The uncontrollable or environmental elements that the decision maker must adapt to, as shown in the outer hexagon of Figure 6, are not uncontrollable in an absolute sense. Logitech makes very high-quality computer products such as keyboard, mouse, and webcams. A company that believes in the marketing concept places the consumer at the center of the organization. Selling is preoccupied with the seller’s need to convert his product into cash; marketing with the idea of satisfying the needs of the customer utilizing the product and with the whole cluster of things associated with creating, delivering and finally consuming it.”. The concept of marketing is the rationality that urges association to concentrate on their clients necessities. In this context, marketing can be defined as "the management process that seeks to maximise returns to shareholders by developing relationships with valued customers and creating a competitive advantage". The followers of selling orientation have the belief that ‘it is a belief that consumers will not purchase or purchase enough of an organization’s product unless their interest is stimulated and they are persuaded to buy.’. This suggests that profit is to be made by satisfying customers’ needs. The selling orientation exclusively focuses attention on ways to push the product across with little or no regard for consumer interest. Its importance has increased substantially over the years because of the environmental factors like recession, intensity in inter- firm rivalry and the customer becoming more aware of … Decision making regarding pricing, selection of promotional mix, selection of distribution channel is taken by the marketing management. A company’s modification of the nature of its offering is achieved through product and service decisions which are essentially of two types. A business that is run on production oriented philosophy works with markets with the belief that product availability and affordability are key determinants of consumer buying. We have to identify and evaluate unsatisfied and potential customers’ needs and desires. Revenue is not found inside an organization rather it resides outside, in the customer’s pocket. Achieving organizational goals – Modern marketing states that an organization must aim at maximizing consumer satisfaction and in the process enable itself to achieve its goals such as growth, market share and reasonable amount of profit or return on investment. What do you think about the importance of Marketing Management in business? Regarding what business we are in, the company, for example, says, “we sell beauty and hope instead of we sell cosmetics.”. Satisfaction of consumers is the essence of the marketing concept. Focus on customer needs – The needs of the consumer are studied and these become the basis of all product related activities such as designing, pricing, distribution, packaging etc. This requires a systematic analysis, planning, implementation, and control of marketing efforts or programmes. Marketing management helps in creation of new customers and retention of current customers. It has the task of organising these elements into an effective operating system so that it can serve both customer and business enterprise effectively. New ways of motivation are being introduced so that the employee gives his best of services. In an organisation, marketing concept is used to examine the customer’s needs and make powerful decisions to satisfy those needs, increase the sales, make profits and stand among the opponents. Marketing management is a process involving analysis, planning, implementing and control and it covers goods, services, ideas and the goal is to produce satisfaction to the parties involved”. It takes an outside-inside view. This concept of marketing is a very important concept. These can be summarized, as in the outer hexagon of Figure 6, as competition, demand, non-marketing cost, structure of distribution, public policy, and company organization. This can erode future business opportunities. Marketing involves planning and development of goods and services. The Marketing Concept, which is not to be confused with the overall topic of Marketing Concepts, is the first approach which can actually fulfill the needs of a marketing strategy: building profitable long-term relationships by maximizing value for the customer. In an organisation, marketing concept is used to examine the customer’s needs and make powerful decisions to satisfy those needs, increase the sales, make profits and stand among the opponents. Societal marketing originated after it was realized that what is good for an individual customer or a select group may not be good for society. The company’s function is to influence consumers by using all possible sales techniques so that they are encouraged to buy more. It increases sales by holding contests, lotteries etc. For instance, there are specialized products that appeal to a limited number of customers like shoes for astronauts or watches for deep divers. As participating firms in a market went up so did the product availability. (4) Fixing and allocating the promotional budget to advertising and selling. The belief that a better product is always bought by consumers actually turned out to be wrong. The production concept was common to firms during the early period of industrialization when different products were born. Innovative methods must be used to understand the consumer, design an appropriate product and offer it to the consumer. In the marketing concept, companies start to focus on the customer need and what customer wants and how to satisfy their need. The marketing concept is put into practice by shifting the focus of value creation process to market or customers. Earlier when demand exceeded supply, there was no incentive for the firms to factor in consumers into their operation. The marketing-mix is expected to sell more than competitors. Other decisions concern dropping or adding an item to the product line. This definition suggests that marketing starts with the market, focuses attention on customers’ needs, and attains profit through customer satisfaction with coordinated marketing. It starts with the point of production, which focuses on products, and its aim is to earn profit through increased sales volume, and the means used are selling and promoting. In selling concept, the marketer assumes that customers will be coaxed into buying the product will like it; if they don’t like it, they will possibly forget their disappointment and buy it again later. What is the nature of each of the three elements making up the marketing management process – decision making, planning, and control? 