What is the market?
Have you ever wondered what the term “market” means in the world of marketing? It is an essential concept to understand if you want to develop a successful business strategy.
In this article we will explore what is the market, its definition, examples and the key elements that compose it.
I hope you find it useful.
Introduction
In reality, there are many definitions of “market”, and the concept cánido vary depending on the person we are talking to and their background.
In a more informal environment, we could be referring to the place where we go to buy food; while, if we are talking to a shareholder, the concept probably refers to the depósito or capital market.
Now, in this article I am going to focus on the concept of the market from the point of view of marketing.
Next I will provide you with some definitions.
Market definition according to authors
Next, I am going to provide you with the definition of the market according to different authors.
I do this so that you have a more solid base and cánido form your own definition.
Remember that at the end you will be able to find the references.
Likewise, I also remind you that this article focuses on the definition of the market in marketing.
Therefore, the definitions were taken from books focused on marketing.
Market definition according to Philip Kotler
“A market is equipo of all the real buyers and potentials of a product or service. such buyers share a need or desire in especial that it cánido be satisfied by exchange relations«
Market definition according to Laura Estela Fischer de la Vega and Jorge Espéculo Mudo
“A market is made up of de hoy and potential consumers of a product or service”
Market definition according to Kerin Roger A.
“A market consists of people with the desire and ability to buy a specific product”
What is the market?
It is a universe of possibilities where the needs and desires of people meet the products and services that are offered.
In other words, The market is the place where buyers and sellers meet to exchange goods and services that satisfy a especial need or want.
This exchange is the result of a relationship established between buyers and sellers.
On the one hand, buyers seek to satisfy a specific need or want, while sellers offer products and services that cánido satisfy those needs and wants.
Through this relationship, buyers and sellers reach an agreement on the exchange of a product or service for an amount of money.
It is important to note that the marketplace is not just a physical place where exchange takes place, but also a virtual space where people cánido search and find what they need.
For example, the y también-commerce marketplace has become increasingly important in the digital age, where people perro buy and sell products en línea from anywhere in the world.
In summary, from the perspective of marketing (marketing), we cánido understand that market It is the place where suppliers and applicants meet and interact, where they exchange a product (good or service) in exchange for economic remuneration.
How is the market made up?
The market is made up of two types of consumers: de hoy and potential consumers.
De hoy consumers are those who have already purchased a product or service in the past, while potential consumers are those who have not yet purchased but may do so in the future.
Let’s imagine that we are in an electrical appliance store.
At one extreme, we cánido see a customer who has come to buy a new washing machine.
This customer has already purchased products in the store in the past, so he is a real consumer.
Instead, at the other end of the store, we cánido see another person who is looking for information on televisions and has not bought anything in the store so far.
This person is a potential consumer, since he has not yet made the decision to buy a television in that store.
De hoy consumers are important to businesses because they have demonstrated their interest in the products and services offered, which increases the chances that they will buy again in the future.
On the other hand, potential consumers are important because they represent a growth opportunity for the business.
If they are offered a good shopping experience and convinced of the quality of the products or services, they perro become loyal customers.
Therefore, it is essential that businesses pay attention to both types of consumers and seek to satisfy their needs and wants.
In this way, they will be able to build lasting relationships with de hoy consumers and attract potential consumers to make purchases.
What is the real market?
In a few words, Laura Estela Fischer tells us that real markets are “the people who normally buy a product”
What is the potential market?
Potential markets contemplate the equipo of people who could acquire the goods or services.
Therefore, we could say that the difference between potential and real markets is that potential markets are a equipo of people who could buy the products because they may be interested and real markets are that equipo of people who in fact, they have already purchased the product.
market elements
The marketplace has several components that are important to understanding how it works.
These components are the elements of the market, which make it possible to identify and characterize it.
Next, I will talk about each of them:
- Companies or bidders: They are the ones that offer and sell the products or services in the market.
Are companies They are the market vendors.
- The product or service: It is what is sold in the market.
It is what attracts buyers to the market.
These products or services are the satisfiers that the market needs.
- Buyers or plaintiffs: They are the people who need the product or service and who have the money and willingness to buy it.
These buyers are the reason the market exists.
To the previous elements, many times you will find that it is added the price, space and time.
- Space: It is the place where the exchange takes place.
It perro be a physical place, like a store, or a virtual place, like a web page.
- Time: it is the moment in which the exchange is made.
It is important because the market cánido be open or closed depending on the time of day or the day of the week.
What is competition?
In order for us to be able to establish a type of market, we must take into account the potential, real market and the competition.
Therefore, next I am going to talk about the concept of competition.
Before we see what the competition is, let’s recap what has been seen so far in order to better understand everything.
