The paper 'Customers, Markets and Products & Their Importance" is a perfect example of marketing coursework. Customers are individuals who buy products/avail services of companies for a price. Example, a person buying a car/getting hair-cut in the salon. Customers are important as they are the main drivers of the market and economy. They are the ones for whom products are made. The market is a location where buyers/sellers gather to buy/sell goods/transact over the product(s). Example, consumer markets (products like Soft drinks), business markets (Iron ore sold to manufacturing companies).
Markets are important because they identify a fixed place where buying/selling can occur. Markets differentiate commercial place from residential (non-commercial) place. Products are finished goods produced by companies. Example, Pen. Products are important because they are of value to customers as it satisfies their needs, wants and demands in return for a price. Product-to-suit markets are markets profiled into groups of buyers preferring varying products/services after examining their demographics/behavioral patterns. A segment with the greatest opportunity is ‘ Target Market’ and a corresponding market offering made is ‘ Positioning’ . Example, Fairness creams for women.
Product-to-suit markets important because every customer has distinct demands and preferences; due to which a need to divide markets into segments. Trading Internationally Why trade internationally: To gain access to new markets and customers (for increased revenues, profits, long term growth). To cut costs and enhance competitiveness (through increased volume of sale achieving economies of scale and learning curve effects). To leverage its core competencies To spread its business risk across a wider market base (economic downturn in one country’ s economy may be evened out by buoyant sales in another country). To achieve ease of raw material supply (which is in abundance outside home country). How to trade internationally: Export strategies: Maintain national (one-country) production base and export to foreign markets using company-owned or foreign-controlled forwards distribution channels. Licensing strategies: License foreign firms to use the company’ s technology or to produce and distribute the company’ s products.
Suited for manufacturing companies. Franchising strategy: Suited for service and retailing companies like McDonald’ s, Pizza Hut, KFC etc. The franchisee bears cost and risk of establishment whereas; the franchisor only extends resources for recruitment, training, supporting and monitoring the franchisees. Multi-country strategy: Varying the company’ s strategy from one country to another as per the local conditions and buyer’ s tastes and preferences. Global Strategy: Standard competitive strategy approach in all country markets where the company has a presence. Strategic alliances or joint ventures: Entering foreign markets through alliances with foreign companies and also for strengthening and maintaining competitiveness. PEST Analysis Why PEST analysis: It represents the Political, Economic, Social and Technological environment of an organization.
This analysis is basically the analysis of the external environment of a company. These external forces are beyond the direct influence and control of the organization but exert significant influence on their functioning.
Its study helps an enterprise better adapt to these environmental forces. What is a PEST analysis? Political Environment – refers to the general state of political development, degree of politicization of business and economic issues, level of political morality, political stability, political ideology & practices of ruling party, extent and nature of governmental intervention in economy and industry, the public attitude towards business etc.