MGT5173 Marketing and Management : Marketplace and Balance of Power

Lecture 3 will highlight consumer differences, varying needs, wants, and motivations in addition to the stages of the decision making process. This may be used as a basis to argue why focusing on understanding the customer is the core to any marketing activity. This is an important lecture as it highlighted the basics of understanding customers, the decision making process, the differences between different groups of customers (segments) globally and so such points can be used to explain how such variations are extremely important and that without understanding the processes and stages that customers go through when making a decision, marketers run the risk of missing valuable information.

• The importance of market research in such situations

Lecture 4 will discuss concepts such as primary and secondary data, research problem and research planning. Based on this lecture, you should be able to focus on why is there a need for continuous market research to understand and satisfy consumer needs globally.

• Possible contextual examples

Lecture 5 will offer contextual luxury brand examples that may help you in arguing the case of how consumer tastes are merging and streamlining across the world and how it offers a possible standardization opportunity in a global world and thus bring another shift in the balance of power. 

Answer:

Introduction:

Digitalization has brought forth a lot of emerging issues in the manner at which products are traded in the market. The innovation of iPhones and smartphones have caused problems to the sellers whereas a sanctuary for the buyers. The introduction of the online market platform is the reason for this issue. For instance, the consumers' logs into different sites in which the product in which they desire is probably sold, source out the information and make orders. Therefore, leaving the retailers stranded since most of them sell their products at a slightly higher price than the online markets. Moreover, the online platform gives the buyers an opportunity to bargain before reaching consensus and delivering the product to their doorstep (Nuseir, 2016). Despite that the retail shops and the customers are both eligible for bargaining, the consumers are not easily convinced to the point of purchasing only because most of the retail traders cannot reduce the price to a discounted amount as desired by the buyers. Primarily, this causes the shift in power concerning the determiners of the prices of products to result from the consumers. In this piece of work, one will delve on the marketplace and balance of power, phenomena from a global perspective, reasons on focus on the consumer, the importance of market research and the contextual luxury examples so as to cover this assignment in an overt manner.

Marketplace and balance of power

Market refers to the interplay between the buyers and the consumers. It is the site through which different parties in trade meet with their potential clients. The customers purchase the products with a view of satisfying their human wants whereas the sellers engage in the transfer of the stocked goods to the consumers with the aim of making profits (Morrisey et al.,  2017). The two parties are very crucial since they complete the trading cycle. On the other hand, the balance of power is viewed as the parity or stability between the two forces in the bazaar. It was once celebrated; however, the traders started to exploit consumers. This problem resulted in the innovation of modern technology causing the shift of controlling the market to move to the consumer side. Most of the buyers use the information system to gather for the prices of different products through Google services and making a comparison with the one at the retail shops (Steenkamp, 2017). By doing so, they are exposed to various sites selling such a given product and thus leading to making orders in the cheapest market possible (Oliver, 2014). In a nutshell, one can depict that such kind of the situation is more of asymmetric in nature. The consumer is more detailed on a particular product than the seller in the market. The mechanism is caused by the fact the user is more interested in making their purchases to be cheaper as much as possible and thus does a lot of research concerning the quality, quantity and the price of that given product. On the contrary, the trader after being delivered with the products from the industries is taken by the notion of making prices without considering the consumers' impacts and thus leading to the current trend where the user dictates on their needs and desires in the market.

Global perspective on consumer dominating market

It has been established that the tyranny of making the prices concerning different products in the market is the decision of the consumers. They receive this ability through the external and the internal influences of the market environment. For instance, the internal factors such as the user needs, culture,  wants and values which propels most of them to ensure that the productivity is embraced upon in the way of they want. For instance, most of the consumers are led by the desire of products which can supplement their desires in a way in which they prefer regarding the price and quality. The desire prompts them to make decisions such using the internet to have them. More so, Molesworth, Grigore & Jenkins, (2014) outlines that, some purchasers are perplexed with the need to embrace their culture through their products. Therefore, they employ the use of changes in getting such products. Additionally, the consumer's values drive them into ensuring that what they need satisfy their private way of living. For instance, some value goods which come from ethically upright manufacturers. This causes them to do some Google search to reach them and thus making of orders (Schultz & Malthouse, 2017).

