Chapter one

Preview of marketing and marketing management

 According to Cardiff and Still Marketing is a social process by which products are matched with
markets and through which the consumer is able to use or enjoy the product. It makes goods and
services more useful to the society by creating the place, time and possession utilities.
 According to William MPride and OC Ferrel Marketing is the process of creating, distributing,
promoting, and pricing goods, services and ideas to facilitate satisfying exchange relationships in a
dynamic environment”
 The process by which companies engage customers, build strong customer relationships, and create
customer value in order to capture value from customers in return.
 Many people think of marketing as only selling and advertising. We are bombarded every day
with TV commercials, catalogs, spiels from sales people, and online pitches. However, selling
and advertising are only the tip of the marketing iceberg.
 Today, marketing must be understood not in the old sense of making a sale—“telling and
selling”—but in the new sense of satisfying customer needs. If the marketer engages consumers
effectively, understands their needs, develops products that provide superior customer value, and
prices, distributes, and promotes them well, these products will sell easily. In fact, according to
management guru Peter Drucker, “The aim of marketing is to make selling unnecessary.”
Selling and advertising are only part of a larger marketing mix—a set of marketing tools that
work together to engage customers, satisfy customer needs, and build customer relationships.
 Broadly defined, marketing is a social and managerial process by which individuals and
organizations obtain what they need and want through creating and exchanging value with
others. In a narrower business context, marketing involves building profitable, value- laden
exchange relationships with customers.
 Hence, we define marketing as the process by which companies engage customers, build strong
customer relationships, and create customer value in order to capture value from customers in
return.
The Marketing concepts
The Production Concept:
The production concept holds that consumers will favor products that are available and highly affordable.
Therefore, management should focus on improving production and distribution efficiency. This concept is
one of the oldest orientations that guides sellers.
The production concept is still a useful philosophy in some situations. For example, both personal computer
maker Lenovo and home appliance maker Haier dominate the highly competitive, price-sensitive Chinese
market through low labor costs, high production efficiency, and mass distribution. However, although useful
in some situations, the production concept can lead to marketing myopia. Companies adopting this
orientation run a major risk of focusing too narrowly on their own operations and losing sight of the real
objective—satisfying customer needs and building customer relationships.
The Product Concept:
The product concept holds that consumers will favor products that offer the most in quality, performance,
and innovative features. Under this concept, marketing strategy focuses on making continuous product
improvements.
Product quality and improvement are important parts of most marketing strategies. However, focusing only
on the company’s products can also lead to marketing myopia. For example, some manufacturers believe
that if they can “build a better mousetrap, the world will beat a path to their doors.” But they are often
rudely shocked. Buyers may be looking for a better solution to a mouse problem but not necessarily for a
better mousetrap. The better solution might be a chemical spray, an exterminating service, a house cat, or
something else that suits their needs even better than a mousetrap. Furthermore, a better mousetrap will not
sell unless the manufacturer designs, packages, and prices it attractively; places it in convenient distribution
channels; brings it to the attention of people who need it; and convinces buyers that it is a better product.
The Selling Concept.
The idea that consumers will not buy enough of the firm’s products unless the firm undertakes a large-scale
selling and promotion effort.
Many companies follow the selling concept, which holds that consumers will not buy enough of the firm’s
products unless it undertakes a large-scale selling and promotion effort. The selling concept is typically
practiced with unsought goods—those that buyers do not normally think of buying, such as life insurance or
blood donations. These industries must be good at tracking down prospects and selling them on a product’s
benefits.
Such aggressive selling, however, carries high risks. It focuses on creating sales trans- actions rather than on
building long-term, profitable customer relationships. The aim often is to sell what the company makes
