consumers in both the Business and the Consumer Market

 Markets can be critically examined via the product itself, or end-consumer, or both.  And the most common distinction is between consumer and business markets. To also understand the types of consumers in both the consumer and business market we need to firstly define who a consumer is? And in this case a consumer according to Phillip Kotler looks at a consumer as the ultimate user of the product or service; the consumer may not have paid for the product or service

Let’s for instance consider the following:

• A food manufacturing business makes own-label, Ghanaian ready meals for the major supermarkets.

• So far as the business is concerned, the customer is the supermarket to whom it supplies meals

• The consumer is the individual who eats the meal.

In terms of its marketing effort, who should the business above target?

In reality, it needs to understand the needs and wants of both the customer and the consumer.

It needs to develop a strong understanding of the needs of the supermarkets in terms of their requirements for ready meals (e.g. packaging, recipes, price & delivery).

It also needs to understand (perhaps with the help of the supermarkets) the needs and wants of the consumer. How are tastes changing? Are consumers happy with the standard / taste of the product?

The consumer Markets of today are experiencing rapid changes and is flooded with new opportunities and new challenges.

The significant changes in the consumers' buying behavior, urbanized lifestyle and growth of service sector are the main reasons behind the changed scenario in the consumer market.

The Consumer Market can be classified into following type of markets:
This market comprises of the markets for different consumer products. This includes market for consumer durables, FMCG (Fast Moving Consumer Goods), consumer electronic goods, domestic electrical appliances, cosmetics, jewelry, furniture, air conditioners, bicycles and apparels.
In Consumer Products Market aggressive marketing is required because the customers of consumer product market lack in loyalty and tend to shift from one brand to another very quickly. The consumer products market is characterized by high level of competition among the sellers.
The companies are continuously engaged in modification of business models and business activities to match up with the changing consumer needs. Moreover, the norms of WTO (World Trade Organization) are resulting in various mergers, alliances and tie-ups among the companies. The companies are being compelled to go for these alliances to remain competitive and to exist in the market because, losing the competitive edge will ensure complete market exit.
• Food and Beverages Market
This market consists of the sub-markets like markets for dairy products, bakery products, packaged food products, Beverages, Confectionary, Beer, Alcohol, meat and poultry products.
This type of Consumer Market is full of growth opportunities because of changing lifestyle of present era. Consumer Awareness and Brand Loyalty of customers help this market to grow to a different high.
• Retail Market
The Retail Market comprises of the Supermarkets, Departmental Stores, Food Chain Outlets, Specialty Stores and Franchise Sores.
This type of Consumer Market is discovering new business opportunities with each passing day because of the rapidly changing lifestyle and spending pattern of the people. Even in the suburban areas and in small towns, Departmental Stores are coming up from the big retail chain houses as westernized lifestyle and western culture is making their presence felt all over the world. This type of market generates low profit margins but has high growth potential. To utilize this growth potential, companies need to modify their business activities in accordance with the changing lifestyle and changing consumption trends of the customers. If the customers receive enough value for money, only then they will be loyal to the brands and will make repeated purchase.
• Transportation Service Market
This type of Consumer Market consists of Postal Services, Courier Services and Logistic Services.
Transportation Service Market is generally dominated by a large no. of medium and small enterprises and a few no. of large enterprises. Companies in this type of market essentially require brand name and strong distribution network and significant amount of capital investment. With emergence of technology based advanced facilities like e-commerce and with the increasing use of internet, new horizons are opening for this type of market.
The companies can utilize the advantages of reduced costing, improved customer relationship and accelerated movement of materials and can go for strategic tie ups with international business houses. This way, they can make proper use of the new business opportunities which has been generated by the rising level of Foreign Direct Investment and Economic Growth around the world. (Source Economy Watch November 23, 2010)

On the other hand, the business market encompasses organizational entities that purchase goods and services for the “use in the production of other products and services or for the purpose of reselling or renting them to others at a profit.”
Business markets possess a smaller amount of large buyers, unlike the consumer market, and whose consuming traits are “more geographically concentrated.” Dependent on the type of buyer and consumer, characteristics through decision processes may differ. For instance, the consumer market’s behavior is “influenced by four key sets of buyer characteristics: cultural, social, personal and psychological.” Also the Business markets involve the sale of goods between businesses. These are goods that are not aimed directly at consumers. Industrial markets include
• Selling finished goods
– Examples include office furniture, computer systems
• Selling raw materials or components
– Examples include steel, coal, gas, timber
• Selling services to businesses
– Examples include waste disposal, security, accounting & legal services

Business market consists of profit making organizations. They can be industries, business and retailers. They buy products for business use, reselling or making other products. Buying is done by professional people. The product is backed by company's reputation, sales force and competitive price.

The characteristics of business market are:

I) Focus: The focus of the market is organizations. They are geographically concentrated. It is business to business marketing.

II) Profit: The customers buy products for business use, reselling or making other products. Their aim is to make profit.

III) Demand: The demand for products is generally inelastic. It is not much affected by price. Buyers buy in large volume.

IV) Professionalism: The buying is done by trained and skilled professionals. Quotations and tenders are used as buying instruments. Internet is extensively used.

V) Rationality: The buying is rational based on adequate information. There is no emotional buying.

VI) Channel: Buying is generally done directly from manufacturers or authorized dealers.

VII) Relationship: There is close relationship between the buyer and the seller. Relationship marketing is important.

Finally, Sales force is used for promotion. The image of the company provides credibility to product.