Understanding Exchanges and Relationships in Markets

A tutorial for Understanding how Exchanges and Relationships create a Market for Consumers

Lesson Objective:  In this marketing tutorial, you will learn the following marketing concepts:

  1. Exchanges and relationships
  2. Understand what makes a market
  3. Marketing and a modern marketing system

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The last marketing 101 lesson, we gained an understanding of what customer needs and wants are and how they lead to marketers creating market offerings to meet customer’s needs and wants or demands.

Exchanges and Relationships

When consumers decided they want to satisfy their needs and wants they do so through what is known as exchange relationships. Exchange relationships or exchanges is the act of obtaining a desired object from someone by offering something in return.

Marketers try to bring about a response to some market offering. Responses by consumers may be buying or trading products or services or something more. As an example, a church may want new membership or a social action group may want the acceptance of their ideas.
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As a result, marketings’ goal is to create, maintain, and grow desirable exchange relationships with target audiences to sell or exchange, or gain acceptance of products, services, ideas, and other objects.

Markets

A market exists when there are actual and potential buyers of products and services. A market is based on the concept of exchange and relationships and consumers share a particular need or want that can be satisfied through the exchange relationship.

While a market refers to an exchange and relationship coexistence, the act of marketing means the management of these markets to bring about profitable customer relationships. Creating these relationships requires work. As an example, sellers must:

  1. search for buyers
  2. identify the buyers needs
  3. create market offerings that meets customer expectations
  4. set competitive pricing for the products or services
  5. promote them
  6. warehouse them, and
  7. deliver the product

Core marketing activities include:

  1. consumer research
  2. product development
  3. communication
  4. distribution
  5. pricing
  6. service

In closing, marketing is carried out by both sellers and buyers. In today’s digital marketing environment, it allows consumers (buyers) to market for products easily. Consumers search for products online. They interact with companies through the company website or social media sites and make purchases. In today’s market environment, marketing is truly a two-way affair.

SIDEBAR: Modern Marketing System

A modern marketing system consist of:

  • Suppliers
  • the Company or retail firm
  • Competitors
  • Marketing intermediaries
  • Consumers

A modern marketing system is dynamic where each member of the system is dependent on one another. The idea of marketing involves serving a market of final consumers in the face of competition. Value is added by each entity in the marketing system. A supplier or OEM can not move it’s products if its dealers or retailer do not provide exceptional customer service. Companies and competitors cannot supply low costs if their suppliers do not offer savings on products. Companies, their competitors and marketing intermediaries have a responsibility to supply consumers with value and positive relationships in exchange for consumer business, helping the company gain profits.

Modern Marketing System Diagram

Modern MArketing System Marketing Binder


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