Unit 5  Markets

Objectives  List the four characteristics of a market.  Explain the difference between the consumer market and the business market.  List the four categories of customers in the business market.

Objectives  Distinguish between a consumer and a customer.  Describe the difference between a mass market and a market segment.  Explain why marketers segment a mass market.

Marketing Terms  market market  consumer market consumer market  business market business market  consumer consumer  B2C B2C  B2B B2B  producer producer  reseller reseller  institution institution  government government  mass market mass market  market segment market segment  marketing strategy marketing strategy

A Group of Buyers  A market is a group of peoplemarket  who want a product and  are able to buy it What qualities should a market have?

A Group of Buyers  Characteristics of a market  need or want the product  able to buy the product  willing to buy the product  have the authority to buy the product Give an example of a group who might want a product, but not be able or have the authority to buy it.

Consumer Market vs. Business Market  Two types of markets  consumer market consumer market –people who buy products for their own use  business market business market –people who buy products for use in a business

The Consumer Market  Consumer Consumer  member of the consumer market  buys products for his or her own use  buys groceries, clothes, cars, gifts, and other consumer goods and services

The Consumer Market  The consumer market is also called B2CB2C Business sellingtoConsumers

The Business Market  The business market consists of  businesses who buy products –from other businesses  A customer in the business market  is another business  The business market consists of businesses  The consumer market consists of individual consumers

The Business Market  The business market is also called B2BB2B Business sellingtoBusinesses

The Business Market  The three uses for business products  making new products  resale  running the business Give examples of each business use.

Types of Business Customers  Four types of customers in the business market  producer  reseller  institution  government

Types of Business Customers  Producer Producer  makes goods and services  farmers, manufacturers, mining, and construction Name some businesses that are producers.

Types of Business Customers  Reseller Reseller  buys finished products –to sell at a profit  also called retailer Name some businesses that are resellers.

Types of Business Customers  Institution Institution  nonprofit corporation  school, hospital, or charitable organization Name some institutions.

Types of Business Customers  Government Government  organizations and institutions that run a geographic area –such as a country, state, or city  includes federal, state, city, and county governments

WORKOUT  Complete Consumer Market or Business Market assignment.

Customer vs. Consumer  The term consumer has more than one meaning 1. member of the consumer market 2. person who actually uses (consumes) the product  The customer (the person who buys the product) is distinguished  from the consumer (the person who uses the product)

Customer vs. Consumer  In the consumer market  a parent buys food for his or her child Who is the customer? Who is the consumer?

Customer vs. Consumer  In the business market  a purchaser buys computers for the accounting department Who is the customer? Who is the consumer?

Market Segments  Think of everyone who drinks cola beverages  All the cola customers are a mass market  All the customers for a type of product are called a mass marketmass market

Mass Market for Colas  A mass market consists of all the customers for a type of product

Market Segments  Does everyone in the cola market want the same kind of cola?  List subgroups by types of cola that people want.

Market Segments  A market segment is a subgroup of a larger marketmarket segment  everyone in a market segment has similar needs and wants for a particular product  the needs of one market segment are different from the needs of another market segment  Market segmentation is the process of dividing a large mass market into smaller market segments.

Caffeine-free Diet Caffeine-free Regular Diet Regular Low Carb Segmented Market for Colas

Choosing Your Target Market  It is very difficult to meet the needs of all the customers in a mass market  Market segmentation can help a business find a target market  it is usually easier to select a target market and –meet the needs of that smaller market Choose a market and give at least two market segments for that market.

Segmentation and the Marketing Concept  The marketing concept says that the best way to make a profit is  by satisfying customers’ needs and wants  Targeting a market segment helps businesses follow the marketing concept  It is easier to satisfy customers  if marketers target a market segment –in which all customers have the same wants and needs

Marketing Strategy  A marketing strategy is themarketing strategy  selection of a target market and the –development of a marketing mix to meet the needs and wants of the target market Marketing Strategy Marketing Mix + = Target Market

WORKOUT  Complete B2B handout.

Review  What is the difference between the consumer market and the business market?  Describe the three types of uses for business products.  List the four types of customers in the business market.  What is a market segment?

Glossary  B2B. Business selling to business.  B2C. Business selling to consumers.  business market. Customers who buy products for use in a business; also called industrial market, organizational market, or commercial market. Back

Glossary  consumer. Member of the consumer market; customer who buys products for his or her own use.  consumer market. Customers who buy products for their own use.  government. Consists of the organizations and institutions that run a geographic area, such as a country, and includes federal, state, county, and local governments. Back

Glossary  institution. Nonprofit corporation, such as a school, hospital, or charitable organization.  market. Group of people who want a product and are able to buy it.  marketing strategy. The selection of a target market and the development of a marketing mix to meet the needs and wants of the target market. Back

Glossary  market segment. Subgroup of a larger market; this subgroup has similar wants and needs for a particular product.  mass market. All the customers for a type of product considered together. Back

Glossary  producer. Business that makes goods and services.  reseller. Business that buys finished products to resell at a profit. Back

WORKOUT  Complete Unit 4 test.