rather than to make what the market wants. It assumes that customers who are coaxed into buying the
product will like it.Or, if they don’t like it, they will possibly forget their disappointment and buy it again
later. These are usually poor assumptions.
The Marketing Concept.
A philosophy in which achieving organizational goals depends on knowing the needs and wants of target
markets and delivering the desired satisfactions better than competitors do.
The marketing concept holds that achieving organizational goals depends on knowing the needs and wants
of target markets and delivering the desired satisfactions better than competitors do. Under the marketing
concept, customer focus and value are the paths to sales and profits. Instead of a product-centered make-
and- sell philosophy, the marketing concept is a customer-centered sense-and-respond philosophy. The job
is not to find the right customers for your product but to find the right products for your customers.
The marketing concept starts with a well-defined market, focuses on customer needs, and integrates all the
marketing activities that affect customers. In turn, it yields profits by creating relationships with the right
customers based on customer value and satisfaction.
Implementing the marketing concept often means more than simply responding to customers’ stated desires
and obvious needs. Customer-driven companies research customers deeply to learn about their desires,
gather new product ideas, and test product improvements. Such customer-driven marketing usually works
well when a clear need exists and when customers know what they want.
In many cases, however, customers don’t know what they want or even what is possible. As Henry Ford
once remarked, “If I’d asked people what they wanted, they would have said faster horses.” For example,
even 20 years ago, how many consumers would have thought to ask for now-common place products such
as tablet computers, smartphones, digital cameras, 24-hour online buying, digital video and music
streaming, and GPS systems in their cars and phones? Such situations call for customer-driving marketing—
understanding customer needs even better than customers themselves do and creating products and services
that meet both existing and latent needs, now and in the future. As an executive at 3M put it, “Our goal is to
lead customers where they want to go before they know where they want to go.”
Marketing is a never ending task. Marketing concerns itself with a arranging all the resources in a way that
meets the needs of the customers.
Companies orientation to marketing
The following points will bring forth the nature of marketing.
1. Marketing is customer oriented: Marketing begins and ends with the customer. Marketing concerns
itself not only with the satisfaction of the customer but also objects to delight him/her. All the organizational
 activities must be targeted and focused towards the customer. Customers must be allowed to decree product
specifications and standards regarding quality. And for this, customer’s needs must be examined
continuously.
2. Marketing is the delivery of value: When a customer is satisfied from a particular product based on its
overall performance, then the satisfaction that he has received is known as customer value. Customers
consider the product’s value and price before making a decision and make a trade-off between cost and
benefit of the product.They will choose a product that gives them more value per rupee. According to De
Rose, “Value is the satisfaction of customer requirements at the lowest possible cost of acquisition,
ownership and use”. Thus, the organization must aim to deliver greater customer value than that of their
competitors.
3. Marketing is network of relationships: The focal point of all marketing activities is the customer. The
term relationships marketing came into light in1990’s. According to Philip Kotler, “Relationship Marketing
is the practice of building long-term satisfying relations with key parties like customers, suppliers and
distributors in order to retain their long term preference and business.” So the marketers should aim at
maintaining long term relationships by delivering high quality products, better services and fair prices than
their competitors.
4. Marketing is business: All activities start from marketing i.e. through knowing customer’s needs and wants and
ends on the customer i.e. providing after sales service and knowing customer dissonance.The entire business revolves
around marketing
5. Marketing is dynamic: The word dynamic means ever changing. The needs and wants of the customer are
changing constantly. Since the goal of marketing is to meet customer’s needs and wants by furnishing them with the
products they want to buy, therefore, marketing must also change constantly to meet those needs and wants.
The Marketing Process