14 Jan The five different marketing management concepts (orientations) Marketing,Marketing Concepts; Tags: Marketing Concept, marketing management, Product Concept, Production Concept, Selling Concept, Societal marketing concept no comments ; 1. A company can thus try to create a dominant position in the market where it operates. Initially, when the number of producers was relatively smaller, the concept was to produce and distribute a maximum of the product in an affordable way to the target market. Firms such as Hindustan Unilever Limited (HUL) and Procter & Gamble (P&G) operate in consumer markets whereas Schneider Electric and Larsen & Toubro (L&T) are business to business marketers. Marketers must answer 2 important questions. The term is named marketing mix… Controllable factors are the product, price, promotion and channels of distribution. Marketing process is on-going or dynamic and it must adapt itself to the ever-changing environmental needs. It is the process of organizing, directing and controlling the activities related to the marketing of goods and services to satisfy customers’ needs & achieve organizational goals. For instance, a distribution plan execution of a company like Pepsi will include undertaking activities such as handling of cartons at factory, loading on trucks, transportation, and delivery at sale points. This will help him in knowing the deficiencies if any, which can be corrected beforehand only and proper adjustments can be made with the changing environment. Product Concept. Marketing concept makes customer supreme and seeks to achieve organizational goals through customer satisfaction. From the above definitions, we can conclude that Marketing Management is the process of management of marketing programmes for accomplishing organizational goals and objectives. Marketing mix is done using the 4Ps of marketing – Product, Place, Price, Promotion and 7Ps in case of service- Physical Evidence, People, Process. In short word, marketing management works for translating the company vision, mission, and objectives, into effective Marketing initiatives. There are five alternative concepts under which organizations design and carry out their marketing strategies to answer these. However, if you see the rise and shine of FORD motor company, then you will know that ford actually established the moving assembly line back in 1913 and that is a perfect example of Production concept in action. To the marketer products are the building blocks of a marketing plan. Accordingly, proper marketing requires the following activities: Marketing begins with identification of the market in which a marketer wants to enter. This “law” of marketing management states- Since some things are controllable and others are not, sepa­rate the controllable from the uncontrollable and don’t waste your time and energy trying to change the uncontrollable. They started realizing that buyers will favor well-made products and are willing to pay more for product extras, and the product concept started taking place in the minds of many producers. The entire company works to develop, manufacture, and sell a product from the marketing perspective. Humans have various ideas as to how life should be conducted. Planning of marketing activities is a crucial task and involves numerous steps. Such an aggressive selling program carries very high risks. Marketing Management process involves the following: 1. Restaurants and startups do follow the marketing concept. While over the long term these factors will share the nature of the uncontrollable forces, the manager is forced by such aspects as convenience and lack of adequate data to concern himself mainly with the immedi­ate uncontrollable item. They also do not compare their products with that of competitors’ products to bring changes in their products. In this article, we talk about the Core Concepts of Marketing as put forward by Dr Philip Kotler. Production Concept. ii. Putting the marketing plan into action and. Right from production and design of the goods to its transportation, every process has the customer in mind. It is a very 21st-century concept that truly believes “the customer is king”. Or, if they don’t like it, they will possibly forget their disappointment and buy it again later.”. Getting, … Marketing is all about interacting with markets, notwithstanding whether it is for profit or for non-profit. Which of the following marketing management concepts is most likely to lead to marketing myopia? Typically the selling concept is practiced with unsought goods. They sometimes caught up with “LOVE AFFAIR” with the quality of their product and behaved unrealistically as people do when they are in love with someone of the opposite sex. Let’s overview the 5 basic marketing concepts with this infographic. It requires resource spending on different activities and programs designed to achieve mutually satisfying exchanges between marketers and customers. iv. Unsought goods are that buyers do not normally think of buying, such as insurance or blood donations. It is not uncommon to come across aggressive pushy salesmen in trades such as car dealerships, insurance, credit cards, real estate, fund raisers, and grocery stores. Before publishing your Articles on this site, please read the following pages: 1. 