A human need is a state of deprivation of some basic satisfaction. People require food, clothing, shelter, safety, belonging, and esteem. These needs are not created by society or by marketers. They exist in the very texture of human biology and the human condition.

In China, sales of color televisions and refrigerators have soared. Sports shoes are also popular with Nikes and Reeboks going at prices several times the monthly salary of an average Chinese worker. Mobile phones are also fast becoming popular. A senior executive at AT&T China once said that China will be the largest single market in the world for telecommunications infrastructure equipment for at least the next 30 to 40 years. In the food market, Heinz has seen China sales of its infant food surge several times ahead of target. Though demand for such consumer products is rising, the Chinese are also aspiring for intangible luxuries like a car license, computer literacy, and eloquence in English.

Wants

Wants are desires for specific satisfiers of needs. An American needs food and wants a hamburger, French fries, and a coke. In another society these needs might be satisfied differently. A hungry person in Mauritius may want mangos, rice, and beans. Although people’s needs are few, their wants are many. Human wants are continually shaped and reshaped by social forces and institutions, including churches, schools, families, and business corporations.

Demands

Demands are wants for specific products that are backed by an ability and willingness to buy them. Wants become demands when supported by purchasing power. Many people want a Mercedes; only a few are able and willing to buy one. Companies must therefore measure not only how many people want their product but, more importantly, how many would actually be willing and able to buy it.

These distinctions shed light on the frequent criticism that “marketers create needs” or “marketers get people to buy things they don’t want.” Marketers do not create needs: needs preexist marketers. Marketers, along with other societal influence, influence wants.

Exchange

People can obtain products in one of four ways. The first way is self-production. In this case, there is no market and no marketing. The second way is coercion. Hungry people can wrest or steal from others. No benefit is offered to the others except that of not being harmed. The third way is begging. Hungry people can approach others and beg for food. They have nothing tangible to offer except gratitude. The fourth way is exchange. Hungry people can offer a resource in return for food. Such as money, a good, or a service. Marketing emerges when people decide to satisfy need and wants through exchange.

Exchange is the act of obtaining a desired product from someone by offering something in return. For exchange potential to exist, five conditions must be satisfied:

1. there are at least two parties

2. each party has something that might be of value to the other party.

3. each party is capable of communication and delivery.

4. each party is free to accept or reject the exchange offer

5. each party believes it is appropriate or desirable to deal with the other party.

Transaction

Exchange is a process but not an event. If a buyer and a seller are negotiating and are moving to an agreement, it can be said that they are engaged in exchange. If the two reach an agreement after negotiating, we can say a transaction takes place. Transaction is included in exchange. Trade means the value exchange between a buyer and a seller, in which money acts as its media. But in exchange, money is not always the necessary media, there can be barter exchange, which means trading of goods or services for other goods or services.. Trade includes several factors, at least there are two things of value, the agreed-upon conditions, a time and a place of agreement. Usually there is a legal system to support and enforce compliance on the part of the transactors. Without a law of contracts, people would be in some transactions with some distrust and everyone would lose.

Market

A market consists of all the potential customers sharing a particular need or want who might be willing and able to engage in exchange to satisfy that need or want. Traditionally, a “market” was the place where buyers and sellers gathered to exchange their goods, such as a village square. Economists use the term to refer to a collection of buyers and sellers who transact over a particular product or product class; hence the housing market, the grain market, and so on. Business people often use the term “markets” colloquially to cover various groupings of customers. They talk about need markets, product markets, demographic markets, and geographic market.