Marketing concept (unit 10)

The marketing concept can be defined as adopting a consumer orientation in order to achieve long-term success. All of the

organization's efforts are geared to satisfying consumer needs. The philosophy of the marketing concept emerged during the 1950s, as the marketing era succeeded in the production and the sales. The concept can be applied to both profit-oriented and nonprofit organizations. Marketing is the link between the organization and the consumer. It is the way in which consumer needs are determined and the means by which consumers are informed that the organization can meet those needs.

In addition to selling goods and services, marketing is also used to advocate ideas or viewpoints, and to educate people.

Marketing is a total system of business activities designed to plan, price, promote and distribute want-satisfying product and services to present the potential customers.

According to the marketing concept an organization should try to satisfy the needs of customers through a coordinated set of activities that at the same time allows the organization to achieve its goals. Marketing strategy involves creating and maintaining an appropriate marketing mix (product, distribution, promotion, price and people) and selecting and analyzing a target market (a group of people for whom a firm creates and maintains a marketing mix that specially fits the needs and preferences of that group). In other words, marketing is a strategic management process: the business of màrketirïg must be organized, directed, and controlled to be effective.

It has often been said that the key to successful marketing is having the right-product at the right price in the right plate with the right promotion. In the end, the person who decides the ‘rightness’ of these four elements is the customer.

The daily activities of people who work in marketing departments revolve around designing, developing, and enhancing products, setting the prices for those products, promoting the products' features and benefits to the target markets, and distribution the product to the markets. These activities, the core of any marketing system, constitute the four controllable factors that provide the most effective choice for the consumer. They are often referred to as 'the four Ps' of marketing: product!, price, place (distribution) and promotion.

Each of the 4 Ps focuses on the customer and each is related to the other because a decision about one usually affects the others. The most effective combination of the 4 Ps is the right marketing mix for each particular product or service.

Note: The 4 Ps of marketing are now the 7 Ps, because of the increasing importance of services and customer service. They are: product, price, promotion, place, people, process and physical evidence.

Product

A product is everything that is received in an exchange. A product includes its design, quality and reliability. Every product must possess a ‘unique selling proposition’ (USP) - features and benefits that make it unlike any other product in its market.

A product item is a specific version of a product. A product line is a group of closely related product items that are considered a unit because of marketing, technical or end use considerations. The total group of products that an organization makes available to customers is called a product mix.

Every product has a life-cycle, the stages of which are introduction, growth, maturity and decline.

Products can be classified on the basis of the buyers’ intentions. Consumer products are those purchased to satisfy personal and family needs. Industrial or business-to-business products are purchased for the use in a company’s operations or to make other products.

Consumer products can be subdivided into convenience, shopping, specialty and unsought products.

Convenience products are relatively inexpensive, frequently purchased and rapidly consumed items. The buyers spend little time planning the purchase or comparing available brands or sellers.

Items that are more carefully chosen are called shopping products. Appliances, furniture, computers are examples of shopping products.

Products that possess unique characteristics and require a buyer’s considerable effort to obtain are called specialty products. Buyers actually plan the purchase of a specialty product they know exactly what they want and will not accept the substitute.

If a consumer needs to solve a sudden problem, he would purchase what is called an unsought product. Life insurance is an example of unsought product that needs aggressive personal selling.

Industrial products can be classified into seven categories according to their characteristics and intended uses: raw materials, major equipment, accessory equipment, component part, process materials, consumer supplies, MRO (maintenance, repair and operating) items and industrial services.