Nature and purpose of marketing (01)

Question 1

SUMMARY

Answer 1

In summary, the following are covered in this topic:

1. Marketing is about identifying the particular needs and wants of target-
   audience customers and then trying to satisfy these needs better than competitors.
2. A market refers to a group of customers who is interested in a product, has the
   means to buy it, and is allowed to buy it. There are essentially three types of
   market; consumer, business and government.
3. Marketing indices are statistical tools to track and measure changes in specific
   marketing data over a particular period. They include market size, market
   growth and market share.
4. The three marketing perspectives are production concept, product concept and
   marketing concept.
5. The product concept focuses on producing goods and services, followed by an
   attempt to sell them.
6. The production concept assumes that consumers prefer widely available and
   inexpensive products, with focus on achieving high production efficiency, low
   costs and mass distribution.
7. The marketing concept focuses on identifying and meeting the needs and wants
   of consumers, based on market research.
8. Marketing objectives are important as they provide a sense of direction to the
   Marketing department, as well as form the basis of the marketing strategy.
9. Marketing objectives include gaining market share, improved profitablity,
   increased brand awareness and changing attitudes of customer.

Question 2

What is included in marketing indices?

Answer 2

-Market size
-Market growth
-Market share

Question 3

Why is market size important?

Answer 3

 A marketing manager can determine whether a new market is worth entering
or not.
 Businesses are able to calculate their own market share
 The growth or decline of the market can be identified.

Question 4

Market share formula

Answer 4

Sales of business in time period / Total market sales in time period x 100%

Question 5

Why would businesses aim to have high market share

Answer 5

 Sales are higher as compared to its competitors, and this could lead to higher
profits.
 Retailers will be keen to stock up and promote the best-selling brands. The
brand leaders are also likely to be displayed at eye-level on shelves, or at
prominent positions in shops.
 Businesses could tap on the fact that they are brand or market leader, and used
it in advertising or other promotional materials. Customers are often keen to
buy the ‘most popular’ brand.