3. Ford in its early times practised production concept where the company sought to bring down car prices so that it could attract a large number of customers. The product should exactly satisfy the consumer. But it involves a series of activities like research analysis, production, development and innovation, advertisement and promotion pricing decision, selling and distribution, customer relationship and after sales service. The concept of marketing is a fundamental piece of the marketing arrangements. Various functions of marketing management are: 1. As Joseph C. Seibert says, “marketing management does not have the objective of creating customers insofar as it is responsible for creating or building markets. We can see Adidas doing great as they continue to support Colin Kaepernick despite pressure from various parties. The societal marketing concept holds “marketing strategy should deliver value to customers in a way that maintains or improves both the consumer’s and society’s well-being.”. Planning relates to product introduction, diversification. The concept of marketing has changed dramatically over the years. A market is a place or space that is made up of all present or potential buyers. The Selling Concept is suitable with unsought goods—those that buyers do not normally think of buying, such as insurance or blood donations. P. Drucker recognised the equal importance of innovative attitude and marketing concept. The marketing concept is the philosophy that firms should analyze the needs of their customers and then make decisions to satisfy those needs, better than the competition. a) Production concept: – The companies which use the production concept generally focus too narrowly on their own activities because according to this concept the companies think that consumer will buy the product which comes in the market. The setting of marketing goals and objectives, 4. This is especially true for things that are perceived to be inessential. 8. Since then however a combination of the effect of competition and the bargaining power of buyers have the forced the marketers to put the market’s needs first and their own second. Producing quality products does not necessarily guarantee its sale. It presents the product details to consumers through media. Marketing is related to markets and therefore marketing management calls for integration of the various elements of market. Marketing Management Orientations 5 Marketing Management Orientations Production Concept. Profitable sales over the long-run and repeat-purchase by customers are vital to success in marketing. The process of satisfying consumer needs and wants cannot be haphazard and instinctual. In the absence of choice, customers were forced into compliance or subordination by organizations. Accordingly, the first management task is to find an efficient distribution strategy that ensures product availability so that consumers can buy products with ease. With the passage of time the consumer and competitive conditions evolved. iii. This process of marketing management takes place “some­where” within the marketing system. The Societal Marketing Concept. Achieving high efficiency in production, low cost as well as distribution on a mass scale is the usual focus of the managers. This concept is also called customer orientation. Ford’s Model T was among the early cars that was manufactured on an assembly line, which reduced the car’s production cost by efficiencies in production processes. Marketing is a business function and set of processes involved in creating, delivering and communicating value to customers, followed by managing customer relationships, resulting in mutual benefit for the business and its stakeholders. v. Innovation – Innovation is an important tool to provide consumer satisfaction. The consumers are the king. This concept is more rational because it is not sufficient to manufacturer a product of good quality. Such segmentation helps the marketers to design specific strategies and techniques to promote a product amongst its target market. We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. Chapter 1 Marketing: Definition & Importance All activities involved in creation of time, place and possession utilities. This understanding can serve two objectives. “There will always, one can assume, be need for some selling. The constraint of repeat business changes the marketing paradigm in favour of the customer. Thus advertising and personal selling are alternative methods of performing the function of conveying information, but a particular blend of the two may be more effec­tive than either of them alone. Distribution process facilitates easy availability of goods and services to the customers at right time and at right and convenient location. “The Marketing concept is a customer orientation backed by integrated marketing aimed at generating customer satisfaction as the key to satisfying organizational goals”. Marketing, in its true sense, still does not get a strategic position in this concept. Instead they can best be viewed as controllable, but only at a cost. Organizations make a continuous endeavour towards planning, development and innovation of product and services so as to meet the changing demand, taste and preferences of the consumers. For effective marketing management, the firm must prefer an effective marketing concept. A similar concept is the value-based marketing which states the role of marketing to contribute to increasing shareholder value. Achievement is straightforwardly related to what the client needs. ‘Dollar shave club’ charges a couple of bucks a month with higher quality products and home delivery convenience. Reduction in production costs helps the firm to reduce, helping the market size to increase. The answer is no, unless they face the menace of mice. Marketing research involves identification of needs, wants taste and preferences of the targeted customer. One important point to be mentioned here is that a company’s operation is also influenced by the company’s overall target or objective. Disclaimer Copyright, Share Your Knowledge Production concept is probably the oldest business governing idea, which dates back to the period of short supply of goods. While pricing a product, managers consider factors such as costs, legal framework, prices charged by competitors and the prices that consumers are ready to pay. This is usually a very poor and costly assumption. Profit goals will only be achieved if customers willingly accept product or services. What is the marketing