Marketing, competition and the customer

Marketing, competition

and the customer

• Marketing is much more than just advertising and selling the goods and services of a business.

• Think about something that you’ve bought recently.

• What persuaded you to buy it?• An advert? A salesperson? Perhaps a friend?

The role marketing• Business activity involves more than just coming

up with an idea for a product or service, making it and then selling it!

• This may include identifying or even predicting what they require.

• Then the business has to produce exactly what customers want.

• Finally managers need to make sure that they have satisfied customer requirements.

Identifying and satisfying customer

needs• The main role of marketing is to convert the

wants of an individual into a need.

• Businesses often use promotional activities, especially advertising, to persuade consumers that something they want is a need.

• Business sales, revenue and profits will rise.

Maintaining customer loyalty

• Customer base: The group of customers a business sells its products to.

• Build customer relationships to maintain the loyalty of its customers to the business and its products.

Building customer relationships

• The marketing function must then aim to keep these customers.

• This requires collecting as much information as possible about each individual customer.

• E.g. income, lifestyle and buying habits.

• Better identify and satisfy customers’ needs and carefully target individual customers with information about the firm’s products.

Market changes• Market: All customers and consumers who are

interested in buying a product and have the financial resources to do so.

• A market is a place where buyers and sellers come together to buy and sell goods and services.

Definitions• Target market: Individuals or organisations

identified by a business as the customers or consumers of their products.

• Customer: An individual or business that buys goods and services from a business.

• Consumer: the final user of a product.

• Consumer markets: markets for goods and services bought by the final consumer.

Definitions• Industrial markets: markets for goods and

services bought by other businesses to use in their production process.

• Business environment: The combination of internal and external factors that influence the operations of a business.

Why consumer spending patterns

change• The business environment is constantly changing.

• The price of the product

• The price of competitors’ products

• Changes in consumer income

• Changes in population size and structure.

• Changes in tastes and fashion.

• Spending on advertising and other promotional activities.

• Activity 10.1

• Activity 10.2

Changing customer needs

• If a business is to survive in the long run, it has to respond to any change in customer needs.

• It is easy to see how and why a business that produces and sells fashion items, such as clothing.

• Activity 10.3