Fundamentals of Marketing Chapter 1 Section 3

Market All potential customers who share the ability and willingness to buy the product. Example: Everyone who buys a video game is part of the over $7 billion video game market. It is very important to identify your market.

Consumer VS Industrial Markets Consumer market Consumers who purchase goods & services for personal use Industrial market Business to business (B-to-B) Businesses who buy products for use in their operations Most related to improving profit

Market Share % of total sales volume generated by all companies that compete in a given market Knowing their market share helps Marketers analyze their competition Their status in a given market

Market Segmentation Analyzing a market by specific characteristics in order to create a target market. Once a target market is identified, a business can customize its products and marketing strategies to that specific group of customers. To do this, businesses may segment a market by demographics, psychographics, geographics, and product benefits.

Target Market Target Marketing -- Involves focusing marketing decisions on a specific group of people you want to reach with your product. The more information you have on your target market, the easier it is to make marketing decisions.

Customers vs. Consumers Customers buy the product. Consumers use the product. Example: For Sony, the customers are the retail stores and the consumers are the actual people who buy the product from the retailer and use it. Example 2: A parent buys a kids cereal and is the customer but the consumer is the child the parent is buying the cereal for. Sometimes you are both the customer and the consumer. If you buy someone a gift you would be the customer and the person that receives and uses your gift is the consumer. Successful marketers satisfy both the customer and the consumer.

Customer Profile A combination of information that helps to paint a picture of your target market. Can include information about age, income level, ethnic background, occupation, attitudes, lifestyle, or geographic residence of the targeted customer. Knowing a customers profile helps you to make intelligent marketing decisions.

The 4 P’s of the Marketing Mix The Marketing Mix is comprised of four basic marketing strategies, collectively known as the four P’s. The Marketing Mix is dependent on how well the target market is defined and how well all strategies are directed toward that target audience!

The 4 P’s of the Marketing Mix Product Place Price Promotion All 4 areas must interconnect to be effective

Product Knowing what product to make, how to package it, what brand name to use, and what image to project.

Place Determines how and where a product will be distributed. Determining transportation methods & what stock levels are most effective

Price Nike Men's Shox TL 2 $149.99 Should reflect what customers are willing and able to pay. Retail price, discounts, allowances, credit terms, payment period Nike Men's Shox TL 2 $149.99

Promotion Decisions about advertising, personal selling, sales promotion, & publicity How will potential customers be told about a product, message, media selection, special offers, & timing of promotional campaigns

Who’s Your Market? $2000 Yorkie Puppy McDonalds Guitar Hero Tickets to Miley Cyrus Honda Civic Dillards Dolce & Gabbana