This article is about location of the market.
Successful Marketing requires firms to understand which market they are operating in, who their consumers are and where they are located, whether the market is growing or shrinking, what the business’s share of that market is and how strong the major competitors are.
What is meant by market location?
Market is a place where the company trades with its buyers. In this case, the market location will include the specific place where the transactions happen between the company and its buyers. This place will be represented by the shop address, the factory address or the website name for online merchants.
Additionally, market is also a group of people who are the target customers for the company’s products. In this case, the market location will include the specific place where those customers can be found – where they live or where they happen to be during the day. Customers for a firm can be both private individuals like you and me, other businesses as well as governments and other governmental institutions.
Different types of market location
Markets can be both local, regional, national and international. Different types of markets, as determined by market location, have different characteristics.
1. Local markets. Some small businesses such as sole traders and partnerships operate locally in one specific location. They sell products to consumers only in the area where the business is located. Local markets have very limited sales potential.
For example, local firms that usually just sell in these local markets include restaurants, florist shops, barber shops, shoemakers, bicycle-repair shops, laundromats, diners, etc.
2. Regional markets. Some larger businesses obviously cover a larger geographical area such as one province, the whole state, one prefecture or a selected part of the country. These businesses have had been successful locally and often expand into the whole region to serve more customers. Regional markets have higher sales potential than local markets.
For example, regional firms that sell in these regional markets include hotels and restaurants famous in a specific location of the country, hot spring resorts on one of the Japanese islands, Southern Company providing electricity and gas in the Southeastern part of the US, etc.
3. National markets. Some very large businesses sell in multiple locations across the whole country. These are large private limited companies and public limited companies which most likely extended from the regional markets to the national market. Businesses that have been successful regionally for a long time often do so. Only relatively few firms are able to expand to be able to sell to the national market. National markets have very high sales potential as the company is selling to all the people living in the country.
For example, regional firms that sell in these national markets include large banks such as Wells Fargo, insurance companies such as Safety Insurance Group, supermarket chains such as Home Depot, discount stores such as Walmart, large clothing retailers, etc.
4. International markets. Very large national businesses which had taken advantage of the process of globalization rose beyond selling only in one country. Businesses that have been very successful nationally often expand into other countries to increase sales dramatically. These are often well-established large public limited companies. The rise of multinational companies has been very fast in recent years. International markets offer the greatest sales potential to hundreds of millions, or even billions, of customers around the world.
For example, international firms that sell in these global markets include multinational fast food franchises such as McDonald’s, coffee shops such as Starbucks, The Coca-Cola Company, car manufacturers such as Toyota, producers and retailers of electronic devices such as Apple and Huawei, etc.
The Marketing content and tools covering all marketplaces both local markets, regional markets, national markets and international markets are relatively similar. Therefore, any of the marketing concepts mentioned on this website can be related to each market location.
