Consumer markets

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Consumer markets
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Consumer markets are markets where the products and services available to the general consumer are predominant and purchased for consumption, not resale. The generally accepted categorization of products on this market is food, transport products, consumer products, and retail products. Consumer markets are an increasingly important part of the market as world trade develops (E.Kaynak, S. Hassan, 2014, p. XIX)

Due to a large number of buyers and discrepancies in their purchasing preferences, product requirements or tastes, market segmentation is applied. It is aimed at grouping customers in such a manner that they have similar needs and similar patterns of behavior during shopping and selection of products or services. The distinction may be made, for example, on the basis of demographic or psychological characteristics. This process includes stages such as market definition, segment profit determination, segmentation base selection, but also market deficit and marketing strategy implementation (V. Jadczaková, 2013, p.1215)

A strong impact on the consumer markets has marketing practice which is called branding. Branding is about creating a brand that is recognizable to all buyers, through elements such as, for example, a distinctive logo or a name. These components make the brand stand out from the competition which has a positive impact on consumers purchasing behavior (S. Mudambi, 2002, p. 525-526).

Characteristic of consumer markets

Consumer markets are characterized by certain features relating to the buyers, sellers, relationships between buyer and seller, to available products or to the way in which products are advertised (S. Mudambi, 2002, p.527).

  • The products available on the consumer markets is normalized and comparatively simple
  • In this type of market, the connections between consumer and vendors are impersonal
  • The main type of advertising that consumer markets rely on is advertising on the mass market reaching the largest number of potential customers
  • When making a purchase decision, the emphasis is placed on the tangible product and intangible assets
  • Costumers on the consumer market, as a result of the development of the global economy, have more and more demanding demands on the quality of available products and are more sophisticated, which affects the competitiveness of sellers
  • Consumer markets are highly competitive. Many of the same or similar products and services are offered by different companies. Customers who are constantly gaining experience in buying usually expect high quality at a relatively low price. Therefore, sellers must take care to create a brand and gain the trust of customers so that it is their products that enjoy the greatest popularity
  • An important issue for the sellers on these markets is also the risk related to the fact whether a given product or service will be popular in the future.

Examples of Consumer markets

  • Fast-Moving Consumer Goods (FMCG): These are everyday items such as groceries, toiletries and household cleaning products that have a short shelf life and are quickly consumed. Examples of FMCG include soap, toothpaste, soft drinks, packaged food, cigarettes and alcohol.
  • Durable Goods: These are items that are used for a longer period of time and can be reused multiple times. Examples of durable goods include cars, furniture, electronics, white goods and sporting equipment.
  • Luxury Goods: These are items that are purchased for their high quality and are often seen as status symbols. Examples of luxury goods include designer clothing, fine jewelry, watches and high-end electronics.
  • Services: These are intangible products that are consumed at the same time as they are produced. Examples of services include healthcare, transportation, financial services and hospitality.
  • Business-to-Business Markets: These markets involve selling products or services to other businesses for their own use, rather than for the end consumer. Examples of business-to-business markets include manufacturing, technology, telecommunications and professional services.

Advantages of Consumer markets

The advantages of consumer markets are numerous and include:

  • Increased access to goods and services from a variety of sources: Consumer markets provide customers with more choices and access to a wide variety of goods and services. For instance, customers can now shop online for items that may be difficult to find in their local stores.
  • Improved pricing due to competition: Consumers benefit from competitive pricing as businesses compete for their attention. This means that customers can often find discounts and lower prices on products, which ultimately leads to more value for their money.
  • Increased convenience: Consumer markets offer convenience for customers by providing them with easier access to goods and services. For example, customers can purchase items from the comfort of their own home and have them delivered to them in a timely manner.
  • Greater customer service: Companies in consumer markets strive to provide customers with the best possible service and experience. This includes providing helpful customer support, responding quickly to inquiries, and offering a wide range of products that meet customer needs.

Limitations of Consumer markets

The limitations of consumer markets can vary from product to product and from market to market. Some of the main limitations include:

  • Limited availability of resources: Consumer markets are limited by the availability of resources such as land, labor, capital, and technology. Depending on the country, these resources may be difficult to come by.
  • Limited purchasing power: Many consumer markets have limited purchasing power due to lower incomes or limited access to credit. This can limit the types of products that can be marketed to those consumers.
  • Limited education: Consumer markets may have limited education levels, which can limit the effectiveness of marketing and advertising efforts.
  • Limited competition: Consumer markets are often characterized by limited competition, which can limit the available options for consumers and limit the ability of marketers to reach their target audiences.
  • Cultural influences: Cultural influences can play a significant role in consumer markets, as different cultures may have different preferences for products and services. This can limit the appeal of certain products and services to certain consumer markets.

Other approaches related to Consumer markets

Marketing to consumer markets is a complex process that involves many approaches. It is important to consider all potential strategies to ensure the best reach and results. These include:

  • Product Development: Product development involves creating a unique offering that appeals to a target market. It includes researching what the customer wants and developing a product to satisfy their needs.
  • Pricing Strategy: Pricing strategy is an important part of marketing to consumer markets, as it can help to attract and retain customers. Companies must determine how much to charge for their product or service, and whether discounts or other incentives should be offered.
  • Advertising and Promotion: Advertising and promotion help to create awareness of a product or service and encourage customers to purchase it. This can include using traditional media such as print, television, and radio, as well as digital media like social media and search engine optimization.
  • Distribution: Distribution refers to the method of getting the product to the customer. It may involve using brick-and-mortar stores, online channels, and other outlets.
  • Customer Service: Customer service is an important part of marketing to consumer markets, as it helps to ensure customers have a positive experience. This includes providing prompt, helpful responses to inquiries and complaints, as well as offering support after the purchase.

In summary, marketing to consumer markets involves many strategies, including product development, pricing strategy, advertising and promotion, distribution, and customer service. It is important to consider all of these approaches to ensure the best reach and results.

References

Author: Gabriela Jopek

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