Understanding of the market is often confusing because the term market have a variety of meanings. One can say about the capital market, the bird market, the bicycle market, used car market, the government market, and so on. Actually, what is the market? The use of the term "MARKET" can be applied in economic theory, in the business world in general, and in the field of marketing in particular. Therefore, we will get to know the definition of the market.
The first definition states that:
The market is a place where buyers and sellers meet and function, goods or services available for sale, and the displacement of property rights.
while the latter definition states that:
market demand is the sum of all goods or services by the buyer - potential buyers.
In particular the definition of the first state and there is a certain force that can determine the price, namely the convergence of buyers and sellers with the function they perform each. The term "market" in the definition of the latter is often exchanged with the term "demand", even often used together - the same as the market demand (demand maker).
Both of these functions are still considered a narrow definition and inadequate. Therefore, we will use the wider market definition (presented by William J. Stanton) following
So the market demand for some goods or services, there are three factors that need to be noticed. These three factors are:
· People with all his wishes
· The purchasing power of their
· Behaviour in their purchase
At the time of the manufacture of an item (goods economy), develop new services, or have a new idea to solve the problem - a social problem, they start looking for JV who are willing to use their creations. So, they have the potential to satisfy other people with something they have. Conversely, when a person has a desire to settle, he began trying to find others who are willing to satisfy them. So, he has the potential to use the results of the efforts of others. In accordance with the definition that a third of the market, then that can be maximized as the market is the second party (the person who uses the results from the efforts of others). But keep in mind also that the first party (who have the creation / something to use others) may also be intended as a market. This is because they can act as a second party on another occasion. So, in addition to offering something, they want something.
CHOOSE the intended market (TARGET MARKET)
To select the intended market (target market) companies can take three kinds of strategies, namely: (1) undiffirentiated marketing, (2) differentiated marketing, and (3) a concentrated marketing.
1. Undifferentiated MARKETING
In this strategy, the company is trying to develop a single product that can fulfill all or many people. Thus, the range of products marketed to everyone, not just one or a few groups only. Because the intended market is massive, the techniques of mass marketing was also character, for example using mass advertising. Such a strategy is not widely used by the company.
2. Differentiated MARKETING
This strategy is widely used by companies. Here, companies try to identify the group - specific buyer groups (market segment) by dividing the market into two or more groups. In the group of buyers can offer different types of products with other groups. So that the company may sell some products. Thus, in this strategy the company seeks to:
· Selecting subgroups / groups - groups that will serve him.
· Designing products that can give satisfaction to the group - the group.
3. Concentrated MARKETING
Here, the only company focused its marketing efforts on one or several groups of buyers only. Typically, this strategy be achieved by companies that do not successfully serving many buyers, so their marketing efforts only focus on the most profitable group of buyers. So that the company can develop products more ideal for the group.
TYPE - TYPE MARKET
Based on the motives of purchase of the buyer to buy a product, the market can be classified into five categories, namely:
· Consumer Market
· Market producers / industrial market
· Market vendor / merchant market
· Government Markets
· International markets
To know the obvious differences of each - each type of these markets, we will discuss based on the following four questions:
a) What was bought? (object)
b) Why buy? (objective)
c) Who is buying? (organization)
d) How to buy? (operation)
Keep in mind that each - each type of market is made up of people - people (views definition of the market in advance) both acting on behalf of private or on behalf of the institution / organization, and they are members of society who have needs, rights and the same obligations. Therefore it can happen that a person who is in the government market may also act as a consumer market, market producers or other market on another occasion.
1. CONSUMER MARKET
The consumer market is a group of buyers who purchase goods - goods for consumption and not for sale or further processing. Included in the consumer market is a buyer - the buyer or the buyer's individual and household (non-business).
-What are purchased? Purchased by the consumer market is consumption goods and services. Problems of goods and services will be discussed further in section three and section eight.
-why buy? consumers buy products because they want to fulfill their needs and want to feel satisfaction. While the emergence of the desire and the need is caused by several factors, such as: physical development, learning, social factors, and so on.