Figure 1.1 presents a simple, five-step model of the marketing process for creating and capturing customer
value. In the first four steps, companies work to understand consumers, create customer value, and build strong
customer relationships. In the final step, companies reap the rewards of creating superior customer value. By
creating value for consumers, they in turn capture value from consumers in the form of sales, profits, and long-
term customer equity.

In this chapter and the next, we will examine the steps of this simple model of mar- keting. In this chapter, we
review each step but focus more on the customer relationship
 Understand the Design a customer Construct an Engage customers, Capture value from
marketplace and value– driven integrated marketing build profitable customers to create
customer needs and marketing strategy program that relationships, and profits and
wants delivers superior create customer customer equity
value delight

FIGURE | 1.1The Marketing Process: Creating and Capturing Customer Value

Understanding the Market place and Customer Needs

As a first step, marketers need to understand customer needs and wants and the marketplace in which they
operate. We examine five core customer and marketplace concepts:

(1) needs, wants, and demands; (2) market offerings (products, services, and experiences);

(3) value and satisfaction

; (4) exchanges and relationships; and (5) markets.

Customer Needs, Wants, and Demands

Needs
Needs - Needs are the basic requirements of a human being, like food, cloth, shelter etc. humans
cannot survive lace of those requirements. education and health care are the extend part of needs in
this modern world. according to marketing language, human needs are state of felt deprivation. It is
the basic underlying of marketing.
Different people have different needs some of them are as follows
physical needs- Food, cloth, house, safety etc.
personal needs- self expression, discuss feeling etc.
Social needs- love, affection etc.
Ego needs: status, recognition and self-esteem
Wants
The form human needs take as they are shaped by culture and individual personality. Wants –
 Wants are the satisfiers of needs. Specific products has the ability of satisfy specific wants.
Wants are a form of needs and which are greatly dependent on the human needs. Wants are
unlimited. Customers want high value and satisfaction for money.
 For example, you need to write, for this your choice will be the best pen. For write is your
needs but the best brand of pen is your wants.
Demands

Demands- Demands are wants for specific products. They are backed by willingness and ability to buying
power. Wants backed by money and willingness to spend the money become demand.

For example, You need BMW car and you have the buying power, is your demand.
Market Offerings –

Products, Services, and Experiences. Consumers' needs and wants are satisfied through market
offerings. Market offerings are some combination, mixture, or blend of physical products, services,
information, ideas, or experiences offered to a market to satisfy a need or a want.

product and service

is a tangible item that is put on the market for acquisition, attention, or consumption, while a service is an intangible
item, which arises from the output of one or more individuals. Although it seems like the main distinction between
the two concepts is founded on their tangibility, that is not always the case. In most cases services are intangible, but
products are not always tangible.

Experience

The Customer Experience originates from a set of interactions between a customer and a product, a company, or
part of its organization, which provoke a reaction. This experience is strictly personal and implies the customer’s
involvement at different levels (rational, emotional, sensorial, physical and spiritual.

value and satisfaction

value theory customers often make some judgment about a product, its benefits,and the likely outcomes
of using the product. Howardand Sheth (1969) define satisfaction as “the buyer’s cognitive state of being
adequately or inadequately rewarded for the sacrifice he has undergone.”

Exchanges and Relationships

 is the act of obtaining a desired object from someone by offering something in return. In the broadest sense,
the marketer tries to bring about a response to some market offering. The response may be more than simply
buying or trading products and services. A political candidate, for instance, wants votes; a church wants
membership and participation; an orchestra wants an audience; and a social action group wants idea
acceptance .Marketing consists of actions taken to create, maintain, and grow desirable exchange
relationships with target audiences involving a product, service, idea, or other object. Companies want to
build strong relationships by consistently delivering superior customer value.

Markets

The concepts of exchange and relationships lead to the concept of a market. A market is the set of actual
and potential buyers of a product or service. These buyers share a par-ticular need or want that can be
satisfied through exchange relationships.
Marketing means managing markets to bring about profitable customer relationships. However,
creating these relationships takes work. Sellers must search for and engage buy- ers, identify their
needs, design good market offerings, set prices for them, promote them, and store and deliver them.
Activities such as consumer research, product development, communication, distribution, pricing,
and service are core marketing activities. Although we normally think of marketing as being carried
out by sellers, buyers also carry out marketing. Consumers market when they search for products,
interact with companies to obtain information, and make their purchases. In fact, today’s digital tech
nologies, from online sites and smartphone apps to the explosion of social media, have empowered
consumers and made marketing a truly two-way affair. Thus, in addition to customer relationship
management, today’s marketers must also deal effectively with customer-managed relationships.
Marketers are no longer asking only “How can we influence our customers?” but also “How can our
customers influence us?” and even “How can our customers influence each other?”
IMPORTANCE OF MARKETING

Marketing has become a very significant aspect in business since a firm’s financial success largely depends on marketing.
Most facets of business depend on successful marketing. Therefore, no firm today can afford to ignore the significance of
marketing. And it is not surprising that companies now have CMOs, that is, Chief Marketing Officer along with CEOs
(Chief Executive Officer) and CFOs (Chief Financial Officer). Marketers have now come to appreciate the importance of
their prudent marketing efforts and have understood that the success of a product will depend on how well the product is
introduced and promoted into the market. The umbrella term ‘Marketing’ covers advertising, promotion, public relations,
and sales. A firm might be offering the best products or services in an industry but without marketing it would be
impossible for the firm to inform its potential customers about the product. If no one knows about a company’s product,
there will be no demand, company will make no sales and hence there will be no profits. This highlights the significance
of marketing i.e. to create awareness about the products and make loyal customers and retain them. Marketing enables the
customers to know what marketers are offering to them and at the same time it enables the marketers to convince their
customers to buy their offerings. Successful marketing strategies help in not only understanding the customer and his
needs but also in the following ways:

1. It promotes awareness among the public – Marketing enables the customers to become aware about the various
products that are available in the market. A firm’s product must be known to the potential buyers for it to succeed. If there
were no marketing or advertising, the customers would not know about the products. A company must capitalize on
marketing activities so as not to miss the opportunity of being discovered. Attempts should be made to reach as many
customers as possible and tell them what the company has to offer with the help of effective marketing strategies.

