TOPIC 6

CONCEPTS OF MARKET
Presentation Outline
MARKETING CONCEPTS
MARKETING STRATEGY
A. MARKET STRATEGY PLANNING
B. TARGET MARKETING
THE SIGNIFICANCE OF MARKET
RESEARCH
TYPES OF MARKET RESEARCH
MARKET SHARE FORECASTING
FORECASTING COMPANY SALES
Marketing Concepts
Guide for small business
owners
Emphasizes matching:
- Intended customers
- Product or service offerings
Goal: satisfy customer needs
effectively
Key Marketing Questions
1. Who are my customers?
2. What products or services are needed by my customers?
3. At what price are the products or services required?
4. At what place are the identified products or services
required?
5. At what time are the identified products or services
required?
6. At what mode of delivery are the identified products or
services required?
Firm Actions

1. devise a marketing strategy;

2. engage in a marketing research;
and
3. identify the size of the target
market.
Marketing Strategy
Marketing Strategy is the general guide
the Small Business Owner (SBO) will
use to achieve the firm's marketing
goals.
It is a plan for getting products and
services into the hands of customers in
timely, cost-effective, and appropriate
manner.,
 Two Components of
Marketing Strategy

Marketing
Strategy Planning

Target Marketing
 Marketing Strategy Planning

Market strategy planning is a small business activity which

seeks to find attractive opportunities and develop
profitable marketing strategies.
Recognized the strength and weaknesses
Analyze external environment
Ouput: Marketing Strategy
 Target Marketing
Target marketing refers to the activity of selecting well-defined
groups of potential customers and tailoring a marketing mix to their
specific needs and preferences.

In target marketing the following steps are undertaken:

Identification of the Measurement of

Identification of
characteristics of the size of the
Target Market
the Target Market Target Market
 Identification of Target Market

A target market is defined as the particular market

segment the firm wishes to serve. This segment is
singled out from an array of market segments the
firm has chosen to serve.
 Before Deciding on the
Target Market
Before the market segment to be served is identified, the SBO must
first decide on the number of segments he wishes to serve. As such,
the firm could be any of the following:

Multi ssegment
Mass market company Mass segment
company
Sells goods and company
Aims to sell at two or
services to a broad Aims to sell to a single
more distinct market
spectrum of buyers market segment
segments
 Choosing the Target
Market
When deciding on which market segment to reach, it is necessary for
the SBO to consider the following:
1. the goods or service category of the firm;
2. the firm’s goal;
3. what competitors are doing;
4. the size of the various segments;
5. the relative efficiency of each segment to the firm;
6. the resources required; and
7. other factors.
 Identifying th e ch ara c ter istics
of the T arge t M a rk et
To effectively serve the target market, its characteristics must be known to the SBO.
Relevant characteristics will refer to any of the following:
age
sex
family size
family life cycle
income
occupation
religion
race
nationality
 Measuring the Size of the Target
Market
In the attempt to make a match between the firm and the target market, the SBO
must be provided with information about the following:

[Link] of potential customers

Provide the means ascertaining the most economical approach to reach them
Help in deciding whether or not to continue adapting to the target market.

[Link] Growth trend of the Market Area

Growing markets offer several dvantages.
One of them is expanding sales potential.
 Significance of Market Research
Knowing the needs of target customers will be very
helpful in designing the right marketing mix. To describe
the customer, market research is the right tool to use.

Two Basic Types of Marker Research

1. Primary Research
2. Secondary Research
 Primary Research
The firm could obtain primary data
about the potential customers and
competitors through any of the
following methods:
1. observation;
2. survey; and
3. experimentation.
 Primary Research

1. Observation Method
Collecting data by observing
the actions of a person or group
of persons
No direct interaction with the
subject being studied
 Primary Research
2. Survey Method
Consists of gathering data by
interviewing people. This may be
undertaken through any of the following
techniques:
Personal Interview
Telephone Survey
By Mail
By the Internet
 Primary Research
Personal Interview
The most expensive and time consuming
Requires face-to-face communication
Arrangements must be made for respondents
Superior when in-depth opinions are required
Telephone Interview
Information can be collected quickly at the least cost
Applicable mostly in urban areas
Requires: sound questionnaire, representative sample group, Courteous
telephone interviewers
 Primary Research
By Mail
Used when telephone surveys are not feasible
Offers convenience to respondents to complete at a convenient time
Advantage depends on effective functioning of the post office
By Internet
Questionnaires posted on a firm’s website or sent by e-mail
Offers quick replies from respondents
Lower cost of data collection
Main disadvantage: difficulty in verifying respondents’ identity, affecting
reliability
 Primary Research

3. Experimentation Method
Observing the results of
changing one variable
All other conditions held
constant
 Secondary Research
Secondary research uses information previously gathered by
other persons or institutions to satisfy their own specific
requirements.
The possible sources of secondary data are the following:
1. the company’s records;
2. libraries; and
3. government agencies.
 Secondary Research
1. Company's Records
Company’s internal records are important sources of information
Sales reports provide clues on customer behavior
Example: Opening a new branch may shift majority of customers to
the new location
Indicates customer preferences such as:
1. Patronizing the nearest branch
2. Comfort with new employees
 Secondary Research
2. Libraries
Libraries provide useful information for small businesses
Include studies, trade journals, magazines, theses, and government
reports
Key sources:
1. Philippine Yearbook
2. Top 1,000 Corporations
3. Profile of Philippine Industries
 Secondary Research
3. Government Agencies
Government agencies provide information to assist various users
Commission on Higher Education and Department of Education:
data on schools, courses, and student numbers
Department of Trade and Industry: data on enterprises, government
programs, services, and financing options
Local governments: records and listings of business establishments
by area and type
 Market Share Forcasting
Market share refers to the individual firm’s sales as a
percentage of the total sales in a specific market.

Formula:

CMS = CS ÷ TIS
Company Market Share = Company Sales ÷ Total Industry Sales
 Market Share Forcasting
5 Steps to Determine Market Share
1. Determine the physical limits of the target market area.
2. Determine the potential sales of the target market considering its
demographic characteristics.
3. Determine the purchasing power of the target market.
4. Determine the total sales revenue of the industry in the target market area.
5. Determine the percentage of the total sales that can be effectively served
by the
company.
 Forecasting Company Sales
7 Forecasting Sales Method
[Link]-Factor Analysis – Forecasts sales by analyzing key market factors (economy, trends) and
their effect on demand.
[Link] of Buyer Intentions – Asks customers how much they would buy at a certain price to
estimate demand.
[Link] Marketing – Launches a product in a small area, measures sales, and projects for the larger
market.
[Link] Sales Analysis – Uses previous sales data with a growth rate to predict future sales.
[Link] Analysis – Uses statistical trends or seasonal patterns to forecast short- or long-term sales.
[Link]-Force Composite – Aggregates sales estimates from salespeople in different territories.
[Link] Judgment – Relies on opinions of executives to predict future sales.
[Link]: These forecasts help the company estimate its market share, the portion of total market
sales it can capture.
Conclusion

Marketing concepts help businesses

understand customers and match their
needs with the right products or services.
Through target marketing, market research,
and sales forecasting, entrepreneurs can
plan effective strategies and improve their
chances of business success.
THANK YOU FOR LISTENING