MODULE 1 MARKETING AN INTRODUCTION

1.1

NATURE OF MARKETING

Differing Orientations to business give rise to different

concepts of marketing:
1. The Exchange Concept: Exchange of a product between the
seller & the buyer.
2. The Production Concept: Marketing is a mere appendage to
production. In organizations that practice this concept,
production dominates the thinking process.
3. The Product Concept: Whereas the production concept seeks to
win markets & profits via high volume of production & low unit
cost, the product concept seeks to achieve the same result via
product excellence, improved products, new products & ideally
designed/engineered products.
4. The Sales Concept: The Company has to aggressively promote
& push its products; it cannot expect its products to get picked up
automatically by the consumers. Heavy advertising, hi-power
personal selling, large scale sales promotion, heavy price discounts
& strong publicity & PR are the normal tools used by the
organizations that rely on this concept.
5.

The Marketing Concept: This was born out of the awareness

that a business should start with the determination of consumer
wants & end with the satisfaction of those wants. The concept puts
the consumer at both the beginning & the end of the business
cycle. It stipulates that any business should be one of anticipating,
stimulating & meeting consumers requirements.

MODULE 1 MARKETING AN INTRODUCTION

1.2 MARKETING MYOPIA

The Marketing Myopia is to be credited to Prof.
Theodore Levitt, who has explained the disadvantages
of excessive preoccupation with the product or
production or selling, ignoring the customer in the
process.
Marketing Myopia means a colored or crooked
perception of marketing & shortsightedness about
business. Excessive attention to the product or the
production or selling aspects at the cost of the customer
& his actual needs creates this myopia.
Such a myopia leads to a wrong or inadequate
understanding of the market & hence failure in the
marketplace.
It even leads to a wrong or inadequate understanding of
the very nature of the business in which the
organization is engaged.

MODULE 1 MARKETING AN INTRODUCTION

1.3

SELLING

MARKETING & SELLING

MARKETING

Addresses the needs of the seller

Starts with the buyer & focuses

constantly on the needs of the buyer

Emphasis on a saleable surplus

Buyer is the center of activities

Quickly converts products into cash

Identifies marketing opportunities

Views business as a goods producing Converts customer needs into products

process
No value satisfaction

Views business as a customer satisfying

process

Sellers dominate marketing mix

Buyer determines marketing mix

Stays with the reducing of the costs

Production of a product depends on the

buyers needs

Sellers motives dominate marketing Emphasis on innovation in every sphere

communications
of the business
Cost determines the prices

Marketing communication is important

Emphasis is on somehow selling

Consumer determines the price; price

determines the cost

Different departments of the business Emphasis on integrated marketing

operate as separate compartments
Production is the central function of the Departments are inter-dependent
business
Views the customer as the last link in the Views the customer as the very purpose
business
of business

MODULE 1 MARKETING AN INTRODUCTION

1.4

SHIFT IN ORIENTATION

The marketing concept essentially represents a shift in

orientation:
From Production orientation
From Product orientation
From Supply orientation
From Sales orientation
From Internal orientation

To Marketing orientation
To Customer orientation
To Demand orientation
To Satisfaction orientation
To External orientation

It is obvious that the marketing concept represents a

radically distinct approach to business. It is the most
advanced of all ideas on marketing that have emerged
through the years.
Only the marketing concept is capable of keeping the
organization free from marketing myopia; al other
ideas guiding marketing viz., the exchange concept, the
production concept, the product concept & the sales
concept give rise to marketing myopia of one form or
the other.

MODULE 1 MARKETING AN INTRODUCTION

1.5

DISTINGUISHING FEATURES OF MARKETING CONCEPT

The marketing concept has 4 major distinguishing features:

1.
2.
3.
4.

Consumer Orientation
Integrated Management, with Marketing as the Fulcrum
Consumer Satisfaction
Realization of all Organizational Goals, including Profits

Consumer Orientation
An overwhelming emphasis on the consumer & his need is the first
distinguishing feature of the marketing concept. The concept enables
the firm to look at its business from the point of view of the consumer.
The purpose of any business is to create a customer. It is the customer
who determines what a business is. It is the customer & he alone, who,
through being willing to pay for a good or service, convert economic
resources into wealth, things into goods. What a business thinks it
produces is not of first importance especially not to the future of the
business & its success. What the customer thinks he is buying what he
considers value, is decisive; it determines what a business is, what it
produces & whether it will prosper PETER F DRUCKER.
When a firm adopts the marketing concept, the customer becomes the
focal point of the business. The concept enjoins on the firm to accept
the consumer as he is with all his inherent contradictions -- & treat
him as a pivot around which the entire business has to be built. In other
words, the concept aims at translating into practice the textbook idea of
consumer sovereignty.

MODULE 1 MARKETING AN INTRODUCTION

1.6

INTEGRATED MANAGEMENT WITH MARKETING FOCUS

Integrated management means that all the different functions

of the business must be tightly integrated with one another,
keeping marketing as the pivot. This is essential because every
function has a bearing on the consumer & the aim is to see that
all the functions make a favorable impact on the consumer.
For this to happen, all functions have to be integrated &
properly aligned with marketing. In organizations that do not
practice integrated management, the different departments are
preoccupied with the optimization of their specific activities,
often at the cost of optimization of the overall results.
For ex, the engineering department may design the product,
compromising standards, just to keep the cost of production
low; the production department may slacken quality control in
its excessive concern for sticking to quantitative targets.
In organizations that practice integrated management, the
management insists on absolute coordination of all company
actions, keeping marketing/customer as the focus; all elements
are seen through the eyes of the customer & are coordinated so
as to produce the best benefits & satisfaction for the customer;
and no department or executive functions in isolation.

MODULE 1 MARKETING AN INTRODUCTION

1.7 MARKETING CONCEPT & CUSTOMER VALUE

How do firms implement the marketing concept? Creating &
delivering better customer value is the only route by which
firms implement the marketing concept.
Customer satisfaction is the central theme of the marketing
concept & it is achieved only by delivery of customer value.
We can see in the real world of business that firms practicing
the marketing concept consistently maximize customer value in
their offers.
In fact, one can say that creation & delivery of customer value
is the essence of marketing.
The Marketing concept is essentially a point of view about
business. It enunciates that business is basically a needsatisfying process & that businesses must be managed keeping
the consumer & his need as the focus. The concept prescribes
that all goals of business, including profit, must be realized
through consumer orientation & generation of consumer
satisfaction.