it is still called secondary data because we only gathered the previous researches and surveys for analysing where we do not include the on hand data such as surveys and researches we do. For example, the financial statement and annual report are used to analyze the customer usage of a product for making a pricing decision currently either increase, decrease, or stay at the same price.
The strength of conducting a market research online is fast and convenient. The marketers do not need to do surveys outside the company where it will take more time to conduct a survey than doing it online. They may just send the survey questions through the email or advertisement board. For example Yahoo Mail will conduct their survey when the users go online and it will pop up before we start using it. Other than that, market research online is also cheap or totally no cost. This will save a lot of money from doing surveys which will cost a lot and will cut the revenue of the company while sending surveys through emails are cost free. For example Yahoo did their survey on their own website so it does not need cost. Also, it gets better feedback because internet users will do the surveys when they were browsing and it will not waste much time to the users and also it is easier. For example Yahoo did the survey on Yahoo Mail where the users of Yahoo Mail will basically answer the questions and continue with their surfing. This will get more feedbacks from the users.
Other than strength of market research online they also have their weaknesses. One of the weaknesses is bad communication skill where the marketers do not know who the customers are and the customers also do not know who the marketers are and they also do not communicate face to face where the marketer never gets to observe their customers for additional research. For example Yahoo will not know the real feelings of their users because they do not observe their expression when answering the questions. Then, the marketers may not get the feedback because some of the internet users will not take the surveys from emails or advertisement. For example when Yahoo conducted the survey, users may still close the survey pop up for not answering the questions. Market research online is also weak in getting everyone doing the survey because when conducting the research online they can only send email to the ones they know which are the consumers but other than that group are not included and this may get lesser feedbacks. For example users of Google Mail will not be doing the survey questions in Yahoo Mail.
In all businesses need to do their market research but for a non profit organizations they may not have the cost to conduct an extensive market research. By using limited resources I can gather information about my primary donors is by email. I can send the form through email to all the donors to gather further information about them since the basics information will already be in our data. Using this method the organization may save a lot of cost because it is free. Then, I can use postal method because the cost for stems is lower than conducting a survey. I can just print the information form and send it to them. Also, I can call them directly just to ask about their information. This method is also easier and cheaper than doing an extensive market research.
Consumer behaviour is the consideration in purchasing a product or services for personal consumption. In my opinion, the social class will be most influence in purchasing a new music CD. Social class are relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviours. Where they are from higher class or even lower class peoples. People from the higher class they will buy the new music CD because a new CD cost a lot. For example, a new CD of the singer Rihanna is around RM45 per CD. While the lower class will just download online and is free but the quality is not granted. Also, the social class people have higher taste for a product or services they consuming. A new music CD have higher quality in the music and audios. And they will be satisfied with the product.
Yes because the customers taste for the doughnut and their services are based on the characteristics of consumer behaviours. First are the cultural factors where because it is regional, each region they have their own culture of eating either they do eat expensive doughnuts or just the traditional doughnut. For example, in the rural area in Negeri Sembilan they prefer the traditional doughnut and they do not go for Dunkin Donuts or Big Apple. Secondly their behavioural also affected by the social factors where how the person are brought up in, their status, and also their interests. Consumers with higher class will get the expensive doughnut because either they are used to it or they have the money to buy it. For example people staying in Kuala Lumpur will buy doughnuts from Dunkin Donuts and Big Apple. Third is the personal factor where how the individual lives such as age, life cycle stage, occupation, economic situation, lifestyle, and personality and self concept. Some people buy things reflects him or hers personality where when someone is have higher taste in their personality they will choose the better quality ones so they will not lose their faces by buying a lower quality doughnut. For example Ali’s lifestyle is all higher class where they need good personality and this will encourage him to buy doughnuts from Dunkin Donut or Big Apple. Fourth is the psychological factor such as motivation, perception, learning, and beliefs and attitudes. In psychological factor people may influence another people to either buy or not buy the doughnut. For example, I will influence Ali to buy the cheaper doughnuts.
