Marketing Concept Chapter 2 3 rd semester Introduction

Marketing Concept ( Chapter 2 ) ( 3 rd semester )

Introduction to Marketing Concept Marketing concept has two words: Marketing and Concept. A concept is a philosophy, an attitude, a course of thinking, an idea or a notion relating to any aspect of divine and human creations. Marketing concept is a way of thinking which determines the course of action about marketing functions. Thus. Marketing concept is the philosophy that guides the activities of marketing.

Historical development of marketing concept Marketing philosophy has undergone a thorough and gradual change since the great industrial revolution. The history of development of marketing concept can be divided into four stages: Development of Marketing Concept Ist Stage (from 1900 to 1930) IInd Stage (from 1930 to 1950) IIIrd Stage (from 1950 to 1990) IVth Stage (from 1990 to Update) Product-Oriented Sales-Oriented Customer-Oriented Social-Oriented

Different Concepts of Marketing Different views expressed by different authorities about marketing are studied as different concepts of marketing. Some important are given as follows: Ø Production Concept Ø Product Concept Ø Selling Concept Ø Distribution of Goods & Services Concept Ø Creation of Utility Concept Ø Delivery of Standard of living Concept Ø Societal Marketing Concept Ø Marketing Concept

Old Concept of Marketing According to old concept, marketing consists of merely buying and selling activities that effect the transfer of ownership of goods and services. Features of old concept of marketing Ø It consists of only production, buying and selling activities. Ø It aims at earning maximum profits. Ø It does not provide after sale services. Ø It does not give importance to consumer satisfaction. Ø It focuses attention only on production, ignoring consumer’s interests, tastes and preferences.

New Concept of Marketing The new concept of marketing says that all business activities are integrated. It realizes that the business is a marketing organization where all activities are directed towards the satisfaction of human wants. Target Market Customer Needs Integrated Marketing Profit through Customers satisfaction Features of New Concept of Marketing § It converts business firm in marketing organization. § It aims at earning profit only by satisfying consumers. § It creates and delivers standard of living to society. § It recognizes the consumer’s supremacy. § It stresses upon integrated marketing.

Fundamental Pillars of new marketing concept Marketing concept as a consumer-oriented marketing philosophy of the entire business organization has the following fundamental pillars or the main components of new marketing concept: New marketing concept Customer Orientation Integrated Marketing Customer Satisfaction Consumer Welfare

Significance of New Marketing Concept The adoption of new marketing concept is beneficial for business firm in the following ways: Ø Helpful in Product Development Ø More Social satisfaction Ø Positive Impact on profitability Ø Interaction with Customers Ø Overall Improvement Ø Useful in Competitive Market Ø Complete Evaluation Ø Growth of the firm Ø Makes firm more adaptive Ø Growth and development of the society

Difference between Old & New concepts of marketing Some points of differences between these two concepts can be based on follows: Ø Orientation Ø Scope Ø Target Ø Consumer Satisfaction Ø Integration Ø Market Research

Factors affecting adoption of new marketing concept In coming days, only consumer-oriented companies will survive. There are many factors which affect the adoption of modern marketing concept, some important factors are as follows: § Technical Progress § Change market conditions § Changed distribution channel § Developed means of communication § Organized consumers § Positive management supports

Limitations of marketing concept Robbin Peterson in his book, ‘Marketing”, points out that the marketing concept has a shortcoming that, “It focuses solely upon benefitting consumers and ignores others such as employees, suppliers, investors etc, . ” There are several limitations that come in the implementation of new marketing concept. Some are as follows: § Incomplete Consumer Research § Internal Dissensions § Organizational Constraints § Societal Constraints § Conflicting Objectives

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