2. It helps in boosting sales- Once the prospects become aware about the company’s products or services it boosts up the
chances that customers will make a purchase. New customers also start to spread the word, informing their friends and
family about the company’s product and consequently company’s sales starts to increase rapidly. No matter what a
company is selling, it will generate sales once the people come to know about it through TV advertisements, commercials,
newspaper advertisements, etc. The more the people see and hear about a new product, the more inclined they will be to
buy it.

3. It builds company reputation – Marketing helps to build brand name recognition or product recall and hence enables the
customers to relate the brand name with the images, logos and captions that they see or hear in advertisements. When the
company is able to satisfy the expectation of its customers, its reputation stand on a concrete ground. And once a company
succeeds in establishing its name, its business will grow and expand and more and more customers will start purchasing
its products and services.

4. It helps in fostering healthy competition – Marketing promotes a climate of healthy competition in the marketplace. It
helps to position the company as being superior to its rivals so that the customers will prefer its products rather than
buying from other firms that sell similar products and services. Competition drives the firms to invest in research and
development in order to produce better quality and innovative products and services. Thus marketing also helps to foster
innovation. To sum up, an attempt should be made to develop integrated marketing in the firm to serve the customers
better.
Scope of Marketing

Create Awareness

Informing customers about the company’s products is a must for attracting them to buy products. Marketing is
the medium through which companies communicate with the public and explain the features or benefits of their
products. Marketing helps in creating wide publicity of goods and services in the market.

Studies Customer’s Wants

Marketing helps in understanding the needs or wants of customers which enables them to provide satisfactory
services. Business through their marketing programs interacts with customers and understands their behaviors.
Proper understanding of customers’ demands helps in designing the right product which satisfies their needs.

Scope of Marketing

Product Planning

A product refers to a bundle of benefits that offers satisfaction to the consumers. Product planning starts with
the generation of the idea and continues until the product is ready to be launched in the market. To create a
successful product the company must understand the needs of the consumer and the currently available
competition in the market.

Advertising

Advertising is the best tool for marketing.  It makes the consumers aware of the product that is going to hit the
market. Through marketing, big companies are able to condition our subconscious mind about the goodness of
the product. The advertisement also helps to increase the sale drastically and ultimately the profits. Advertising
can be done through various media sources such as newspapers, television, magazines, hoardings, the internet,
etc.

Pricing Policies

Determination of the pricing policies of the product is crucial because good pricing policies will definitely help
in attracting more consumers. generally, consumers are highly-priced elastic which means lower the price,
higher will be the demand and higher the price, lower will be the demand. Cost of manufacturing the product,
government policies, marketing, competitors price, etc. are the factors that influence the price of the product.
Distribution

The selection of the proper distribution channel is very necessary for the product to attract new consumers
towards it. Selecting a distribution channel means defining the route of the goods they will take while reaching
from the producer to the ultimate consumer. Wholesaling and retailing are the two most popular distribution
channels.

Selling

It refers to the process of selling what is manufactured by the company as a product in the market. selling refers
to the supply of goods and services directly or indirectly to the targeted consumers. Selling involves performing
and managing various activities simultaneously such as approaching to the new consumers, distributing the free
samples, making sales on a huge discount, and getting feedback.

Packaging

The packaging is essential for delivering the product safely and secure a good image in the consumer’s mind. It
also helps in the goodwill formulation. Packaging involves designing and producing the external covering for
the product which will keep the product safe and hygienic. packaging is inclusive of the product information
which adds to the appeal of the product which ultimately helps in the sales promotion.

After-Sales Services

The term marketing includes after-sale services to be provided by the business to its customers. Resolving
issues of the customer’s and problems in case of any product failure will help in developing better relations with
customers.

