MKT 420 Contemporary Issues in Marketing Chapter 2

MKT 420 Contemporary Issues in Marketing Chapter 2 Early Developments in Marketing

THE EARLY DEVELOPMENT OF MARKETING THOUGHT: A COMPLEX BEGINNING Shaw , 1995 in his study revealed that the earliest recorded English language use of the term “Marketing” as a noun was in 1561. ( Shaw, 1995 , p. 16). Shaw , 1995 found that an 1880 cookery book called ‘Miss Parloa’s New Cookbook and Marketing Guide ’ had discussed marketing, In this cookery book, Shaw tells us, the term ‘marketing ’ related to ‘buying and selling activities ’. Robert Bartels, 1988 told the term ‘marketing ’ was first used ‘as a noun ’, that is, as a label for a particular practice, sometime ‘between 1906 and 1911 ’.

The American Encyclopaedic Dictionary (1896) defines marketing as “the act or process of transacting business in markets ” as well as “goods offered for sale and purchased in a market. A century later, Webster’s Collegiate Dictionary (1994) continues to define marketing as “the act or process of selling or purchasing in a market ”

THE FIRST COURSES ON MARKETING IN THE EARLY TWENTIETH CENTURY We know that the earliest courses were delivered in 1902 at the Universities of Michigan, California and Illinois. These were Not called ‘marketing ’ per se, but labelled with a variety of other names such as ‘Distributive and Regulative Industries ’, ‘trade’ or ‘commerce’. First course in marketing offered at the University of Michigan by Dr. E. D. Jones in 1902. On a more theoretical level, there is some agreement in the historical literature that marketing developed as a form of ‘applied economics ’ (cf. Cassels, 1936 ; Jones and Monieson, 1990 ). Scholars say ‘applied economics’ because early and later marketing thought often contested the assumptions of classical and neoclassical economics.

STUDYING THE MARKETPLACE First scholars required material for their own teaching, they needed to study marketing related topics in real life. Marketing was studied products from their point of production and manufacture, all the way through to their distribution to the ultimate consumer. Weld, 1941 for instance, describes a number of his own research Projects where he ‘personally followed shipments of butter and eggs and Other commodities from the country shipper in Minnesota through the wholesalers, jobbers, and retailers to New York, Chicago, and other cities. He analyzed each item of expense involved in this passage Through the channels of trade ’

Jones and Monieson, 2008 had opined that marketing conceptualization involved the processes involved in moving a product from its point of origin – where it was harvested, for example – to the final consumer, was a result of scholarly and public concern over marketplace efficiency and what was called ‘the marketing problem. Research projects undertaken at the time (1910– 1920), asked questions about whethere were any elements in the supply chain that could be eliminated to save costs. In other words, were certain intermediaries (middlemen) actually adding any value to a product, such as getting it to the right place, at the right time, in a satisfactory condition, or did they simply only add further cost to the product.

The cost factor was notably important to people living in the late 1920 s And 1930 s US, as the Great Depression left many people unemployed, Lacking the financial wherewithal and ability to search for the highest quality, cheapest products; so any efficiency savings that could be made in terms of the distribution of products was considered a very important subject. Marketplace was no longer a sellers ’ market, business faced an important situation that it had not confronted on a large scale previously: demand was less than supply hence marketers needed to understand consumer behaviour for which marketing research evolved. Due to ever growing competition from 1950 marketers started focusing on Advertising and other promotions took over the market.

THE MARKETING CONCEPT Webster, 1988 claimed that until the mid-1950 s, the business world equated “marketing ” with “selling. ”Under this traditional view of marketing, the key to profitability was greater sales volume, and marketing’s responsibility was to sell what the factory could produce. High pressure selling was still used in some industries, and not all marketers were equally attentive to customer requirements. The same is true even nowadays. Borch, 1958 had tried to work on new concepts of customer orientation and customer satisfaction. Other concepts which also gained Importance were new product development, product line improvement, marketing research.

Webster, 1988 claimed that until the mid-1950 s, the business world equated “marketing ” with “selling. ”Under this traditional view of marketing, the key to profitability was greater sales volume, and marketing’s responsibility was to sell what the factory could produce. High pressure selling was still used in some industries, and not all marketers were equally attentive to customer requirements. The same is true even nowadays. Borch, 1958 had tried to work on new concepts of customer orientation and customer satisfaction. Other concepts which also gained Importance were new product development, product line improvement, marketing research.

