Essay on Market: Meaning, Concepts and Types

After reading this essay you will learn about:- 1. Meaning of Market 2. Concepts of Market 3. Types.

Essay on the Meaning of Market:

A market, in common parlance, means a place or locality where things are brought and sold and where buyers and sellers personally meet to affect purchase and sale. However, for a student of economics, the term market has no reference to a place, where things are bought and sold. It refers to a commodity and buyers and sellers of that commodity (e.g., wheat).

In fact the market must be thought of not as a geographic place but as any getting together of buyers and sellers in person, by mail, telephone, telegraph or any other means of communication. A market is a group of existing and potential buyers or users of a product or service. Marketing is the one function of management which has to be more concerned with what is going on outside the organization than with what is happening internally.

Every business organization has its market, that is to say, the group of existing and potential buyers or users of its goods and services. A market may consist of a mere handful of people (e.g. specialist collectors of a certain type of antique items) or it may consist of millions (e.g. consumers of breakfast eatables).

Essay on the Concepts of Market:

The various concepts of marketing developed so far are discussed below:

(1) Distribution of goods and service concept:

It is a traditional concept of marketing according to which marketing is an economic activity that facilitates the distribution (or flow) of goods and services from producer to consumer. This concept has no concern with the production activities of the goods.

(2) Delivery of standard of living concept:

According to this concept, marketing includes all those activities that create and give a better standard of living to the society.

The producer tries to know the customer’s needs and plans his production accordingly. In this way, customers get quality goods at cheaper rates and thus better standard of living is delivered to the society.

(3) Creation of utility concept:

Marketing is an activity that creates form, place, time and ownership utility.

To elaborate, marketing consists in moving goods from the manufacturer, in a form in which they are required at a time when they are required, to the place where they are to be used and for those who are to use them for various purposes.

(4) Generation of revenue concept:

Marketing should generate revenue or income for the firm. Marketing consists of all activities which are performed with a view to allow the firm to earn maximum profit not by increasing the selling price, but by reducing production and selling costs and other overheads.

(5) Social system concept of marketing:

Marketing is a total system of interacting business activities designed to plan, price, promote and distribute, want satisfying products and services to present and potential customers which are a part and parcel of society.

(6) Concept of customer satisfaction – modern concept:

The modern concept of marketing emphasises the identification and the complete satisfaction of customer’s needs.

It is based on two fundamental concepts:

(i) That the company policies and operations should be customer oriented and

(ii) That the goal of the firm should be profitable sales.

Essay on the Types of Markets:

The markets may be classified on the following basis:

(a) The product sold in the market:

E.g., cloth market, jute market, share market, grain market, etc.

(b) Nature and volume of selling:

E.g., a wholesale market, where goods are sold in large quantities to dealers, and a retail market where goods are sold in small quantities to consumers.

(c) The nature of dealings:

E.g., a spot market where goods are bought and sold immediately and a forward/ future market where actual purchasing and selling may take place at some future time/date as agreed by the buyer and the seller.

(d) Regulated and Municipal markets:

A regulated market is one that is controlled by an association. If the municipality owns and controls the market, it is called a municipal market.

(e) Area covered:

Depending upon the area covered, it may be a home/local market, national market or an international market.

(f) Time-interval:

Depending upon the time interval, it may be a short period market (e.g., money market) or a long period (or term) market (e.g., capital market).

(g) Economic concept:

On the basis of economics, it may be a perfect market or an imperfect market. Perfect market refers to perfect competition and imperfect market refers to absence of perfect competition and existence of monopoly.

(h) Seller’s position:

Depending upon seller’s position, it may be a primary/local market, secondary/central market or a terminal market.

In the case of local market farmers sell their surplus produce to traders in the village. In the case of central market, wholesalers sell to retailers and in the case of terminal market, consumers buy from retailers or local dealers.