Collects The Feedback

It involves collecting the feedback or suggestions of customers once the product is sold. Through this,
satisfaction or dissatisfaction level of customers can be easily identified which helps in improving the service
quality using suggestions provided by them

5 Essential Marketing Concepts You Should Know

In marketing, businesses will design strategies that satisfy customers’ needs, increase sales, maximize profit and
beat their competition. That is a nice truth and statement, but many might ask, “what philosophy is the best for a
company in setting marketing strategies?”Well, in this article we will discuss 5 different concepts of marketing
that each have a specific function in a holistic marketing strategy. The concepts are:

1. The Production Concept

2. The Product Concept

3. The Selling Concept

4. The Marketing Concept

5. The Societal Marketing Concept

Now, you might be wondering what each of those entails and before you get the cart before the horse, let’s
break down each of these marketing concepts in detail. We might even find some strong examples and trends of
usage throughout history! Let’s dive in!

The Five Marketing Concepts Described

The five basic marketing concepts are a key part of putting together any new marketing campaign. Here’s what
you need to know.

The Production Concept

The production concept is the most operations-oriented than any of the other marketing concepts on this list. It
speaks to the human truth that we prefer products that are easily available and inexpensive.

This concept was founded during the production era of early Capitalism in the mid-1950s.  During that era,
businesses concerned themselves primarily with production, manufacturing, and efficiency issues. This is also
the time when the “Says Law” was created exciting the idea of supply and demand.The basic idea of this
concept is that businesses will want to produce widely cheap products in maximum volumes to maximize
profitability and scale. Businesses assume that consumers are primarily interested in product availability and
low prices while customer’s needs might not be fully addressed. Such an approach is probably most effective
when a business operates in very high growth markets or where the potential for economies of scale is
significant. The problem with this concept is that businesses run the danger of not creating quality products and
might have customer service problems with impersonal production. An example of this is the use of developing
country to output cheaper products in higher quantities. Another historical example is Ford automobiles that
manufactured a ton of cars through its assembly line but all came out the same without customizations or user
input.

The Product Concept

The product concept is not so much about the production and business output but focuses more on the customer.

Potential customers favor products that offer quality, performance, or innovative features. This marketing
concept believes in potential customers and how their brand loyalty is closely tied to options of products, the
quality of those products and the benefits they get from the product and the business they invest in.

This is seen most commonly with our obsession with Apple products and looking forward to their new gadgets
and features upon launch!

In this marketing concept, businesses will concentrate on making superior products and improving them over
time. The problem is many businesses do not balance the need for a product all while realizing what the
marketing needs. There is a fine line between focusing on the customer and still defining your role and
leadership in the industry.

The Selling Concept

The selling concept is the bread and butter of marketing efforts as it believes that people will not buy enough of
a business’s product so businesses need to persuade them to do so. Of course, in today’s marketing, we know
that selling is not the way to full mark ting success. We more so find this marketing concept popular in the days
of WWII where there was aggressive advertising to promote people to buy bonds and different products. This
concept puts a lot of power into the hands of a business who has a whole plan to effectively stimulate more
buying with its potential customers. A lot of the time we also see this action used when a business has to deal
with overcapacity and needing to sell what they make rather than what the market needs or wants.Businesses
that choose to use this marketing concept must be good at finding potential customers and emotionally sell them
on the benefits of their “not needed product.”

The Marketing Concept

The marketing concept is the concept of competition. It is a marketing concept that believes that the success of a
business depends on the marketing efforts that deliver a better value proposition than its competitors. This
concept focuses on the needs and wants of target marketing as well as delivering value better than its
competition. Through marketing, it’s your goal to be the preferred option compared to your competitors.
Competitive advantage is key! We find typically this in the 1950s era of companies trying to carve themselves
out in the industry. We also can look at modern-day competition between Pepsi and Coke who sell similar items
but their value propositions are completely different!

The Societal Marketing Concept

The societal marketing concept is the most progressive and modern-day applicable marketing mindset to have.
It is a marketing concept that believes in giving back to society by producing better products that help the world
be a better place.

Marketing Goals

Marketing goals are specific objectives described in a marketing plan. These goals can be tasks, quotas,
improvements in KPIs, or other performance-based benchmarks used to measure marketing success. When
explicitly set, measurable goals are key for marketers to be successful.

Some examples of marketing goals include:

1. Building brand awareness

2. Generating a high volume of qualified leads

3. Establishing thought leadership

4. Attributing marketing activities to revenue generation

5. Increasing brand engagement