-on whom you buy? the purchase of consumer goods is people - those belonging to the consumer market. Each purchase can be made by one or several people. But the common presence of several people involved in the purchase of consumer goods. Those who are in one of these groups is called decision-making units. Despite being in one group, but they can perform different roles. It can also happen that this decision-making unit consists of only one person. Thus the decision-making unit can be defined as:
individuals or groups involved in the decision where the decision will assist them in achieving the goal, and they will bear the risk of the decision in grab it.
As for the parties - the parties involved in the decision-making units are: (1) initiator, the person who first suggested or have opinions / initiative to buy a product: (2) influencers, that is, those that affect the final decision in the purchase; (3) the decider, that the person who took the decision to buy (what, how, when, where to buy it?); (4) The Purchaser, ie making a purchase; (5) user, the person who uses the goods or services already purchased. Here is an example of the purchase of an item which the decision-making unit can be done either by a group of individuals and only one individual.
For the purchase of infant milk powder, a doctor can act as an initiator, influencer mother as father (who spend money) as a decider, their eldest son as the Purchaser, and as the user should the baby. For the purchase of pipe tobacco, a father can act as an initiator, influencer, decider, Purchaser, and sekaligur its user.
how to buy it? the purchase is not only one course of action, but a few measures which include a decision on the type of product, its shape, the brand, the amount, the seller, and the time and method of payment. It is much influenced by the purchasing habits of the buyers of one of these so-called impulse buying habits buying, ie the purchase of extemporaneous planned. Unplanned purchases can differentiate into; (1) Reminder buying, and (2) sugestion buying.
Reminder buying is unplanned purchases based on memory. For example: a student who goes to a shop tool - stationery to buy the paper folio, seeing that in the store there are pencils and pens contents. By looking at the contents of a pen and a pencil, he recalled that both kinds of goods are also in need because supplies at home have been exhausted. Then he bought it. Purchase like buying a reminder this call.
Suggestion buyer unplanned buying is based on a suggestion from others. For example: someone who buys fabrics in a textile shop because he is interested in a banner posted on the store porch. The banner states that all persons are requested to visit the store and buy cloth in tawarkannya, because it is a good opportunity to get a discount between 10% to 40%.
About where people make purchases, companies must be able to distinguish between where the purchase is done and where the plan and the decision to purchase is made. In general, for goods - goods that are expensive, purchase decisions are made at home (such as a car, a television, and so on). As for goods - goods that are not so expensive, or goods - goods that are less important, the purchase decisions made at point of sale. If the decision to purchase is made at home, hence its promotional efforts can be done by holding a letter advertising - newspapers, radio, television, or other promotional means to reach potential buyers at home. In the case of purchases made his decision on the point of sale, promotional efforts can be done by providing an attractive wrapper, the preparation of an attractive storefront, and so on.
Market producers, also called industrial market or business market, is a market that consists of the top individuals - individuals and institutions or organizations that buy goods - goods to be processed again until it becomes a final product which is then sold. Importance and complexity of these manufacturers market can be seen from some of the events in producing and marketing a product. We already know from the chapter in advance that industril marketing is one of the important aspects in the marketing system total. To obtain a clearer picture of market producers, the following is given some examples of buyers of business or industry:
* Agriculture, forestry and fishery
* Banking, finance and insurance
* Communication
* Construction
* Processing
* Mining
* Public services (public utilities)
* Service
* Transportation.
- what to buy? purchased by the market are manufacturers of industrial goods and services. Problems of goods and services of this industry will be discussed further in section three and eight.
-Why buy? industrial buyers purchase goods and services for the process again or to assist / facilitate his efforts with the aim to gain profit from the sale of their products. In general, demand for industrial goods is derived, means derived by other industrial goods or consumer goods which is derived from the industrial goods. For example: product demand - consumer products such as cars will create demand for industrial goods and services such as battery / batteries, glass, plugs, plastic for upholstery, engines, tires and so on. Thus, the demand components - such component is determined by demand for cars. While the demand for battery / batteries may create a demand for water batteries.
