DEFININGTHEMARKET 29
- Theperson/organizationmustbewillingtobuytheproduct.
- Theperson/organizationmusthavetheauthoritytobuytheproduct.
- Thetotalnumberofpeople/organizationsmeeting thepreviouscriteriamustbe
largeenoughtobe profitableforthemarketer.
Allfivecriteriamustbemetforanaggregategroupofpeopleororganizationstoequate
toa market.Failuretoachieveevenoneofthecriteriamaynegatetheviabilityofa mar-
ket.Aninterestingexampleisthepharmaceutical industry.Thereareseveralserioushuman
diseasesthatremainuncuredonlybecausetheyhavenotbeencontractedbya largeenough
numberofpeopletowarrantthene cessaryresearch.Theexcessiveresearchcostsrequired
todevelopthesedrugsnecessitatesthatcompaniesareassureda certainlevelofprofitability.
Eventhoughthefirstfourcriteriamaybemet,a smallpotentialcustomerbasemeansno
viablemarketexists.
TheMarketIsa Place
Thinkingofthemarketasa place- "themarketplace"- is a commonpracticeofthegen-
eralpublic.Suchlocationsdoexistasgeographicalareaswithinwhichtradingoccurs.In
thiscontext,wecanthinkofworldmarkets,internationalmarkets,Americanmarkets,regions,
states,cities,andpartsofcities.Ashappingcenter,a block,a portionofa block,andeven
thesiteofa singleretailstorecanbecalleda market.
Whilenot aspervasiveasthe"people"componentofthemarket,the"place"descrip-
tionofa marketis importanttoo.Sincegoodsmustbedeliveredtoandcustomersattracted
towardparticularplaceswheretran~action~aremade, thisidentificationofmarketsis use-
fulformarketingdecision-makingpurposes.~-:;-ac~orssuchasproductfeatures,price,loca-
tionoffacilities,routing salespeople,andpromotionaldesignareallaffectedbythegeographic
market.Eveninthecaseofunmeasurablefields,suchasreligion,a marketplacemightbe
YankeeStadium,whereBillyGrahamisholdinga revival.Finally,a marketmaybesome-
whereotherthana geographical region,suchasa catalogueoradthatallowsyoutoplace
anorderwithouttheassistanceofa marketingintermediaryoran 800 number.
TheMarketIsanEconomicEntity
Inmostcases,a marketis characterizedbya dynamicsystemofeconomicforces.Thefour
mostsalienteconomicforcesaresupply,demand; competition,andgovernmentinterven-
tion.Thetermsbuyer'smarketandseller'smarketdesctibedifferentconditionsofbargaining
strength.Wealsousetermssucha~monopoly,oligopoly,andpurecompetitiontoreflect
thecompetitivesituationina particularmarket.Finally, theextentofpersonal freedomand
governmentcontrolproducesfreemarket systems, socialisticsystems,andothersystems
oftradeandcommerce.I
Again,placingtheselabels onmarketsallowsthe marketertodesignstrategiesthat
matcha particulareconomicsituation.Weknow,forinstance,thatina buyer's market,there
isanabundanceofproduct,pricesareusuallylow,andcustomersdictatethetermsofsale.
U.S. firmsfindthattheymustmaketremendousstrategyadjustmentswhentheyselltheir
productsin ThirdWorldmarkets.Theinteractionoftheseeconomicfactorsiswhatcreates
a market.
Thereisalwaysthepressureofcompetitionasnewfirmsenterandoldonesexit.Adver-
tisingandsellingpressure,priceandcounterprice,claimandcounterclaim,serviceandextra
serviceareallweaponsofcompetitivepressureLhatmarketersusetoachieveandprotect
marketpositions.Marketcompositionisconstantlychanging.