M/SCHEME:(CBM 007) ESSENTIALS OF MARKETING
Question 1.
I. Classification of Market on The Basis of Geographical Area
Market can be classified in local, regional, national and international level on the basis of
geographical area:
Local Market
The market limited to a certain place of a country is called local market. Perishable consumer
products such as milk, vegetables, fruits, etc are sold and bought in local markets.
Regional Market
The market which is not limited to a certain place but expanded in regional level is called
regional market. Mostly, food grains such as wheat, paddy, maize, millet, sugar, oil etc are
bought and sold in such regional market.
National Market
If buying and selling of some products is done in the whole nation, this is called national market.
The products such as clothes, steel, cement, iron, tea, coffee, soap, cigarette, etc are bought and
sold nationwide.
International or Global Market
Market cannot be limited to any geographical border of any country. If the goods produced in a
country are sold in different countries, this is called international market.
Classification of Market on The Basis Of time
On the basis of time, market can be divided in very short-term, short-term, long term and very
long-term market.
Very Short-term Market
The market where shortly perishable goods are sold is called very short-term market. The market
of milk, fish, meat, fruits and other perishable goods is called very short-term market.
Short-term Market
In the short-term market, supply of products can be increased using the maximum capacity of
installed machines of the firm.
Long-term Market
In long-term market, adequate time can be found for supply of products according to demand.
Very Long-term Market Or Secular Market
In secular market, produces can get adequate time to use new technology in production process
and bring new changes in products.
Classification Of Market On The Basis Of Competition
On the basis of competition, market can be classified into monopoly market, perfect market and
imperfect market.
Monopoly Market
If there is full control of producer over market, then such market is called monopoly market. In
such market, the producer determines price of his products in his own will. In such market, only
one producer or seller controls market. In practice, the producer or seller can supply products or
achieve monopoly on price only in small or limited area, but in wide area it becomes impossible.
Perfect Market
The market where the number of buyers and sellers is large, homogeneous of products are
bought and sold, same price of similar type products is determined from free interaction between
demand and supply is called perfect market
Imperfect Market
The market where there is no perfect competition between buyers and seller is called imperfect
market. In this type of market, customers are affected by product discrimination.
b) informative advertising; Aims at informing the buyers about the exixtence of products
Persuasive advertising; Aims at convincing the customers to purchase the products.
Reminder,advertisement; Aims at reminding the customers over existence of the products.
C. AMA (1960) - "Marketing is the performance of business activities that direct the flow of
goods and services from producer to consumer or user."
Functions of marketing
• Buying, Selling, Transporting, Storing, Standardizing and grading, Financing, Risk taking etc
Question 2
There are a number of different philosophies that guide a marketing effort
Phillip Kotler categorized the five major marketing eras that have evolved throughout time
which form the philosophies that a company adopts.
The Production Era
One of the oldest concept eras, it holds that consumers will favor those products that are widely
available and low in cost. Managers of production-oriented organizations concentrate on
achieving high production efficiency and wide distribution.
The Product Era
This era brought about marketing beliefs that consumers will favor those products that offer the
most quality, performance or innovative features. Marketing managers focus on making superior
products and improving them over time.
The Selling/Sales Era
During this era, the primary marketing concept belief held that consumers if left alone would not
buy enough of the organization’s products; therefore, the organization must undertake an
aggressive selling and promotion effort. The selling concept assumes that the consumer must be
coaxed into buying. It also assumes that the organization has effective selling and promotional
tools to stimulate more buying.
The Marketing Era
Evolving from and challenging the first three concept eras of marketing, this era holds that the
key to achieving organizational goals consists of being more effective than your competitors in
integrating and coordinating marketing activities toward determining and satisfying the needs
and wants of your target markets.
The Societal Marketing Era
The newest to evolve, it holds that the organization’s task is to determine the needs, wants and
interests of target markets and to deliver the desired satisfaction more effectively and efficiently
than competitors in a way that preserves or enhances the consumers’ and the society’s well
being.
Relationship Marketing Era
The Relationship Era is the latest period in marketing's ongoing evolution. Relationship
marketing has been defined as "the ongoing process of identifying and creating new value with
individual customers and then sharing the benefits from this over a lifetime of association. It
involves understanding, focusing, and managing ongoing collaboration between suppliers and
selected customers for mutual value creation and sharing through interdependence and
organizational alignment."
Question 3
3 External Environment of Marketing.
External factors are beyond the control of a firm; its success depends to a large extent on its
adaptability to the environment.
The external marketing environment consists of: Macro environment, and Micro environment
a) Micro environment: The environmental factors that are in its proximity. The factors
influence the company’s non-capacity to produce and serve the market. The factors are:
Suppliers, Market Intermediaries, Customers, Competitors and Publics:
Macro Environment:
Macro environment factors act external to the company and are quite uncontrollable. These
factors do not affect the marketing ability of the concern directly but indirectly the influence
marketing decisions of the company.
These are the macro environmental factors that affect the company’s marketing decisions:
1) Demographic Forces;Marketers are keenly interested in the size and growth rate of
population in different cities, regions, and nations; age distribution and ethnic mix;
educational levels; households patterns; and regional characteristics and movements.
2) Economic Factors: The economic environment consists of macro-level factors related to
means of production and distribution that have an impact on the business of an organization.
3) Physical Forces: Components of physical forces are earth’s natural renewal and non-
renewal resources.
4) Technological Factors: The technological environment consists of factors related to
knowledge applied, and the materials and machines used in the production of goods and
services that have an impact on the business of an organization.
5) Political and Legal Forces: Developments in political and legal field greatly affect the
marketing decisions. sound marketing decision cannot be taken without taking into account,
the government agencies, political party in power and in opposition their ideologies,
pressure groups, and laws of the land
6) F) Social and Cultural Forces: This concept has crept into marketing literature as an
alternative to the marketing concept. The social forces attempt to make the marketing
socially responsible.
