The 18 types of markets and their characteristics

A summary of the different types of markets that exist, classified according to various criteria.

Markets are basically physical or virtual spaces in which goods and services are bought and sold. Not all of them are the same, and there are different variables that allow us to speak of different types of markets

Depending on the product being bought and sold, the type of buyer, whether or not there is competition and the geographical area in which the commercial activity is carried out, we can speak of all types of markets which we will discover below.

What are the different types of markets?

Before going more in depth about the types of markets we are going to explain briefly what they are. From a microeconomic point of view, the market is understood as the set of supply and demand for a good or service.. Within this concept, one of the following two perspectives can be played, one being that of supply, i.e. sellers, and the other that of demand, i.e. buyers or consumers.

From a business point of view, and bearing in mind that every company is interested in attracting the maximum number of buyers, the demand market, i.e. the buyers, will be of interest. Thus this concept can be redefined within this perspective as the set of potential buyers, both individuals and legal entities, of the goods and services produced by different companies.

Once we have understood what a market is, we will now look at the different types of markets. Markets can be can be classified according to four variableswhich are:

• Product
• Buyer
• Jurisdiction
• Geographic area covered

Depending on the type of product being offered or purchased, the buyer's profile, whether or not there is competition and how wide the geographic area is in which a company or group of companies distributes its goods and services, we have the following 18 different types of markets.

Types of market based on the product

Taking into account the type of product that is bought and sold, we can speak of the following types of markets we can speak of the following types of markets:

Consumer products or perishable goods market 1.1.

The consumer products market is the one in which products aimed at satisfying the needs of the consumer are marketed. products aimed at satisfying a need for immediate or short-term consumption are marketed.. The products that are bought and sold are used to cover a need that is resolved when the product is used. The product loses its usefulness or directly disappears once it is used.

An example of this is all the food in a market. They are all aimed at satisfying hunger, as is eating an apple or a banana, which, by the time we eat them, can no longer be used again.

1.2. The use or investment product market

In the market for products of use, also called investment goods or capital goods markets, what happens is that products are exchanged that will be used to cover a need but, unlike the previous market, this good will not disappear in the next market, this good will not disappear at the first use, although it must be said that the durability of the product can be very varied..

In itself, the durability is longer than that of consumer products, but it can be long, as in the case of computers, or very short, as in the case of a pencil. In this second case, the pencil will satisfy our need to write and draw a few times until it runs out and we have to buy a new one.

1.3. Industrial products market

The industrial products market includes all the products that are used as inputs or raw materials to produce other goods or services, i.e., it is the market in which the market for industrial products is concentrated.In other words, it is the market in which the materials that will be transformed into all kinds of objects are traded.

An example of an industrial product market is the steel trade, which can be used to build anything from huge airplanes to our everyday household appliances.

1.4. Service market

As its name suggests, the services market offers services in which the consumer cannot acquire ownership of a product. the consumer cannot acquire ownership of a good, but rather the provision of a service.. This market would include any human activity that is paid for with both personal and public funds, such as public education, the cell phone service we have contracted, receiving a massage....

1.5. Financial markets

The idea of financial markets is rather more complex than the other four types of markets based on the product they offer. This type of market is a physical or virtual space through which financial assets are exchanged between different economic agents.. It is through their transactions that the prices of such assets are defined.

2. Types of markets based on buyers

Next we will look at the types of markets on the basis of buyers.

2.1. Distributors' market

The distributor market includes all companies that buy products not to consume them but to resell them at a higher price than they were purchased, and thus make a profit and defray the cost of acquiring such products. and, in this way, make a profit and defray the cost of acquiring such products.

An example of a distributor market is any supermarket in which products are purchased from manufacturing companies and resold to end consumers at slightly higher prices so that the establishment can make a profit.

2.2. Industrial buyers' market

The industrial buyers' market is made up of all the companies that buy resources to carry out their production process.. In other words, they are those buyers who purchase materials to transform them into all kinds of products.

An example of an industrial buyers' market would be any shoe company that buys leather, other fabrics, cardboard and metal to manufacture this type of footwear and other accessories such as handbags or clothing.

2.3. Government or institutional buyers' market

The government buyers' market The government buyers' market comprises all the institutions of a government that purchase goods and services to provide public services to the public.. The citizens are, in an indirect way, the ones who actually buy these products and services by paying their taxes.

An example of this would be the public health sector which buys medical devices, pays medical staff, hires cleaning companies for public hospitals, initiates disease prevention programs....

2.4. Consumer market

The consumer market is made up of all buyers seeking to purchase goods and services sold in the marketplace to satisfy their needs.. Anyone who goes to buy a table at the furniture store, buys a loaf of bread at the bakery or goes to the gym to pay the user fee is someone who is part of this consumer market.

2.5. Labor market

The labor market, also called the labor market, is the market in which supply and demand converge. supply and demand for employment converge.. The labor supply is made up of the set of unemployed workers who are willing to exercise a profession, and the labor demand is made up of the set of companies or employers who want to hire workers.

3. Types of market based on competition

Based on the type of competition faced by producers and suppliers of goods and services, we speak of the following types of markets.

3.1. Perfect competition market

The perfect competition market is a theoretical situation in which there is an infinite number of competitors in which none of them has the power to set prices in the market. there are an infinite number of competitors in which none of them has pricing power within the market, making virtually all products of the same type equal in terms of quality and price.In practice, the market of perfect competition does not exist. In practice, the perfect competition market does not exist.

3.2. Imperfect competition market

The imperfect competition market is the situation between perfect competition and pure monopoly.. There are times when the prices of products are similar, but at other times they change and one company ends up offering a product with a more advantageous price-quality ratio, which attracts more customers than the other companies offering the same product.

Pure monopoly market

The pure monopoly market is the situation that arises when a single company offers goods and services that are sold in a market.. In other words, it occurs when a particular service or good can only be found in one company, which has total power and control over its price, being able to raise it through the roof and make the maximum profit with it by not having any competitor to take away its customers.

4. Types of market based on the geographic area covered

According to the geographical area covered by the market, we can speak of the following types.

4.1. Local market

The local market is the one that serves a small market area, such as a city, county or at most a province, being the smallest market area.The local market is the smallest market area that exists. Several examples of this would be the bakery attended by the residents of a street, the market attended by the people of the district of Horta or the shopping center attended by the inhabitants of a whole region such as Barnasud.

4.2. Regional market

When we speak of a regional market, we are referring to one that serves an administrative area within the Horta district. serves an administrative area within a state (province, autonomous community, federated state...) or an undetermined geographic region, such as the north or south of the country.such as the north or south of a country. It can also refer to supranational regions, such as the Central American region, Western Europe, the Far East...

4.3. National market

The national market is one that a sovereign country or whatever can be understood as a nation, extending over all cities, towns and cities of the country.The national market covers all the cities, provinces, counties, departments and other political-administrative entities that make up the state. An example of a national market is the company RENFE, which offers its railway services throughout Spain.

4.4. International market

An international market is one that is made up of a group of buyers who may be from different countries.. Generally these markets are served by multinational or transnational companies and some examples are Coca Cola, Burger King, Honda and Mondelēz International.

4.5. Global market

The global market refers to a market that extends to all the countries of the world.. At this level, the goods and services offered by a given company or set of companies are produced and marketed in any country in the world. The global market is the broadest and most extensive of the types of markets that exist.

Bibliographical references:

• Ridao-González, J. M. (2016) Economía de la Empresa. España. Algaida editores.