The external environment is also an important aspect when it comes to consumer shift in the manner in which the trade is controlled in the market. The external features entail those factors in which one cannot be able to monitor. They are majorly the political and technological aspects of the environment. The political reforms in the current century depict a system where the consumer has a say in their choice of products in the market Kotler et al., (2015). The reforms have led to the creation of the wealth among the middle-class people as a result of curbing of the exploitation of the buyers. Most of the states in the world have rules and regulation which governs the consumers from the buyers who attempts to exploit them in one way or another. The control has ensured the consumers are empowered through the government sponsored platforms such as television and the radio by disseminating information concerning the prices, quality and the availability of the particular goods in the market (Yadav & Pavlou, 2014). Consequently, this gives the buyers an opportunity to work out a budget as per the price component in the market. For that reason, most of them avoid being defrauded by unscrupulous buyers thus dominating the decision-making podium in the market (Schwab, 2017). Likewise, the availability of the new technology has also necessitated the manner at which the balance of power is obtained in the market. It has enabled different companies to reach a large number of buyers across the world. This process has been made possible through the availability of internet-enabled devices in which different consumers and the companies use (Cooper, 2016). The ability of the users to have the news regarding the goods from the manufacturers direct plays a primary role in bringing about a marketplace in which the traders and the buyers are at the equilibrium point. The consumer voice as a result of the information in which they have concerning the goods is vital since the retailers have to obey for them to make sales.

Customer focus and the balance of power shifting

Consumers have been seen to have differences in the way they view things in the marketplace since they always try to make a comparison between what is being sold and the information in which they have concerning the given product from the internet. The retailers should factor in their wants, needs, and motivation so as to understand them and thus make a strong sell (De Mooij, 2013). The retailers should apply the seven decision-making procedures in order for them to win the minds of the buyers. This steps include; identification of the problem, gathering information, analyzing the situation, developing options, evaluating the alternatives, selecting a preferred alternative and acting on the decision made so as to come to terms with consumers. By following these crucial steps, one will be able to understand customers and the manner in which the balance of power is shifting. Identification of the problems on why the consumers are demanding on the reduction in the prices in the market and their regularly purchasing online should be clearly outlined by the sellers if at all they still need to remain in business. Secondly, they should gather information concerning the needs and the wants of the consumers so as to be familiar and thus avail. Thirdly, Hollensen, (2015) highlights that, sellers should analyze the situation if at all they can quench the needs and desires of the customers or is it cumbersome in one way or another and so forth. The fourth step entails developing options through creative and active mechanisms so as to ensure that the consumers are well catered for and thus bringing about equilibrium in the market. The fifth step entails evaluating the different alternatives based on the choices of the buyers. One can assess the desirability, feasibility and the acceptability of the consumers. Kasemsap (2017) reiterates that, this modus operandi will enable the user to choose an alternative in which it can suit the customers and thus act as an easy route towards achieving one's objective. The sixth procedure is selecting of a preferred alternative which can withstand adverse changes in future in case the tyranny repeats itself. The final stage is acting on the decision made by putting a plan to implement the decision made and ensuring it is acceptable to the colleagues in the trading scenario. Such measures may lead to the creation of a balanced trade.

Importance of continuous market research

The trend in which the consumers are becoming the decision-makers in the business world is alarming. Therefore, ongoing research on the satisfaction of their needs should be in a progressive manner so as to bring about equity in the market. This problem can be curbed through organizational reforms of the business fraternity. These changes include creating of demand, providing support and product production mechanism. According to Andaleeb & Hasan, (2016), creating the application forms a basic research in that the retailers should introduce the products in which are most desired by the consumers at a moderate price.  Such products should rarely be sold on the market making the customers desperate. The matter will cause them to liaise with the traders so as to satisfy their needs. This method will enable the customers to act responsive and thus a market in which conscience is the order of the day is achieved. Furthermore, providing support to the consumers can help in ensuring that they reach a consensus in trading deals (Jain et al., 2017). The trading fraternity can do this by the offering of the legal and financial advice to the consumers at all levels. Finally, one should do extensive research on the product production section. The sellers should ensure that the products are quality, have the right quantity and readily available. Through the given aspiration, one is confident that the consumers will ultimately shift into the creation of an equilibrium business situation. Therefore, for equality in any endeavor the parties affected must be in an agreement on terms and conditions of association.