Demand for goods - goods industry is relatively inelastic, meaning that little price change causing greater demand. This is caused because normally an industrial goods made of several components, or be made to make other products. So the price change is a sensitive issue. In general, most of the motives of purchase of industrial goods is to be rational, especially for industrial goods that require large amounts of money volume. This is influenced by factors of a desire to profit from the industrial buyers. In addition, it is also influenced by factors of a desire to obtain the optimal combination of price, quality, and service of the products bought.
- Who is buying? to find a buyer - the buyer in the industrial market, can be reviewed on the groups - groups that play such purchases in the consumer market (unit of decision makers). At larger companies, the organizational structure there is a special purchasing department handles all kinds of purchases. Purchasing in itself, there are several employees with respective functions - each. Usually, decisions made by the Head of Purchase (as Decider). Can also purchase the decision to involve leaders (top managers), mainly for the purchase of goods that require a large amount of money. This situation is common in small companies or individual companies because everything is handled by the leadership.
- How to buy? industry competition and the complexity of marketing to encourage companies to focus his attention on the overall purchasing process, and trying to bring together the buyer and the seller. Some situations and stages in the purchase of industrial operations is shown by a frame / chart.
The model describes two aspects of the purchasing process industry, namely: (1) the situation of purchase, and (2) the stage - the stage of the buying process.
In a purchasing situation, there are three kinds of situation, namely: (a) a new task, meaning that first-time buyers will buy; (b) repurchase, means that the buyer has been to purchase the same goods. And will buy again for a second time or a third time; (c) the purchase of the continuous, that is, the buyer has repeatedly make the purchase the same goods. In relative terms, the situation of the first purchase (new task) is often the most difficult and complex than others. In this case, the buyer need more information because of the new first purchase. If the required information is obtained directly on the seller, it will be easy for sellers to influence it.
In the third situation (continuous purchase), the buyer does not need a lot of information, and decision making is also easier because it is a routine task. While the repurchase (second situation) is between the first and third situation in terms of time is needed to make decisions, the information necessary, various alternatives should be considered, and so on. Another aspect of the framework of the buying process is in the form of stage - the stage that should be done by the buyer in the purchasing industry. The stage begins with knowing a problem and ends with the assessment of the results of purchase.
Seller's market is a market that consists of individuals - invidu and organizations that acquire / purchase goods with the intent to be sold or leased in order to make a profit. They are often called merchant or company - trading company. In terms of geo graphic spread, they are more and more spread in the appeal by the manufacturer, but more grouping than with consumers.
- What was purchased? purchased by a seller's market, there are two kinds, namely: (1) The goods to be sold again; (2) the goods and services to carry out operations.
Thus, goods - goods and services purchased by sellers market belonged industrial goods, such as those purchased by market producers. Only goods that are not in the process of purchasing, but sold again, the role of a seller's market is very important if a product is not marketed directly to consumers by the manufacturer.
- Why buy? as well as market producers, market sellers also want to make a profit from his business. For that they tried to buy goods - goods at low prices and sell at high prices. In this case, the seller must know the various sources / or provider to get some alternative pricing, promotion costs, as well as service at some level. It is intended to achieve the purpose of profit or gain a satisfactory income.
- Who is buying? the big trading company, the purchase of a specialized function and is usually handled by a separate section called the Purchase section. While the trading company or a small distributor, the situation is not so. Here, the purchasing function often performed by people who also perform other functions. For goods - goods that require large volumes of money, purchase only done or decided solely by the leadership. Something similar is encountered also in market producers.
- Like a Where to buy? in making a purchase, the market is trying to find a provider AAU sellers the best producers. Thus, their buying activity in priority to choose a provider. They also need to consider factors - other factors, such as: payment terms (including the duration and magnitude of cuts), services, and promotional assistance from the provider.
