Fundamentals of Business and Marketing Strategy

Item 7: Business and Marketing

1. Basics of Marketing

1.2. Strategic and Operational Marketing Strategies

Marketing strategy is the set of activities focused on understanding consumer needs. Operational marketing involves the set of activities that lead the company to develop a sales strategy.

1.3. Need, Desire, and Demand

• Need: A basic deficiency or lack, inherent in the human condition. Types of needs include physiological and psychological.
• Desire: How a specific need manifests itself for a specific item. Desires are multiple and vary over time.
• Want: The materialization of a desire (the specific product sought).

1.4. Value, Cost, and Satisfaction

Cost is the monetary value of a product. Satisfaction is the degree to which a product conforms to the buyer's expectations or values. A product can be expensive but may not satisfy the buyer.

2. Sales

2.1. Definition and Commercial Functions

The commercial function is to define who, how, when, and to whom to sell for profit. The functions of the sales department can be primary and secondary.

2.2. Goals and Objectives

• Study the market to determine its characteristics, especially regarding the level of competition.
• Meet the needs of consumers.
• Set sales targets and implement strategies.

3. The Market

A market is constituted by a set of buyers and sellers of a product. The relationship of the company with the market is essential for its activity to be useful in providing goods and services to the consumer.

3.1. Current Market and Potential Market

The current market is the turnover the company is currently achieving at a particular time. The potential market is comprised of the maximum amount of sales that the company can achieve in a given time.

3.2. Market Classification

Markets can be classified based on several criteria:

According to Buyer Rate:

• Consumer market (e.g., food).
• Industrial market.

Based on the Number of Competitors:

• Monopoly: There is a unique company that operates in the market.
• Oligopoly: Few companies exist for the same product.
• Monopolistic competition.
• Perfect competition: Many sellers trade a homogeneous product; the price is balanced.

Depending on the Degree of Novelty:

• First hand (new).
• Second hand (used).

According to Geographical Area:

• Local
• Regional
• National
• International

4. Competition

We define competition as anything that can claim to have caused the company to lose business. It can be divided into two types:

• Direct: Offers the same product as our company.
• Indirect: Offers substitute products.

5. The Demand

Demand is defined as the quantity of products or services that buyers are willing to purchase during a given time period.