The Converse Law - Theory and Practice (1)

The Converse Law - Theory and Practice (1) - The Converse...

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The Converse Law – Theory and Practice Beca Monica-Teodora, “Lucian Blaga” University, Faculty of Economic Sciences, Marketing, I st year, [email protected] Bucur Cristina Maria, “Lucian Blaga” University, Faculty of Economic Sciences, Finance, I st year, [email protected] Călin Ana-Maria, “Lucian Blaga” University, Faculty of Economic Sciences, Economy of tourism, trade and services, I st year, [email protected] Duma Cristina, “Lucian Blaga” University, Faculty of Economic Sciences, Marketing, I st year, [email protected] Abstract: Purpose- The purpose of this article is to determine wether The Converse Law applies considering a real example on the chain of Transagape supermarkets in Sibiu. The Converse Law is an important element in studying the market dimension and considering the current economic crisis it should be even more taken into consideration, so as to help the companies in the considered to fulfill their economic objectives. Design/methodology/approach- in a changing market, where the population is constantly decreasing there is a risc that the opening of a new comercial unit might not be beneficial for the already existing units and this the reason is why The Converse Law should be applied in the supermarket domain. By reasearch, the different aplicability on the zones with distinguishable density was divided into two clusters with different population ratio. Findings- In the reasearch carried there was discovered that the Converse variable has different values in real market situations compared with theory. Key-words : Converse Law, Gravitational Models, Commercial Area, Population, Marketing Research Theoretical background It can be observed that the economy, both national and international has a perpetuos development, depending more and more on shopping at an an-detail level. The reasons of this phenomenon are the growth of the population, the variety of products available on the market, and the increse of each customers expectations. This is why it is considered important a constant and focused attention on the market dimensions. In the pictured figure there can be observed the most important indicators of a market . . Figure 1 – Market dimensions First of all, let us talk about the market structure. Structuring a market is essential for any company, because it allows the specified company to divide its market into different segments of 1
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consumers, each with its own buying habits and rituals. For this structuring, one can use one or more criteria that a group of consumers have in common.(e.g.: age, sex, religion). The most common methods used in structuring a market are the Belson Method and the χ ²(chi square) test. We can express the market volume by means of several indicators, such as supply and demand volume,sales volume and market share. The market share can be total, relative and specific and reffers to the share that a product or company has out of the total market. The trade area can be defined as the geographic region from which a town draws most of its
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This note was uploaded on 10/26/2011 for the course MANAGEMENT MG2432 taught by Professor Muhammadadeel during the Spring '10 term at École Normale Supérieure.

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The Converse Law - Theory and Practice (1) - The Converse...

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