Government market is a market where there are government agencies, such as: departments - departments, directorates, offices - offices, and other agencies. To follow the development or progress of time, hampier every year there is an increase in the purchase of goods and services by the government.
- What is purchased? the government buys goods and services for the purposes in areas: land, education and culture, public works, health, social welfare, and so on. In this case, the government buys everything to carry out functions - the functions in the government or anything related to the field - the field. As for the goods and services that de purchase can be: airplanes, guns, paper, fuel, chalk, cement to build the dam, construction services, banking services, and so on. In general, all of these can be inserted into the group of consumer goods and industrial goods.
- Why buy? the government buys goods and services with the objective interests and the welfare of society (civil servants and the general community). In addition, the government also incurred costs for the purposes of the business field to help, nurture, and promote entrepreneurs (especially entrepreneurs economically weak), the contract - a contract companies, and setting an industrial location.
- Who makes? organization or government agency that purchases can be divided into two groups, namely: (1) the central government, and (2) the local government. The central government is the largest group, and the purchasing unit can distinguish between the civilian sector and the military sector. Purchases in the military sector is mainly used for defense purposes.
- How to buy? purchases by the government can be done through two kinds of procedure, namely: (1) to offer an open and (2) with a contract agreement. In this case purchases by publicly offer, the government must choose a provider of good quality. Whereas in the case of purchase of the contract, the government should choose a contractor who is willing to give all possibilities of the most profitable. All of this is intended to avoid losses - losses that are not desirable.
International market covering several or all countries in the world. If Indonesia to sell oil to other countries, then the oil price we pay is higher, it is caused due to a reduction in the supply of oil in the country. This oil is used for industrial purposes, industry in need of remedy makes goods (steel, for example), and steel needed to make the car. When oil prices rise, the price of steel will rise. Similarly, the price of the car. This is only one example of trading of the international market.
· What was purchased? purchased by the international market can be goods and services industry.
· Why buy? international market to purchase goods and services to meet the needs of one's life, to get profits by selling again, rent or processed into other goods for sale. In addition, the purchase of goods and services are also intended for the benefit and welfare of the community.
· Who will buy? Here, purchases can be made by the individual buyer or buyers of household, industrial buyers, institutions - government agencies, and traders see buyers at the fourth base in advance!). it can be said that the international market is a combination of fourth kind upfront market.
· How to buy? because those who sell goods / services in another country, then the purchases made by the buyer / market (country) must be through international trade procedures which include the activities of export - import. In this case, the buyer is involved in import activities.
Without importing rice from other countries (such as Japan) basic needs (food) Indonesian people will not be met during this time (in Pelita III The government began trying to self sufficient in rice). Manufacturers can not operate effectively without importing materials - materials such as wheat (for bread), cotton (for textile), steel plate (for ships), component - motor vehicle components, and so on. The government can provide the level of security and well-being are higher in people with importing weapons, equipment, and modern infrastructure such as armored vehicles, satellites, fire truck, tool-tool electricity irrigation and power generation, and so on. In contrast, other countries will not enjoy a better standard of living without oil, tobacco, wood and so they buy from Indonesia. In this regard, Indonesia needs to maintain a balance between the level of export by focusing on a favorable balance. , For several years Indonesia has reached a level favorable balance between export and import. Even the last few years, the number of export is much greater than its imports.
MARKET SEGMENT
A production-oriented enterprises generally regard the market as a whole as a unit that is homogeneous and single undiferentiated. According to this concept (called the overall market), management will develop a product and a marketing program that is planned for the consumer as possible. Overall market (market aggregation) provide opportunities for companies to maximize the scale of production, physical distribution, and promotion economical. Companies that manufacture and market the product can do for a long period with the cost per unit lower. Inventory costs can be minimized because it does not provide a wide range of colors, patterns and sizes. Storage and transportation businesses more efficiently. In addition, advertising costs per unit were lower for one kind of product, rather than some kind that promoted.
