Marketing Concept
Marketing concept is also known as Marketing orientation. Marketing concepts starts with the customer and the company strives to learn customer needs and wants, develops appropriate products or services to satisfy the customer. With the passage of time, more knowledge, and experience, customers increasingly seemed unwilling to be persuaded. More and more companies found that determining what customers wanted was a must before making a product, rather than producing products first and then persuading them to buy.
The key questions became:
- What do customers really want?
- Can we develop it while they still want?
- How can we keep our customers satisfied?
Fundamental Marketing Concept
The marketer must understand the target market’s needs, wants, and demands (difference).
- Needs
- Needs are the basic human requirements
- People need food, air, water, clothing, and shelter to survive
- People also have strong needs for recreation, education, and entertainment
- Essential for survival
- Marketing program accordingly 4P’s
- Wants
- These needs become wants when they are directed to specific objects that might satisfy the need
- Not important for the basic functioning of life
- Driven by personal preference
- More influenced by changing treads and preference
- For example, luxury goods, entertainment, travel, specific brand etc.
- Demand
- Demands are wants for specific product backed by an ability to pay
- Market demand – total quantity of a product or service that consumers are willing and able to purchase at a given price and time.
- Many people want a BMW or luxury apartment or iPhone only a few willing and able to buy one.
- Companies must measure not only how many people want their product but also many would actually be willing and able to buy it.
- Marketing program accordingly 4P’s
Definition of Marketing
Marketing is the process of communicating the value of a product or service to customers, for the purpose of selling the product or service. It is a critical business function for attracting customers. Marketing satisfies these needs and wants through exchange processes and building long term relationships.
It is the process of communicating the value of a product or service through positioning to customers. It can be looked at as an organizational function and a set of processes for creating, delivering and communicating value to customers, and managing customer relationships in ways that also benefit the organization and its shareholders.
Marketing is the science of choosing target markets through market analysis and market segmentation, as well as understanding consumer buying behavior and providing superior customer value.
Nature and role of marketing
Marketing is the management process responsible for identifying, anticipating and satisfying consumer requirements profitably. Some organizations are very close to their consumers - for example, a post office in a small town. For other organizations consumers may be thousands of miles away - for example, Cadbury Schweppes selling confectionery and soft drinks around the world. The principle that the 'Consumer is King and Queen' is just as relevant to the organisation.
- 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 organisation 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.
Functions of Marketing
- Buying - people have the opportunity to buy products that they want.
- Selling - producers function within a free market to sell products to consumers.
- Financing - banks and other financial institutions provide money for the production and marketing of products.
- Storage - products must be stored and protected until they are needed. This function is especially important for perishable products such as fruits and vegetables.
- Transportation - products must be physically relocated to the locations where consumers can buy them. This is a very important function. Transportation includes rail road, ship, airplane, truck, and telecommunications for non-tangible products such as market information.
- Processing - processing involves turning a raw product, like wheat; into something the consumer can use – for example, bread.
- Risk-Taking - insurance companies provide coverage to protect producers and marketers from loss due to fire, theft, or natural disasters.
- Market Information - information from around the world about market conditions, weather, price movements, and political changes, can affect the marketing process. Market information is provided by all forms of telecommunication, such as television, the internet, and phone.
- Grading and Standardizing - Many products are graded in order to conform to previously determined standards of quality. For example, when you purchase US No. 1 Potatoes, you know you are buying the best potatoes on the market.
FAQ’s
What is Marketing Management?
It is the analysis, planning, implementation and control of programmes designed to bring about desired exchanges with target audiences for the purpose of personal and of mutual gain. It relies heavily on the adoption and coordination of product, price, promotion and place for achieving responses.