concept and relationship-building? It is for this indifference and reluctance that the sold products are pushed or offloaded on to buyers by putting in selling efforts. These high-quality products are priced higher, but people still buy, and they get almost free advertisement from independent reviews. This makes that task of understanding the consumer and designing an appropriate product much more difficult, however this is the only way a manufacturer can succeed in a competitive market. These differences are caused by per unit value that a product commands. Most times, the production concept can lead to marketing myopia. These industries must be good at tracking down prospects and selling them on a product’s benefits. It supplements advertisement and personal selling as a means of promoting sales. Production concept expresses that customers will favor products that are generally accessible and not very expensive. In 1960 the American marketing Association (AMA) proposed a definition of a brand stressing primarily its logo and visual aspects with the main purpose of identification and differentiation. Importance of Sales Management The application of this concept is also seen in service firms such as hospitals. Manufacturers were facing excess production capacity and competition for customers. Marketing Concept 3. It deals with physical attributes of the product and the benefits associated with use of that product. To be effective, selling must be preceded by several marketing activities such as needs assessment, marketing research, product development, pricing, and distribution. What Is Marketing Project Management? The non-controllable variables are social, technological, political, cultural and legal factors which affect the marketing strategies. If the marketer does a good job of identifying consumer needs, developing appropriate products, and pricing, distributing, and promoting them effectively, these products will sell very easily. This is basically a management orientation that holds that the key task of the firm is to determine the needs and wants of target markets and to adapt the organization to delivering the desired satisfactions more efficiently and effectively than its competitors in a way that preserves and enhances the well-being of the consumers in particular and the society in general. They have understood that people are not happy with their previous grooming products and their prices. Marketing activities are based on the premise of “make what the market wants”. Presence of demographic groups in the market creates differences in demand that may render one product differently attractive to these groups. The choice is generally based on a subtle or elaborate calculation as to which out of the available brands offers the best satisfaction. The number of buyers in a market gives rise to its size, which can either be expressed in terms of volume (e.g., number of cars sold in India in a given year) or value (e.g., total car sales expressed in rupee terms). The spatial aspects of the structure of distribution, for example, the geographical concentration of buyers in each market, will make a great difference in determining the best set of channels for a particular situation. This orientation is practised by sellers at the railway stations and places of tourist attraction. The Societal Marketing Concept puts human welfare on top before profits and satisfying the wants. Having seen the marketing system portrayed, you know that “somewhere” can be within any of the many, many companies—manufacturing, wholesaling and retailing—that make it up. The Marketing Concept – Concept of marketing February 13, 2018 By Hitesh Bhasin Tagged With: Marketing management articles The marketing concept proposes that the success of the firm depends on the marketing efforts of the company and in delivering a better value proposition as compared to its competitors in its own target market . This structure is culture- free and can be applied to any environment. The application of this law is an art in which analytic tools from science can aid. Plans should be flexible so as to adjust with the changing business environment. Marketing management performs the task of setting marketing objectives. Importance 5. Marketing concept was initially met with a lot of resistance by managers because it sought to create a power shift from managers to customers. Second, understanding of marketing management will permit a better grasp of the role of marketing in economic development, which many countries are so earnestly seeking. Welcome to! Theodore Levitt of Harvard drew a perceptive contrast between the selling and marketing concepts. A customer can be lured into buying by the power of persuasion or aggression only once but not repeatedly. It includes information on Internet marketing, marketing technology, international business and more. The company has appropriate marketing-mix for each target market. For example, suppose a company makes the best quality Floppy disk. Consumers determine the future of the market .Therefore providing the best product to the consumer according to their preference is the important task of marketing. The customers victimized by the power of seller aggression become dissatisfied and vent their anger by spreading negative word- of-mouth publicity. Marketing structure depends upon the size of the enterprise, geographical coverage of the operation, number of product lines, nature of product, size of customers. These decisions of product change and change in product line are common, since few companies in the United States produce a single product. Under such situations, consumers will basically be interested in owning the product, not the quality or features of it. Under the marketing concept, customer focus and value are the routes to achieve sales and profits. Co-Ordinating Different Activities of Enterprise: Even the best of planning will not be rewarding if there is improper coordination between different activities of the organisation. Once the market has been selected, the marketer has to plan how it will satisfy customers in the selected market. 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