The Market
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The market comprises all potential customers for a product or service. It's made up of individuals, businesses, or organisations that have a specific need or want, and the monetary means to satisfy it.
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The size of a market is determined by the number of potential customers and the overall value they represent in terms of sales. This can change over time due to various factors, such as population growth, economic conditions or changes in preferences.
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Market segmentation divides a market into distinct groups that share similar needs and characteristics. These segments can be based on demographic, geographic, psychographic (lifestyle and personality) and behavioural factors.
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Targeting involves picking one or more of these segments and developing products that specifically meet their needs. For a business to effectively do this, it first needs to understand who its target customer is, what they want, how they behave and what motivates them.
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Positioning is how a product or service is differentiated in the mind of the customer. Companies aim to create a unique image or impression in the customer's mind regarding its brand or product.
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Market orientation refers to a company's approach to doing business. A market-oriented company bases its products and operations around the needs and wants of its customers, constantly adapting to market trends and consumer demands.
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The marketing mix, also known as the 4Ps (Product, Price, Place, Promotion), is a tool that businesses use to meet the needs of their customers. Each 'P' represents a specific tactic that can be modified to reach a company's target market effectively.
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Product refers to what a business sells. In order to meet customers' needs, a product must be of high quality, reliable and innovative.
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Price is the amount that customers are willing to pay for a product. It determines a company's profits and must be set in a way that provides value to customers, while also covering production costs and delivering a profit.
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Place refers to how, where, and to who a product is sold. Having a product available in a location or format that's convenient for customers is crucial.
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Promotion is how a business communicates with its target market. Promotions can include advertising, public relations, sales promotions and direct marketing.
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Customer satisfaction is crucial for business success as it often leads to repeat purchases, positive word of mouth and customer loyalty. It's achieved by meeting or exceeding customer expectations.
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Businesses often use market research to understand their customers. This helps them to design and deliver products that meet customer needs more effectively. Research can take a variety of forms, including surveys, focus groups, and web analytics.
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A business's marketing strategy plays a crucial role in how they meet customer needs. This strategy forms the basis for all marketing decisions and drives the company's efforts to satisfy its customers.
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Products life cycle consists of introduction, growth, maturity and decline stages. At each stage, the needs and preferences of customers can change, so businesses must adapt accordingly.