DEMAND STIMULATION AND THE ‘DUAL CORE ’ MARKETING CONCEPT Borch , 1958 has said that “ companies produce products which are needed by the people or demanded by customers, rather companies also try to produce something which customers feel they in fact do not need them, but customers are educated that there is a need created by the marketers which realizes the customer to buy the product” this is termed as dual core marketing concept. The dual core concept resulted in marketing research rather market research which was being practiced till then, Zaltman and Burger , 1975 go so far as so identify a shift in the way ‘market research ’ was translated into ‘marketing research ’. This change appears to have been noted previously by Engel, who discussed the need to: ( cont : next slide)

“ Distinguish between marketing research and market research on the basis that the latter applies only to fact-finding, with perhaps some analysis of a single-market or marketing area, whereas the broader term includes not only the collection of facts about particular markets, but about marketing organizations, marketing methods and policies, the analysis of the facts, and the deduction of appropriate conclusions there. From “.

WORLD WAR II During World War II industry massively expanded on the back of the requirements of the Army, Navy and other military bodies since respective governments were biggest buyers what industry produced raging from food, medicine, automobiles, electronic equipment etc. After the end of World War II industry was left with huge capacities of production facilities in USA, Europe and Japan which were going under utilized. To cater to this situation where Tadajewski, 2006 said it was the fear that They losing site of consumers that really motivated firms to begin to hire the available marketing research agencies.

1950 s witnessed the increased use of psychological and psychoanalytical theory and techniques in marketing research. Consultants such as Ernest Dichter, who were well versed in such methods, claimed to be able to tap into consumer motivations beyond those available to questionnaire Studies, drawing out subconscious motives that were influential forces in Structuring consumer behaviour. This type of ‘motivation research ’ was interested in understanding why consumers bought specific products and tried to understand consumer buying motives and behaviour through a range of qualitative research approaches, including in-depth interviews and ethnography.

THE BEHAVIOURAL REVOLUTION IN MARKETING THEORY AND PRACTICE Kassarjian, 1989 says that the revolutionary marketing theory development using behavioural sciences as bases started with the initiatives of Ford and Carnegie foundations. Bartels, 1988 says these two foundations have pushed management educators were pushed to earn Ph. D degrees and to ‘upgrade’ their research skills, mainly in terms of improving their ability to manipulate complex mathematics. It was the funding provided by the Ford Foundation that ‘ served to usher in a new age for marketing. Tadajewski, 2006 this Foundations financially supported a whole range of textbooks, seminars and, training programmes that diffused their scientific vision for business research.

Kernan, 1995 a, 1995 b : Research had to be objective, scientific and rigorous, Academic journals soon reflected this emphasis, notably the newly founded Journal of Marketing Research. A published research paper in this journals had to contain some element of Mathematical symbolism or involve ‘laboratory research, experimental design, computer simulation, operations research, mathematical models, and high powered statistics. Hodock, 1991 : industry felt the behavioural revolution did not provide the much hoped for insights into market and consumer behaviour. Technical sophistication does not necessarily guarantee success. Too Many researchers are tied up with their numbers, statistics and rating scales – all of which have their place – but they lose sight of the reason for it all, which is insight into the consumer.

THE ‘IRRELEVANCE ’ OF MARKETING SCIENCE: MARKETING AND THE MILITARY –INDUSTRIAL COMPLEX Dawson, 1971 ; Wilkie and Moore, 2003, 2006 ; Shapiro, 2006 ) : critics rallied against the growing irrelevance of ‘marketing science ’, which was perceived to be ignoring the impact of marketing on society, focusing instead exclusively on issues related to managerial and firm competitiveness. Observers called for marketing intellectuals to devote attention to research issues that were central to contemporary policy debates; or to study the impact of marketing on society, and vice versa – that is, the study of macro-marketing. The movement away from a preoccupation with managerial, technical issues, was instigated by younger marketing academics rebelling against the alignment of marketing with the ‘military –industrial complex ’ (i. e. big business).

ENGAGING WITH SOCIETY Lib, 2007 : in view of the vociferous criticism that took place in the pages of the Journal of Public Policy and Marketing and elsewhere, marketing has been redefined in such a way that its impact on society is taken into account. The latest definition of marketing calls ‘marketing ’ ‘the activity, set of institutions for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. In line with this broadening of the scholarly and definitional focus Of marketing, many researchers have, since the mid to late 1980 s, engaged in research that studies ‘people’, not customers or consumers necessarily.