Differentiating Bewteen Market Structures - 1624 Words

Differentiating Between Market Structures Mark Patterson ECO/365 Principles of Microeconomics April 21, 2013 Ashok Padhi Differentiating Between Market Structures There are different classifications of markets and the structure of a business determines which classification it will fall into. Markets are divided according to the composition of the business and what it provides to the specific market. Business composition is determined by the structure of market characteristics, and this helps determine level and area of competition. The characteristics in a market with the most concentration focus on number of purchasers and retailers, level in which a product has a substitute, price, entry and exit ease, and the level of mutual†¦show more content†¦Though these conditions are tough to achieve through the four traditional marketing P’s (product, price, place, and promotion), Trader Joe’s added a unique fifth P of culture to construct walls around its competitive space (Mallinger Rossy, 2007). Trader Joe’s is able to accomplish this because it provides value primarily by their adventurous shopping experience that is different from those of traditional markets: low price, casual, high service with constant and unpredictable mix in product. Its uniqueness makes it difficult for their competitors to copy, and their specific consumer target makes it almost impossible to replicate by companies serving a wider range of competitive space (Trader Joe s Company Competition, 2012). Monopolistically competitive markets are those that involve industries such as clothing, eateries, footwear, as well as in the service area. A monopolistically competitive market can be characterized as having an abundant amount of both manufacturers and consumers, consumer’s preferences for purchasing is known; survival in this area consists of the seller trying to distinguish specific products from competitors. A monopolistically competitive market could