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Marketing Concepts - Summary notes
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Marketing Concepts - Marketing concepts - Marketing and Social responsibility - Importance of Marketing - Relationship Marketing
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1. Marketing concepts (philosophies)Marketing philosophies guide the marketing efforts of organisation.
1.1 The marketing concept
The marketing concept holds that management achieves organisational
objectives by determining the needs of the target market and delivering
the desired product and satisfaction more effectively than competitors
do.
1.2 Company orientation: We distinguish four main orientations that
may guide the organisation in its marketing thought and efforts:
1.2.1 Production orientation: Believing that consumers favour products
that are available and affordable, management focuses on improving
production and distribution efficiency.
A production-orientated company concentrates on production of its
chosen products, and has a relatively small marketing and selling activity.
It usually depends on the excellence of its products, with a small amount
of advertising and public relations, to bring in the customers. Many small
businesses work in this way, and some individuals find it is possible to
earn a living by satisfying the needs of the local population. You might
think of the local shoe-mender, optician, lawyer or doctor as being in
such a category.
Rolls-Royce engine manufacturers were production-orientated until
their dramatic failure forced the British government to take steps to save
them from closure. The company had concentrated on designing and
making the best aero-engines in the world because they saw that
airliners were getting bigger and needed more power. To some extent
their marketing activity was successful, but they failed to look after the
profit part of the marketing definition, which is important. Even the best
, of designers are not so product-minded as to work for no pay and their
pay comes from profits, or at least from the surplus of income over costs.
1.2.2 Product orientation: Believing that consumers favour products
that offer the best quality, performance, and features, the organisation
focuses its efforts on improving products.
A product-orientated company believes that consumers will favour their
products that offer the highest quality, performance and features.
Therefore, the company devotes its energy to making continuous
product improvements. Some companies believe that they can build a
better car, but forget that unless they design the product to the
customers' needs, place it in convenient distribution channels, price it
effectively and tell the people who need it about the offering, the car will
probably not sell.
Believing that the market will favour the highest quality products can
also lead to marketing myopia, where we concentrate on the product
and not the need for the product. For example, in the past,
businesspeople thought travellers wanted trains (when in fact the need
was for transportation) and overlooked the growing need for airlines,
buses and trucks.
1.2.3 Selling orientation: Management believes that massive selling and
promotion efforts are required if consumers are to buy the product.
Selling-orientated companies are satisfied to make their profit by selling
what they or other people can make. To them, sales are the main
objective; they do not necessarily make any of the products that they
sell.
Mass production makes plenty of products available, so that there are
seldom any real shortages. However, the production lines can reduce the
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