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Marketing Concepts

Production Concept
Period: Until 1950s

• A firm focusing on a production orientation specializes in


producing as much as possible of a given product or service.
Thus, this signifies a firm exploiting economies of scale until
the minimum efficient scale is reached. A production
orientation may be deployed when a high demand for a
product or service exists, coupled with a good certainty that
consumer tastes will not rapidly alter (similar to the sales
orientation).
Marketing concepts
Product Concept
Period: 1950-1960
A firm employing a product orientation is
chiefly concerned with the quality of its
own product. A firm would also assume
that as long as its product was of a high
standard, people would buy and consume
the product.
Marketing Concepts
Sales Concept
Period: Upto 1970s

A firm using a sales orientation focuses primarily on the


selling/promotion of a particular product, and not
determining new consumer desires as such.
Consequently, this entails simply selling an already
existing product, and using promotion techniques to
attain the highest sales possible.Such an orientation may
suit scenarios in which a firm holds dead stock, or
otherwise sells a product that is in high demand, with
little likelihood of changes in consumer tastes that would
diminish demand.
Marketing Concepts
Marketing Concept
Period: 1970s till date
The 'marketing orientation' is perhaps the most
common orientation used in contemporary marketing.
It involves a firm essentially basing its marketing
plans around the marketing concept, and thus
supplying products to suit new consumer tastes. As
an example, a firm would employ market research to
gauge consumer desires, use R&D to develop a
product attuned to the revealed information, and then
utilize promotion techniques to ensure persons know
the product exists.
Contemporary Marketing Concepts
• Relationship Marketing and Relationship
Management
Emphasis is placed on the whole
relationship between suppliers and
customers. The aim is to provide the best
possible customer service and build
customer loyalty.
Contemporary Marketing Concepts
• Business/ Industrial Marketing
• In this context, marketing takes place
between businesses or organizations. The
product focus lies on industrial
goods or capital goods rather than
consumer products or end products.
Different forms of marketing activities,
such as promotion, advertising and
communication to the customer are used.
Contemporary Marketing Concepts
• Social Marketing
Similar characteristics as marketing
orientation but with the added proviso
(Provision) that there will be a curtailment
(Limitation) of any harmful activities to
society, in either product, production, or
selling methods.
Contemporary Marketing Concepts
• Branding – Millennium Concept
In this context, "branding" is the main
company philosophy and marketing is
considered an instrument of branding
philosophy.
Emerging Concepts
• An emerging area of study and practice
concerns internal marketing, or how employees are
trained and managed to deliver the brand in a way that
positively impacts the acquisition and retention of
customers.
• Diffusion of innovations research explores how and why
people adopt new products, services, and ideas.
• With consumers' eroding attention span and willingness
to give time to advertising messages, marketers are
turning to forms of permission marketing such
as branded content, custom media and reality marketing.
Three key issues in Marketing
concept
1. Company should define its offering
based on its customer needs
2. All staff in the company should accept
the responsibility for customer
satisfaction
3. Company believes that by providing
customer satisfaction, it can achieve its
goals, e.g. profit and etc.
Green Marketing (from 1980s)
• According to the American Marketing
Association, green marketing is the
marketing of products that are presumed
to be environmentally safe. Thus green
marketing incorporates a broad range of
activities, including product modification,
changes to the production process,
packaging changes, as well as modifying
advertising.
Marketing Myopia
• Marketing myopia is a term coined
by Theodore Levitt. 
Simply Marketing myopia refers " focusing
products rather than customer ".
Gathering Information and
scanning Environment
What is a
Marketing Information System (MIS)?
A marketing information system
consists of people, equipment, and
procedures to gather, sort, analyze,
evaluate, and distribute needed, timely,
and accurate information to
marketing decision makers.
Table 3.1 Information Needs
Probes
• What decisions do you regularly make?
• What information do you need to make these
decisions?
• What information do you regularly get?
• What special studies do you periodically request?
• What information would you want that you are not
getting now?
• What are the four most helpful improvements that
could be made in the present marketing
information system?
Internal Records and
Marketing Intelligence

Sales
Order-to-Payment
Information
Cycle
System

Databases, Marketing
Warehousing, Intelligence
Data Mining System
Table 3.2
Secondary Commercial Data
Sources
Nielsen SAMI/Burke

MRCA Simmons

Information
Arbitron
Resources, Inc.
Needs and Trends

Fad

Trend

Megatrend
Trends Shaping the
Business Landscape
• Profound shifts in centers • Increase in demand for
of economic activity natural resources
• Increases in public-sector • Emergence of new global
activity industry structures
• Change in consumer • Ubiquitous access to
landscape information
• Technological • Management shifts from
connectivity art to science
• Scarcity of well-trained • Increase in scrutiny of big
talent business practices
Environmental Forces
Demographic

Political-Legal Economic

Technological Socio-Cultural

Natural
Population and Demographics
• Population growth • Educational groups
• Population age mix • Household patterns
• Ethnic markets • Geographical shifts
Household Patterns
Economic Environment
• Income Distribution
• Savings, Debt, and Credit

• Levi’s has responded to


changes in income
distribution by offering an
upscale line and a mass
market line
Natural Environment
Shortage of
raw materials

Increased
energy costs

Anti-pollution
pressures

Governmental
protections
Technological Environment
Pace of change

Opportunities
for innovation

Varying R&D
budgets

Increased regulation
of change
Political-Legal Environment

Increase in
business legislation

Growth of special
interest groups
Experience concept
• Pine and Gilmore argue that businesses must
orchestrate memorable events for their
customers, and that memory itself becomes the
product - the "experience". More advanced
experience businesses can begin charging for
the value of the "transformation" that an
experience offers.
• e.g. as education offerings might do if they were
able to participate in the value that is created by
the educated individual. This, they argue, is a
natural progression in the value added by the
business over and above its inputs
Stages of Marketing
Products/Services
• A commodity business charges for
undifferentiated products.
• A goods business charges for distinctive,
tangible things.
• A service business charges for the activities
you perform.
• An experience business charges for the feeling
customers get by engaging it.
• A transformation business charges for the
benefit customers (or "guests") receive by
spending time there.

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