The Marketing Concepts

The Marketing Concepts

The marketing is the philosophy that firms should analyze the need of their customer4s and make decisions to satisfy those needs better than the competition.
To understand the marketing concepts it is worthwhile to put it in perspective by reviewing other philosophies that once were predominant.

• The Production Concept

This prevailed from the time of industrial revolution. The production concept was of idea that firm should focus on those that it could produce most efficiently and that the creation of supply of low cost would and of itself create the demand for the product. The key questions that a firm should ask itself before producing the product were

• Can we produce the product?
• Can we produce enough of it?

At times this production concept worked well because the goods that were produced were largely those of basic necessity and there was a relatively high level of unfulfilled demand. Virtually that a could be produced was sold easily by a sales team whose job was simply t o execute the transactions at a price demanded by the cost of production.

• The Sales Concept

In early 1930’s mass production became commonplace, competition had increased and there was an unfulfilled demand. Around this time firms began to practice the sales concept under which companies not only would produce the products, but also would try to convince the customers to buy them through advertising and personal selling .Before producing a product , the key questions were,

• Can we sell the product?
• Can we charge enough for it?

The sales concept paid little attention to whether the product actually was needed; the goal simply was to beat the competition to the sale with little regard to customer satisfaction. Marketing was the function that was performed after the product was developed and produced and many people came to associate marketing with hard selling. Even today many people use the word marketing when they really mean sales.

• The Marketing Concept

After the World War II the variety of products increased and hard selling no longer could be relied upon to generate sales. With increased discretionary income, customers could afford to be selective and buy only those products that precisely met their changing needs and these needs were not immediately obvious. The key questions became

• What does customer want?
• Can we develop while they still want it?
• How can we keep our customer happy?

In response to the se discerning customers, firms began to adopt the marketing concepts which involve

• Focusing on customer needs before developing a product.
• Aligning all functions of the company to focus on theses needs.
• Realizing a profit by successfully satisfying the customer needs over the long term.

When firm first began to adopt the marketing concept, they typically set up a seprate marketing department whose objective was to satisfy the customer’s needs. Often these departments were sales department5s with expanded responsible; ities. Since the entire organization exist to satisfy the customer needs, nobody can neglect the customer issue by declaring it a marketing problem – every body must be concerned with customer satisfaction.


The marketing concept relies upon the marketing research to define market segments, their size, and their needs. To satisfy those needs, the marketing teame makes a decision about the controllable parameters of marketing mix.



The role of marketing in business

Marketing collects and analyses data on markets and consumers / customers, and then uses this information to guide business decisions as to which products they should produce and the best methods to promote them.



Different Approaches to Marketing

In practice companies they differ greatly in their understanding of what marketing is, and this is evidenced in their approach to marketing. Here we will consider the four most commonly adopted approaches taken by businesses in conducting their marketing activities.

• Production Orientated
• Product Orientated
• Sales Orientated
• Market Orientated business

• The Production Orientated Business

Within the Production Orientated Business the assumption is that consumers will prefer products that are both readily available and affordable. Management in such businesses therefore focus on production efficiency and distribution. Henry Ford, with his Model T pioneered the mass production of a car which was both affordable and at that time far more available than his competitors. The problem with such an approach is that the customer wants more than just availability and affordability, compare Henry Fords famous quote ' a car of any colour as long as it's black' , with the range of Ford car colour combinations now available

• The Product Oriented Business

Within the Product Oriented Business the assumption is that consumers will prefer products / services which offer the most quality, performance, and range of features. Most famously one Ralph Waldo Emerson advise us, 'If a man ... makes a better mousetrap ... the world will beat a path to his door'. In short if your product is the best, then people will buy it. Management in such businesses therefore focus on Research and Development of product improvements.
Such companies believe that technical superiority is the key to business success, but this obsession with technological advancement can prove too blinkered. For example people need to be informed about your product, before they will be willing to pay what may well be a higher price for your better product.

• The Sales Oriented Business

Within the Sale Oriented business here the assumption is that consumers will not buy enough of the product unless they sell and promote the product, no matter how affordable, available and superior it is. The focus of management is therefore on making the sale, and not on whether the customer is satisfied afterwards. Here the customer is sold the product, whether it satisfies their real needs or not.
This can prove to be a poor assumption, as it has been claimed that dissatisfied customers don't buy again, and therefore repeat sales are lost. Whilst it has also been reported that whilst the average satisfied customer tells 3 people about their positive experience of a product, the average dissatisfied customer tells 10.

• The Market Oriented Business

Within the Market Oriented business there is a belief that its success depends on identifying and satisfying the needs of its customers now and in the future. Management start therefore by researching their market in order to define customer needs, and invest in developing products which will satisfy those needs effectively and efficiently.
Once this has been achieved, the whole process must begin again in order to finely tune their products to the changing needs of its existing and potential customers.
The truly market orientated business does not rest on past success. Many companies claim to adopt a marketing orientated approach, in that they have a Marketing Department, Marketing Plans, Research & Development, but that this in no way means they are completely customer focused.




Nature and role of marketing

All modern organizations engage in marketing so as to be able to please and win the loyal support of their customers. Gillette engages in marketing to find out about the needs and requirements of shavers, banks engage in marketing research to find out about its customers financial services requirements


'Marketing is the management process responsible for identifying, anticipating and satisfying consumer requirements profitably.'


Identifying - This will involve answering questions such as
'How do we find out what the consumer's requirements are?' and
'How do we keep in touch with their thoughts and feelings and perceptions about our good or service. This is a key purpose of market research.

Anticipating - Consumer requirements change all the time. For example, as people become richer they may seek a greater variety of goods and services. Anticipation involves looking at the future as well as at the present. What will be the Next Best Thing (NBT) that people will require tomorrow.

Satisfying - Consumers want their requirements to be met. They seek particular benefits. They want the right goods, at the right price, at the right time in the right place.
Profitability- Marketing also involves making a margin of profit. An organization that fails to make a profit will have nothing to plough back into the future. Without the resources to put into ongoing marketing activities, it will not be able to identify, anticipate or satisfy consumer requirements.