Market

A market is defined as the sum total of all the buyers and sellers in the area or region under consideration. The area may be the earth, or countries, regions, states, or cities. The value, cost and price of items traded are as per forces of supply and demand in a market. The market may be a physical entity, or may be virtual. It may be local or global, perfect and imperfect.

Market - Different Perspectives

• The Economist's Perspective
  

The term 'market' as used by economists has a different meaning from ordinary usage. It does not mean literally the physical place in which commodities are sold or purchased (as in 'village market'), nor does it mean the stages that a commodity passes through between the producer and the consumer (as in marketing channels). Rather it refers in an abstract way to the purchase and sale transactions of a commodity and the formation of its price. Used in this way, the term refers to the countless decisions made by producers of a commodity (the supply side of the market) and consumers of a commodity (the demand side of the market), which taken together determine the price level of the commodity ... the term is detached from any particular geographical coverage. The geographical scope of the term depends on the context in which it is being used. It may refer to the local situation in some part of the rural economy, for example the market for cassava in southern Tanzania, or it can refer to the country as a whole, the region, or the international economy. Thus the expression 'world market' refers to the process of price formation at an international level for traded agricultural commodities.

• The Business Perspective
  

Business people tend to use the term 'market' to describe the groups of individuals or organizations that make up the pool of actual and potential customers for their goods and services. These groups fall into one or more of the following categories: geographic, demographic or socioeconomic, psychographic, behavioural or sectoral.

• The New Institutional Economics' perspective
  

Markets are a type of 'institution' or mechanism that exists to facilitate exchange, co-ordination and allocation of resources, goods and services between buyers and sellers, between producers, intermediaries and consumers; competitive markets can provide 'efficient' co-ordination by reducing the cost and risk of carrying out transactions, can encourage business development and also help to achieve broader economic objectives. But markets are not always competitive or efficient. Markets as an institution can be imperfect.

Market Size Tx Zhou</ref> Market size is the number of individuals in a certain market segment who are potential buyers. Companies should determine market size before launching a new product or service. Understanding market size helps you distinguish between two categories: the addressable market, which is the total revenue opportunity for your product or service; and the available market, which is the portion of the addressable market for which you can realistically compete. By outlining the difference between these two, you can develop a product offering to tackle that consumer sweet spot.