Types of Market

Author: Jim Riley  Last updated: Sunday 23 September, 2012

Before delving too deep into the study of marketing, it is worth pausing to consider the different types of market that exist.

Markets can be analysed via the product itself, or end-consumer, or both. The most common distinction is between consumer and industrial markets.

Consumer Markets

Consumer markets are the markets for products and services bought by individuals for their own or family use. Goods bought in consumer markets can be categorised in several ways:

• Fast-moving consumer goods (“FMCG's”)

– These are high volume, low unit value, fast repurchase – Examples include: Ready meals; Baked Beans; Newspapers

• Consumer durables

– These have low volume but high unit value. Consumer durables are often further divided into: –White goods (e.g. fridge-freezers; cookers; dishwashers; microwaves) – Brown goods (e.g. DVD players; games consoles; personal computers)

• Soft goods – Soft goods are similar to consumer durables, except that they wear out more quickly and therefore have a shorter replacement cycle – Examples include clothes, shoes

• Services (e.g. hairdressing, dentists, childcare)

Industrial Markets

Industrial markets involve the sale of goods between businesses. These are goods that are not aimed directly at consumers. Industrial markets include

• Selling finished goods – Examples include office furniture, computer systems

• Selling raw materials or components – Examples include steel, coal, gas, timber

• Selling services to businesses – Examples include waste disposal, security, accounting & legal services

Industrial markets often require a slightly different marketing strategy and mix. In particular, a business may have to focus on a relatively small number of potential buyers (e.g. the IT Director responsible for ordering computer equipment in a multinational group). Whereas consumer marketing tends to be aimed at the mass market (in some cases, many millions of potential customers), industrial marketing tends to be focused.