Transcript
APPROACHES TO STUDY MARKETING
Submitted bySameera ShamsudheenIIIrd sem M.sc IFRoll No. 14
FUNCTIONAL APPROACH
Functional approach studies marketing in terms of many activities performed in getting products from Producer to Consumer.These activities are called Functions. They are performed by cooperative and private marketing firms.
The following functions are widely accepted for classification purposes:
Exchange – Buying and SellingPhysical - Processing, Storage &
TransportationFacilitating -Standardization, Financing, Risk
Bearing & Market information
EXCHANGE FUNCTION
It takes place through out the market channel & includes buyers bidding for supplies of commodities & sellers offering commodities at the best price which they can attain.
The buying function include locating supplies of the commodity & assembling them for shipment.
The selling function varies depending on what stage of the marketing channel the product is in. it includes : packaging, labeling, advertising, promotion and all other merchendising activities.
PHYSICAL FUNCTION
It adds form, time & place utility to the product.
Processing adds form utility to the product.
Storage adds time utility.
Transportation adds place utility.
FACILITATING FUNCTIONS
It improves the performance of marketing system by increasing operational and pricing efficiency.
Standardization is the establishing of grades and of quality criteria for a commodity. This function makes it possible for the buyers to know what exactly they are buying without any personal inspection of the goods.
The risk bearing factor falls on the commodity owner who is faced with possible losses due to Physical and market risks.
Physical risk is the risk of loss due to Quality deterioration or destruction.
Market risk is the risk borne by commodity owners of a possible adverse price movement.
Market information involves collecting, analysing and disseminating information. It is necessary for smooth operation of the price system.
If buyers and sellers are well informed about the factors that affect supply and demand, prices will be well established that more nearly clear the market.
MARKET STRUCTURE APPROACH
Market structure analysis emphasizes the nature of market competition and attempts to relate the variables of market performance to types of Market structure and conduct
Market structure is the description of number and nature of participants in the market.
Examples of such dimension include: number and size distribution of buyers and sellers in market; the degree of product differentiation; and barriers to potential entrants.
Market conduct deals with the behavior of the firms.
Firms that are Price searchers are expected to act differently than those in Price taker type of industry.
Price searchers can determine their selling prices or quantity of output they will sell.
In addition they could also use their market power to eliminate or weaken competitors.
THANK YOU
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