INTRODUCTION TO MARKETING

What is MARKETING ?
INTRODUCTION TO MARKETING

MARKETING is a social and managerial process

by which

individuals and groups obtain what they need and want

through

creating, offering and exchanging products of value

with others.
INTRODUCTION TO MARKETING

Definition of MARKETING rests on the following core

factors :

1. Needs , wants and demands

2. Products, goods, services and ideas
3. Value, cost and satisfaction
4. Exchange and transaction
5. Relationships and network
6. Markets and prospects
INTRODUCTION TO MARKETING

Prime focus of MARKETING :

The entire system of business activities should be

customer oriented

The customers needs and wants must be

recognized and satisfied
INTRODUCTION TO MARKETING

Duration of MARKETING as an activity:

The activity starts with an idea about a want

satisfying product

The activity should not end until the customers

wants are completely satisfied

This may be sometime after an exchange is made

INTRODUCTION TO MARKETING
MARKETS

The concept of exchange leads to the concept of a

market

Market consists of all potential customers sharing a

particular need or want

And who might be willing and able to engage in

exchange to

Satisfy that need or want

INTRODUCTION TO MARKETING

WHO IS A MARKETER ?
INTRODUCTION TO MARKETING

MARKETER ?

Someone seeking one or more prospects who might

engage in an exchange of value

Who is a prospect ?
INTRODUCTION TO MARKETING

Prospect ?

Someone who the marketer identifies as potentially

willing and able to engage in an exchange of value

What is MARKETING MANAGEMENT ?

INTRODUCTION TO MARKETING
MARKETING MANAGEMENT ?
The process of planning and executing the
conception, pricing, promotion, and distribution

of
Ideas, goods and services

to

Create, exchanges that satisfy individual and

organizational goals
INTRODUCTION TO MARKETING

CONCEPT OF EXCHANGE
Exchange is a key concept in the definition of marketing
Exchange means people give up something to receive
something they would rather have
People normally think of money as the medium of
exchange
People give up money to get the goods and services
they want
Do all exchange require money?

What is that exchange that does not require money?

INTRODUCTION TO MARKETING
EXCHANGE that does not require money

BARTER
Two persons may barter or trade items
Olden days agriculturists bartered agricultural
products with
- utensils
- hand tools
- garments etc.
with those manufacturing them
This represented the stage of the barter system
INTRODUCTION TO MARKETING
EXCHANGE CAN TAKE PLACE ONLY IF THE FOLLOWING
FIVE CONDITIONS EXIST

1. There must be at least two parties

2. Each party has something that might be of value to the other
party
3. Each party is capable of communication and delivery
4. Each party is free to accept or reject the exchange offer
5. Each party believes it is appropriate or desirable to deal with the
other party

Exchange however will not necessarily take place even if all the
above conditions exist

They are however necessary for exchange to be possible

INTRODUCTION TO MARKETING
Marketing Management Philosophies
Six competing philosophies strongly influence an
organizations marketing activities.

These philosophies are commonly referred to as

1. Production Orientation
2. Product Orientation
3. Sales Orientation
4. Market Orientation
5. Societal Marketing Orientation
6. The Marketing Concept
INTRODUCTION TO MARKETING
Marketing Management Philosophies
PRODUCTION ORIENTATION

A philosophy that focuses only on the internal capabilities of the

firm

Does not focus on the needs of the market place or the

consumers

Production orientation means that management assesses its

resources and asks these questions :

1. What can we do best ?

2. What can our engineers design ?
3. What is easier to produce given the desired equipments ?
INTRODUCTION TO MARKETING
Marketing Management Philosophies
PRODUCTION ORIENTATION
In case of a service organization management asks the following
questions :
1. What services are most convenient for the firm to offer ?

2. Where do our talents lie ?

Experts have referred to this orientation as a field of dreams
orientation

E.g..: The furniture industry is infamous for its disregard of

customers and for its slow cycle times

This has always been a production oriented industry.

INTRODUCTION TO MARKETING
Marketing Management Philosophies

PRODUCT ORIENTATION
Focus was on the quality and quantity of output of product
Assumption : Customers would buy reasonably priced and well
made products
Managers with backgrounds in manufacturing and engineering
shape a firms strategy
In this philosophy demand of goods normally exceed supply
Finding customers is viewed as a relatively minor function
Emphasis is on internal operations and focused on efficiency and
cost control
Customers wants is highly predictable
Customer spending is on necessities
INTRODUCTION TO MARKETING
Marketing Management Philosophies

PRODUCT ORIENTATION

If a firm can make a good quality shoes inexpensively a market would

almost certainly exist

The term MARKETING is not in use

Need for existence of the sales department whose responsibility will be

to supervise sales

Sales department can simply carry out the transactions at a price

dictated by the cost of production

The emphasis is mostly on products and operations

INTRODUCTION TO MARKETING
Marketing Management Philosophies
SALES ORIENTATION
The world economic crisis of late 1920s (The Great Depression)
changed perception and gave rise to this philosophy

As developed countries emerged from depression facts became clear

Main economic problem was no longer how to manufacture efficiently

but rather how sell the resulting output

Just offering a quality product was no assurance of success

Realization that consumers had limited resources and numerous options

required substantial post production efforts

Thus SALES ORIENATION stage was characterized by heavy reliance on

promotional activity to sell products the firm waned to make
INTRODUCTION TO MARKETING
Marketing Management Philosophies
SALES ORIENTATION
Advertising consumes a larger share of the firms resources