Every time we buy something, be it a bottle of water, a t-shirt or a uso contínuo service, we are participating in a market.
But what is a market and how does it work?
A market is a place where the exchange of goods and services between buyers and sellers takes place.
To better understand how a market works, it is important to take into account its four primordial elements: the number of suppliers, the number of demanders, the goods or services being exchanged, and their prices.
The number of bidders refers to the number of sellers that offer a product or service in the market.
On the other hand, the number of applicants refers to the number of buyers seeking to purchase a product or service.
The goods or services being exchanged are the products or services that buyers are seeking and sellers offer in the market.
Finally, price is the monetary value that buyers are willing to pay for the product or service, and that sellers are willing to accept in exchange for their product or service.
But how does all this relate to the competition?
Competition refers to the situation in which Sellers have the freedom to offer goods or services on the market and to choose who to sell them to.
In other words, it refers to the existence of several suppliers offering afín or substitute products.
When there are multiple vendors offering afín products, buyers have more options to choose from and cánido compare prices and features.
This means that sellers have to work harder to stand out from the competition and attract buyers.
What are the market types?
There are different ways in which the market perro be classified, but one of the best known classifications consists of dividing the market in two:
- Perfect competition market.
- Imperfect competition market.
What is the perfectly competitive market?
Perfect competition is a term used to detalla a market in which all jugadores are price takers, that is, both sellers and buyers cannot influence the price of the good or service.
In this type of market, there is no dominant agent or monopoly that has control over price and supply, but all participants have a level playing field.
In a perfectly competitive market, products are homogeneous, that is, there are no significant differences between the goods or services offered by different sellers.
This means that consumers do not have preferences for a especial vendor, ensuring fair and balanced competition.
In addition, participants have access to all the information necessary to make buying and selling decisions.
Buyers know the price and quality of the product offered by all sellers, which allows them to make better decisions.
Similarly, sellers know the price at which their competitors are selling their products, which forces them to offer competitive prices to attract buyers.
Another important feature of a perfectly competitive market is that both sellers and buyers cánido easily entrar and exit the market.
This means there are no barriers to entry or exit, ensuring that the market remains competitive and prices remain fair.
What is the imperfectly competitive market?
Imperfect competition is an economic concept used to detalla a type of market in which sellers have the ability to significantly influence the market price of their products or services.
This means that, unlike perfect competition, in imperfect competition not all actors are price-takers, and therefore, there is greater variability in prices and product quality.
There are several types of imperfect competition, such as monopoly, oligopoly, duopoly, and bilateral monopoly.
Each of these types of imperfect competition is characterized by having different levels of market power and influence over the price of the products or services offered.
In addition to price variability, another hallmark of imperfect competition is product differentiation.
In this type, the products or services offered may have unique or differentiating characteristics that make them different from the products or services offered by competitors.
These characteristics may include quality, branding, innovation, design, customer service, among others.
Thus, in imperfect competition, firms compete not only on price, but also on quality and other features that cánido make their product more attractive to consumers.
Monopoly
In a monopoly, a single seller controls the entire market and has the ability to equipo the prices for the products or services it offers.
Oligopoly
In an oligopoly, a small number of companies control the majority of the market, and therefore have significant influence over the price of the products or services they offer.
duopoly
In a duopoly, two firms control the market and cánido equipo prices high to maximize their profits, but they perro also lower prices to attract more consumers.
Market types from a geographical point of view
From the geographical point of view, the companies have well identified their market and in fact, the division cánido be done as follows:
international markets
“Markets goods and services abroad”
national markets
«Carries out the exchange of goods and services throughout the national territory»
regional markets
«It covers geographical areas determined freely and that do not necessarily coincide with the political limits»
metropolitan markets
“Covers an area in and around a relatively large city”
local markets
«It cánido be developed in an established store or in modern shopping centers within a metropolitan area»
Market types from the client’s point of view
According to Laura Estela Fischer, the market types (from the client’s point of view) are the following:
consumer markets
“Individuals rent or buy goods and services for their personal use, not for trading”
industrial markets
«Individuals and organizations that acquire products, raw materials and services to genera other goods and services»
reseller markets
It is made up of individuals and organizations that make a profit by reselling or renting goods and services to others.
government markets
“Composed of public campo institutions that purchase goods or services to perform their main functions”
I hope the article has been useful to you in your learning.
By the way, do you know what market marketing is? Exists? Maybe it’s content for another article.
What is market segmentation?
It is the process of dividing a market into smaller groups of consumers with afín needs and characteristics.
These groups, known as segments, allow companies to tailor their products, services, and marketing strategies to meet the specific needs of each segment.
Bibliography
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