WHAT ARE MARKETS?
The word market has a number of meanings. It used to refer primarily to the
place where goods were bought and sold. It can also refer to a large geographic area.
In some cases the word refers to the relationship between the demand and supply of a
specific product.
A market is an aggregate of people who, as individuals or in organizations,
have needs for products and who have the ability, willingness and authority to
purchase such products.
In general use, the term market sometimes refers to the total population – or
mass market – that buys products. However, the definition used here is more specific;
it refers to individuals seeking products in a specific product category. For example,
students are part of the market for textbooks, as well as being markets for calculators,
pens and pencils, paper, food, music and other products. Obviously, there are many
different markets in any economy.
For a group of people to be a market, the members of the group must meet the
following four requirements:
1. They must need or want a particular product or service.
2. They must have the ability to purchase the product. Ability to purchase is
related to buying power, which consists of resources such as money, gods
and services that can be traded in an exchange situation.
3. They must be willing to use their buying power.
4. They must have the authority to buy the specific products.
Individuals can have the desire, the buying power and the willingness to
purchase certain products but may not be authorized to do so. For example, secondary
school students may want, have the money for and be willing to buy alcoholic
beverages; but a brewer does not consider them a market because until they are 18
years old, they are prohibited by law from buying alcohol. An aggregate of people
that lacks any one of the four requirements thus does not constitute a market.
Markets can be divided into two categories: consumer markets and
organizational or business-to-business markets. These categories are based on the
characteristics of the individuals and groups that make up a specific market and the
purposes for which they buy products.
A consumer market consists of purchases and/or individuals in their
households who personally consume or benefit from the purchased products and who
do not buy products primarily to make profit. Each of us belongs to numerous
consumer markets for such products as housing, food, clothing, vehicles, personal
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services, appliances, furniture and recreational equipment. Markets made up of
individuals with diverse product needs are called heterogeneous markets.
Organizational (or industrial) markets consist of individuals and groups
that purchase a specific kind of product for re-sale, for direct use in producing other
products, or for use in day-to-day operations.
Producer markets include those individuals and business organizations that
purchase products for the purpose of making a profit by using them either to produce
other products or in their own operations. Intermediaries who buy finished products
and re-sell them for the purpose of making a profit are classified as reseller markets.
Government markets consist of national and local governments, which spend much
money annually for goods and services to support their internal operations and
provide citizens with needed services. Organizations that seek to achieve charitable,
educational, community or other non-profit goals constitute institutional markets.
Vocabulary
1. aggregate – сукупність
2. individual – приватна особа
3. ability – здатність
4. willingness – готовність, бажання
5. authority – повноваження
6. in conjunction with – разом з
7. meet requirements – відповідати вимогам
8. buying power – купівельна спроможність
9. beverage – напій
10.brewer – пивовар
11.constitute – складати
12.consumer market – споживчий ринок
13.organizational market – ринок товарів промислового призначення
14.appliance – прилад
15.recreational equipment – обладнання ля відпочинку, розваг
16.diverse – різний, різноманітний
17.heterogeneous market – різноманітний ринок
18.re-sale – перепродаж
19.producer market – ринок виробника
20.reseller market – ринок посередників
21.government market – державний ринок
22.annually – щорічно
23.charitable – благодійний
24.institutional market – ринок організацій
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Task 1. Read, translate and study the following words or phrases. Use them in
the sentences of your own.
-
demand and supply
different markets
buying power
specific products
diverse product needs
the authority to buy
exchange situation
act of selling
consumer market
refer
-
ability to purchase
organizational market
benefit
finished product
reseller market
government market
charitable goals
aggregate
meet requirements
Task 2. Replace the Ukrainian words and phrases by appropriate English equivalents.
1. Organizations that seek to achieve (благодійні), educational, community or
other non-profit goals constitute (ринки організацій).
2. The word “market” refers to the relationship between (попит і пропозиція) of
a specific product.
3. They must have the (повноваження) to buy the specific products.
4. (Вимоги) for markets are considered (у зв’язку з) these different types.
5. (Сукупність) of people that lacks any one of the requirements thus (не
створює) a market.
6. Consumers must be willing to use their (купівельну спроможність).
7. (Державні ринки) consist of national and local governments.
8. The four categories of (ринків товарів промислового призначення) – (ринки
виробника, ринки посередників, державні ринки та ринки організацій) –
were described by the lecturer last week.
Task 3. Generate other forms of the following words. Use these forms in your
own sentences.
Noun
authority
Verb
Adjective
prohibitive
consider
reference
aggregate
beneficial
constitute
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Task 4. Translate the following sentences into English.
1. Ринок – це сукупність людей, які як приватні особи або як представники
організацій, мають потреби в товарах та можливість, бажання і
повноваження купувати такі товари.
2. У деяких випадках слово «ринок» відноситься до попиту та пропозиції
визначеної продукції.
3. Ринок споживчих товарів складається з покупців, які особисто
споживають або отримують користь від придбаної продукції і які не
купують товари лише заради отримання прибутку.
4. Ринки, які складаються з окремих осіб з потребами у різноманітній
продукції, називаються різноманітними ринками.
5. Посередницькі організації, які купують готову продукцію і перепродують
її з метою отримання прибутку, класифікуються як ринки посередників.
Task 5. Find proper definitions and study them.
Term
1. Government
markets
2. Consumer market
a)
b)
3. Institutional
markets
c)
4. Organizational
market
d)
5. Heterogeneous
markets
6. Reseller markets
e)
f)
Definition
Organizations that seek to achieve charitable,
educational, community or other non-profit goals.
Consists of individuals and groups that purchase a
specific kind of product for resale, for direct use in
producing other products, or for use in day-to-day
operations.
Consist of national and local governments, which
spend much money annually for goods and
services to support their internal operations and
provide citizens with needed services.
Consists of purchases and/or individuals in their
households who personally consume or benefit
from the purchased products and who do not buy
products primarily to make a profit.
Intermediaries who buy finished products and resell them for the purpose of making a profit.
Markets made up of individuals with diverse
product needs.
Task 6. Answer the questions.
1.
2.
3.
4.
What is a market?
What are the requirements for a market?
Identify and describe the two major types of market. Give examples of each.
Identify, describe and give examples of four types of organizational markets.
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