“A place where two or more parties are engaged in selling or buying of products, services or information is termed as a MARKET.“ And, the two parties involved in the exchange are known as the “Seller” and the “Buyer”.
The seller sells goods and services to the consumer/buyer and gets money in exchange. A market to be competitive, there has to be more than one buyer and seller.
There are two main market conditions: Monopoly and Monopsony.
1. Monopoly – In this market condition, there is a single seller and multiple buyers at the market place. In monopoly, the seller is the dominant with no competition from others and hence enjoys complete control over products and services. In this condition, the seller fixes the price of goods or service and has the power to change on its own.
2. Monopsony – A market condition where there is a single buyer but many sellers is termed as monopsony. Since in such a set up, there is a single buyer against many sellers, he/she can exert his control on them which means that buyer here has an upper edge over the sellers.
Different Market Types:
1. Physical Market- A set up where buyers can meet the sellers physically and buy the desired product or service from them in exchange of money. Examples of physical market include shopping malls, retail stores and department stores
2. Non-Physical Markets/Virtual markets – In this market set up, buyers buy goods and services online. Here, the buyers and sellers do not interact physically or meet; rather the exchange is done through internet. For example, Flipkart, eBay, etc.
3. Market for Intermediate Goods – Sellers sell raw material in these markets required for the final production of end products.
4. Auction Market – In an auction market, the seller sells his products or services to the highest bidder.
5. Black Market – A setup where illegal goods such as drugs and weapons are sold.
6. Knowledge Market – In such a set up, the exchange of information and knowledge based products is done.
7. Financial Market – Market dealing with the trade of liquid assets (money) is called a financial market.
Financial markets are of following types:
• Stock Market – A market form where buyers and sellers exchange shares.
• Bond Market – In such a set up, the buyers and sellers are involved in the exchange of debt securities, usually in the form of bonds.
• Foreign Exchange Market – Here, parties are engaged in trading of currency. In a foreign exchange market, one party exchanges one country’s currency with equal quantity of another currency.
• Predictive Markets – A set up where exchange of products or service takes place for future. The market status determines the status of the buyer; the buyer is in profit when the market rises and is at a loss when the market crashes.
Size of the Market
The market size is based on two factors:
Number of sellers and buyers
Total money involved annually.
Defining Marketing for the 21st Century
It’d be no wrong to say that the 21st Century has the beginning of the new economy. The credit goes to the technology innovations and development.
Peeping back into the past, the Industrial revolution is known as the beginning of the old economy that focused entirely on producing enormous quantities of standardized goods. This mass product was crucial for satisfying large consumer base and cost reduction as increased production enabled the companies to expand into new markets across geographical areas. The ancient economy comprised of organizational hierarchy in which the top management instructed the middle managers over the labors.
In contrast, the new economy revolves around the buyers completely, thanks to the digital revolution. Buyers can access all types of information about the product and services. Moreover, there’s no more standardization, instead there is a lot of customization with a dramatic rise in product offering. The new economy has also seen a great transformation in the purchase experience of the customer and commencement of online purchase, aiding the buyers with 24 × 7 product purchase getting delivered at office or home.
Also Read: What is Marketing Research?
Organizations have also taken benefits of available information and are designing more efficient marketing programs as per the customers’ demand. Digital revolution has led to the rise in communication speed using mobile, e-mail SMS, etc. These transformations have greatly helped he companies in taking faster decisions and execute strategies more swiftly.
As far as the business market is concerned, awareness and of product is very essential for marketers as businesses keep on looking for ways to establish or maintain a credential in their respective market. For world market, marketers have to think about cultural diversity and the international trade laws, trade agreement, and regulatory needs of individual market. For organizations with constrained budgets, importance is related to pricing of products, hence companies have to design and sell products accordingly.
21st century and digital revolution have made organizations make significant changes in the way they conduct their business. One common yet major trend in the 21st century is the need of stream lining the systems and processes with the focus on cost reduction through outsourcing. Simultaneously, the marketing people look out for ways to build long term relationship with the purchasers. This relationship sets up platform understanding consumer needs and picks. Apart from this, marketers consider distribution channels as partners in business and not merely as the customers. Organizations and marketers are making decisions through various computers simulated models.