By the time the competition has become increasingly fierce and the management was forced to lower the price resulting profits decline, then the company must try to distinguish its products from products - rival products. This concept is called differentiation of the products (product differentiation). With this concept, the company tried to introduce traits - new features include: new packaging (butter in cans replaced with a tube), the new size (small cigars), new flavors, or a new color. Introduction - typical characteristics of this new product is often accompanied by high expenditures for promotion.
In fact, many products are heterogeneous for the entire market, meaning that the product is only required by a particular market group. For example, women's clothing, is not needed by groups of men. Thus, market women are homogeneous groups for women's clothing.
WHAT IS THE MARKET SEGMENT?
Market segmentation is dividing activity - for heterogeneous market of a product into the unit - the unit market (market segment) that is homogeneous.
This market segment is a consumer-oriented philosophy. Thus, the consumer-oriented companies will divide the market into specific market segments, where each segment is caused by differences in buying habits, how to use the goods, the needs of users, purchase motive, purpose of purchase, and so on.
MARKET SEGMENT BENEFITS
By linking marketing program targeted to segments of the target market, management can carry out marketing activities better and can use resources more efficiently marketing. For a small company with the resources that are very limited can compete in certain market segments. In detail it can be said that market segmentation can assist management in:
· Channelling money and effort into the potentially most lucrative market.
· Designing products that can meet market demand
· Determine ways equally effective promotion for the company
· Choosing a better media advertisements and determine how better to allocate the budget to various media
· Set the time as well as possible in an effort promotions
While the reasons for the company to conduct market segmentation are:
1. The market is dynamic, not static. This means that in the market there is a continuous change of attitude, the cycle of life, family situation, income, geographic patterns, and so on.
The market for a product change according to the product life cycle, from the introductory stage to the stage of decline. Product life cycle issues (product life cycle) will talk about this later on part three.
Companies that hold a segmentation of the market may take a couple of different ways. Such methods also differ from one product to the other. One important way to conduct market segmentation is to divide the market into several types such as discussed above. Because there are differences between each - each type of market is the company's marketing program (product, price, distribution, and promotion) is also different depending on whether the company sells to the consumer market or other markets.
Actually, in extreme fifth upfront market types can be grouped into two categories, namely the end consumer and industrial users. Including the end consumer market segment that buys goods and services for personal or household. While industrial users include agencies / organizations either for-profit or not, who buy goods and services for the benefit of the organization or to make others . Besides goods company, in this industrial users including hospitals, supermarkets, institutions - government agencies, and so on.
In the following discussion, we will focus on the consumer market segmentation issues. Basic - basic in use to hold the consumers market segmentation will be linked to the three components of the market (see the definition of "upfront market"). So, the market is:
1. People with all their needs. In this case we are going to segment the market by using a basic / demography factors such as:
· Distribution of the population on a regional basis
· Population density
· Age
· Gender
· Cycle of family life (family life cycle)
· Lai factors: race, religion, nationality, education, employment.
2. Having money to spend
· Distribution of income used for spending.
3. And the willingness to spend. This factor concerns the purchasing behavior of consumers, consisting of:
· Grouping sociologically:
a) cultural groups
b) Class - a great social class
c) Small groups, including the family
· Psychological factors (psychographic) such as:
a. Personality
b. Attitude
c. Benefits of the desired product
d. opinion
e. way of life
Factor number 2 and 3 will be discussed later in the next chapter.
With the division of the market into several segments in advance, then the purchasing behavior can only be in the know in accordance with the existing factors. Often also used a combination of several factors, even a single variable. For example, a segment identified as a group of women aged 65 or older, living in the middle Djawah, married, have children young, and have income levels below Rp 2.000.000, - per month.
In addition, combining these can also be due to the relationship between several factors. For example, the level of income with the level of education, age and life cycles and so on.
As with the consumer market, industrial market also needs to be segment-kan, with the goal of developing an effective marketing program for the company to achieve industrial users. Some of the factors that can be used as a basis for segmentation include:
· Business fields
· The purchasing power (can be measured from the production volume, the volume of activity, and sales volume).
Well so you can share this time on the market, may be useful to meet again