Contextual luxury examples on cases of shift in balance of power globally

One of the primary examples depicting the nature of the change in the balance of power in the world is the case of Pepsi Refresh project. According to this company, consumers are given an opportunity of making purchases online, and in return, one receives a charitable contribution by using social platforms such as Twitter and Facebook (Ailawadi & Farris, 2017). The consumers feel more honored and thus shifting their preference from other companies producing the same product hence their taste thus offering a divergent standardization opportunity where initiatives simply take people and making changes as soon as possible. Accordingly, it causes a nonstop shift in the balance of power in the market.  Another global example is the diminishing of the Apple as a result of the emergence of iPhones. The consumers were given an opportunity to make purchases online and thus leading to losses in the Apple Company since their distributors complained of failure to make sales as consumers were busy making an online request from Iphone Company.

Conclusion:

The shift experienced in the commercial world where consumers are the price makers will take decades to be revived. Companies manufacturing different products are not strict enough, and thus the consumers have the power to make purchases in them without considering the middlemen. For a balance of power to be realized, the users should be denied direct accessibility to the producers and stringent measures taken against their exploitation by distributors and wholesalers.

References:

Ailawadi, K. L., & Farris, P. W. (2017). Managing Multi-and Omni-Channel Distribution: Metrics and Research Directions. Journal of Retailing.

Andaleeb, S. S., & Hasan, K. (2016). Marketing Research. In Strategic Marketing Management in Asia: Case Studies and Lessons across Industries (pp. 111-160). Emerald Group Publishing Limited.

Cooper, M. (2016). Cable Market Power: The Never Ending Story of Consumer Overcharges and Excess Corporate Profits in Video and Broadband.

De Mooij, M. (2013). Global marketing and advertising: Understanding cultural paradoxes. Sage Publications.

Hollensen, S. (2015). Marketing management: A relationship approach. Pearson Education.

Jain, A., Sarma, A. D., Parameswaran, A., & Widom, J. (2017). Understanding Workers, Developing Effective Tasks, and Enhancing Marketplace Dynamics: A Study of a Large Crowdsourcing Marketplace. arXiv preprint arXiv:1701.06207.

Kasemsap, K. (2017). Mastering consumer attitude and sustainable consumption in the digital age. Handbook of research on leveraging consumer psychology for effective customer engagement, 16-41.

Kotler, P., Keller, K. L., Manceau, D., & Hémonnet-Goujot, A. (2015). Marketing management (Vol. 14). Englewood Cliffs, NJ: Prentice Hall.

Molesworth, M., Grigore, G., & Jenkins, R. (2014). Games people play with brands: An application of Transactional Analysis to marketplace relationships. Marketing Theory.

Morrisey, M. A., Rivlin, A. M., Nathan, R. P., & Hall, M. A. (2017). FIVE-STATE STUDY OF ACA MARKETPLACE COMPETITION.

Nuseir, M. T. (2016). Exploring the Use of Online Marketing Strategies and Digital Media to Improve the Brand Loyalty and Customer Retention. International Journal of Business and Management, 11(4), 228.

Oliver, R. L. (2014). Satisfaction: A behavioral perspective on the consumer. Routledge.

Schultz, D. E., & Malthouse, E. C. (2017). Interactivity, Marketing Communication, and Emerging Markets: A Way Forward. Journal of Current Issues & Research in Advertising, 38(1), 17-30.

Schwab, K. (2017). The fourth industrial revolution. Penguin UK.

Steenkamp, J. B. (2017). Global Brand Building in the Digital Age. In Global Brand Strategy (pp. 111-147). Palgrave Macmillan UK.

Yadav, M. S., & Pavlou, P. A. (2014). Marketing in computer-mediated environments: Research synthesis and new directions. Journal of Marketing, 78(1), 20-40.