Buying a new notebook PC at Comp USA is a complex decision because we need to think about the cost and the brand differences while for the Jif creamy peanut butter at Wal-Mart are a variety-seeking decision where it involves low involvement such as lower cost and choose the brand we usually buy. For the new notebook we need to make some decisions. The first is awareness where someone aware of the new product but do not have much information about it. Second is the interest where the customer starts to take interest of the product and start searching for the information of the notebook. Third is evaluation where the buyer will consider which brand to buy. Fourth is trial where the buyer will go to Comp USA and try the notebook that him or her decided to look on. Then last but not least is adoption where the buyer decides the brand him or her wants and consume it. While for the peanut butter the decision making process is simpler where they need to know the needs of buying the peanut butter and of cause is to eat. And the buyer already knows the brand that they like. They may just go to Wal-Mart and take the Jif creamy peanut butter and pay for it without any considerations.
The market structure and demand of the business markets for Intel’s microprocessor chips are different than the final consumer markets when they have less number of buyer but with higher transactions and are regional while the consumers has more number of buyer and its globally. For example Intel’s microprocessor they only need to buy the thing to make the chip from each one supplier where it makes less in buyer while all consumers will buy things to use. Then is the derived of demand where the business buy things are depend on the consumers. For example Intel buys raw materials from supplier to make the microprocessor based on the demand of the customers they have each day. The price inelasticity also differ Intel with final consumer’s market structure and demand. For Intel, when the price increase the business will search for other supplier which is inelastic while the final consumers will still buy the product if they increase the price of the product or services. For example the supplier of the chip board to Intel increase the board’s price and Intel will start searching for other supplier but when Intel increase the price of their processor the consumers will still buy the processor. Other than that, the difference in demand fluctuations where in business they have higher fluctuation but final consumers they have lesser fluctuation. When the consumers increase demand in percentage, Intel’s demand will increase even higher in percentage than the consumers.
Decisions and the decisions processes for business markets are similar to consumer markets in terms of they are making decisions to buy something for them to use either for business or personally which includes thinking and choosing the right choice. In the other hand they have differences where in business decisions and the decision processes are more complex because they are buying things in higher quantity and higher cost while consumers buy things depends on what are they buying. For example Gardenia needs to choose the right supplier to buy the floor so it reach the quality that they want while for consumers they just need to choose either they want to buy Gardenia or Hi-5 bread. Then in business they have more formality where they need to have procedures to buy things with suppliers such as they need to know the details of the product specifications, written purchase orders, careful supplier searches, and formal approval of any buying while consumers need to just pay for the things they want to buy. For example in Cosway when they need to order some things from the head quarters they need to fill up forms of things they want to buy then fax it to the head quarters then they will send to the retailer while consumer can just go into Cosway and buy their product without any forms to fill, just pay for it. Also, in business each buyer and seller is more dependent on each other because what the buyer are producing they will buy the raw materials from the seller and in the same time gain profit from it while consumers are independent where they buy anything will not affect on other consumers. For example Gardenia buys their chocolate from Berry’s and they both depend on each other to gain profit where Gardenia needs the chocolates to make bread and Berry’s need to sell for profit while consumer A buys a bread will not affects consumer B either the bread is finish or not because they can either buy another brand or buy from other stores.
One of the three benefits of business-to-business e-commerce is they save ordering cost where using internet they do not need to post or fax where they save the cost from buying stems and ink and paper for fax. In the internet they can do ordering and purchasing the goods they wanted. For example ABC Ltd. save their general expenses cost for almost 20% for postal fees and also ink and paper. Second, they also reduce the time of processing order forms for delivering. Using traditional method the order form sometimes will not reach the seller on the right time and it will take a longer time to get the delivery. For example ABC Ltd. ordered computers from Dell for company use online and Dell manage to delivery their computers in 14 working days. Finally it also reduces paperwork on ordering and purchasing and they can concentrate in other paperwork in any department such as marketing or accounting. For example ABC Ltd. does their ordering online and the sales people manage to create more ideas in their paperwork in how to increase their sales.
If there are benefits there will also be some drawbacks. First is business can too easily search for suppliers where they will always find the supplier who goes with the specifications of the product and have lower cost and the firm will just easily change suppliers. This situation cost some other business to lose profit and income for their business. For example in e-commerce website they will state all the specifications in their webpage and all other suppliers may just go through it and propose to the company. Second is security where using internet to do business has lack security because the information of the company may just flown out because of fraud or hacking. This might cause loses for the company because the hackers may hack into their transaction accounts and steal all the money. Third is no strong relationship between the companies because they do not see each other to talk about the product they want to buy. This will make the supplier have the fear of losing their customers because of no strong relationship between them the buyers will just change to other suppliers. While if they have strong relationship they might consider and discuss for both side earnings.
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