Sales executives started getting a lot of respect from Company Management

Along with responsibility came the expectation of performance

Unfortunately these pressures resulted in managers resorting to overly

aggressive selling

Hard sell and unscrupulous advertising tactics

Result : Selling has developed an unsavory reputation in the eyes of many

Many firms believe in the hard sell approach to prosper

INTRODUCTION TO MARKETING
Marketing Management Philosophies
SALES ORIENTATION

Fundamental problem : Lack of understanding of the needs and wants of

the consumers

Companies often find that despite the quality of their sales force they
cannot convince people to buy goods or services that are neither wanted
nor needed

Some companies lack understanding of what is important to their

customers

Eg.: Many companies that came into existence once the economy
was opened in the 90s are no longer there as they focused more
on the technology rather than on the customers
INTRODUCTION TO MARKETING
Marketing Management Philosophies
MARKET ORIENTATION

Got prominence when strong pent up demand for consumer goods was
created by war time shortages at the end of World War II

Result : Manufacturing plants turned out tremendous quantities of goods

that the consumers required and were quickly purchased

Post war surge in consumer spending slowed down as supply caught up

with demand

Result :Many firms found out that they had excess production capacity

Sales were stimulated by aggressive promotional and sales activity of

the sales orientation era
INTRODUCTION TO MARKETING
Marketing Management Philosophies
MARKET ORIENTATION

However this time the sellers were less easily persuaded

War years changed the consumers because of exposure

War effort brought many women to the work force for the first time

Because of exposure consumers became more knowledgeable and less

nave and less easily influenced
INTRODUCTION TO MARKETING
MARKET ORIENTATION
Technology started developing during the 2nd World War

This made it possible to produce much greater variety of goods

when converted to peacetime activity

Thus the evolution of marketing continued

Companies started believing that they have to make idle

capacity to work

This could only be possible by making available what the

consumers wanted

In this stage companies identified what consumers needed and

wanted and then went on to satisfy those
INTRODUCTION TO MARKETING
MARKETING MYOPIA

Marketing myopia means a coloured or a crooked perception of

marketing
Short sightedness about business

When marketers give excessive attention to

1. products
2. production
3. and selling
and ignore the customer and his actual needs in the process, creates
this myopia.

It leads to a wrong or inadequate understanding of the market

and hence, failure in the market place.
INTRODUCTION TO MARKETING
Marketing Management Philosophies
SOCIETAL MARKETING ORIENTATION
A market-oriented organization may also choose not to
deliver the benefits sought by customers

Reason being that these benefits may not be good for the
individual or the society

This philosophy is called the societal marketing orientation

Philosophy : An organization exists not only to satisfy

customers needs and wants and the organizations
objectives but also to preserve or enhance individuals and
societys long term best interests
INTRODUCTION TO MARKETING
Marketing Management Philosophies
SOCIETAL MARKETING ORIENTATION

Many Companies marketing products in containers that are less toxic than normal,
more durable, contain reusable materials

Duracell and Eveready battery companies have reduced the levels of mercury in their
batteries and will eventually manufacture mercury free products

Turtle wax car wash products and detergents are biodegradable

Lubricants and Gear Oils are now biodegradable and are easily disposed

Factory waste management emphasizes that waste disposal should not affect the
atmosphere and the earths crust

Pollution control board has been set up to ensure that pollutants do not pollute the
environment
INTRODUCTION TO MARKETING
Marketing Management Philosophies
EMERGENCE OF THE MARKETING CONCEPT

The marketing concept came with the awareness that

1. Marketing starts with the determination of the consumer needs
and wants
2. Marketing ends with the satisfaction of these needs and wants

The concept stipulates that

1. Any business should be organized around the marketing function
2. Business should anticipate, stimulate and meet customers
requirement
3. The customer and not the corporation has to be the centre of the
business universe
INTRODUCTION TO MARKETING
Marketing Management Philosophies
THE MARKETING CONCEPT

The marketing concept represents essentially a change in orientation as

given below

From production orientation to marketing orientation

From product orientation to customer orientation
From supply orientation to demand orientation
From sales orientation to satisfaction orientation
From internal orientation to external orientation

It is thus obvious that the marketing concept

Represents a radically new approach to business
Is more advanced than any of the marketing concepts
INTRODUCTION TO MARKETING
Marketing Management Philosophies

DISTINGUISHING FEATURES OF THE MARKETING CONCEPT

Has four major distinguishing features

1. Consumer Orientation
The emphasis is on the consumers and his needs

2. Integrated Management action

Keeping marketing as a pivot all different functions of business has
to be integrated
Essential as every department function has a bearing on the
consumers
Aim is to see that every function leads to a favourable impact on the
consumer
INTRODUCTION TO MARKETING
Marketing Management Philosophies

DISTINGUISHING FEATURES OF THE MARKETING CONCEPT

3. Consumer satisfaction
Integrated management action is means and not an end in itself
The aim is to fulfill the needs of the consumers
The concept aims at satisfying the needs of the consumer

4. Realizing Organizational Goals Including Profits

Concept does not preach that a firm must only generate consumer
satisfaction
Aim is also to exercise control on costs ensuring quality, optimizing
productivity, maintaining a good organizational climate
thereby meeting the goals and profits of the organization
INTRODUCTION TO MARKETING
Marketing Management Philosophies

WHO BENEFITS FROM THE MARKETING

CONCEPT AND HOW ?

Marketing concept benefits the

1. Organization that practices it
2. The consumers at whom it is aimed
3. And the society at large
 MARKETING QUIZ

An Organization being Marketing Oriented

does not necessarily call for the Marketing
Department to successfully run the
Organization. Keeping Marketing as a pivot
all different functions of business has to be
integrated.

How would a Manager (Finance & Accounts)

be Market Oriented?