Marketing involves identifying and understanding customers needs and wants
Businesses can then provide products and services that meet these needs PROFITABLY
Marketing is about UNDERSTANDING customers.
Businesses need to think about Marketing in order to:
- reduce risk of product failure
- understand their customers
- communicate product effectively to encourage customers to buy them
- keep up to date with market trends so products can continue to meet customers needs
The Marketing Process
A Market Segment is a group of customers in a market that have similar characteristics and needs.
E.G. You can segment the car market by the type of car a person drives, such as sports, executive, people carrier etc. Sports car drivers are likely to have different needs to people carrier drivers.
Market segmentation helps businesses:
- Carry out market research
- tailor products to customer needs
- target promotions at a specific groups
Market Research is gathering information about customers, competitors and market trends by collecting primary and secondary data.
The three stages:
Step 1: Planning and designing the research
- What are the aims of the research?
- What research techniques could you use?
- Should you use primary or secondary, qualitative or quantitative data?
Step 2: Doing the research?
- What are the time limits for the research?
- What is the sample size?
Step 3: Analysing the information
- Did people make the same or different comments?
- Could you identify any trends in the data?
A business must get customers through the door so that they try the products for the first time.
Methods used to do this include:
- Low trial prices
- Viral Marketing e.g. Facebook
- Public Relations
- Free Samples
Repeat Purchase and Customer Loyalty
Businesses aim to keep customer loyal, so that they make repeat purchases. This will generate sales and revenue.
Methods that might be used to do this include:
- special promotions
- reminder adverts
- product innovations
- customer loyalty schemes (loyalty cards)
The cost of retaining customers can be less that that of attracting new ones