Marketing Concept Flashcards
When did the production concept come about?
1850s
How did the production concept evolve?
Industrial revolution:
- technological inventions enabled market traders to set up factories
- grew rapidly
- demand to produce more and more
- needed more people to work in the factories
- people then had more money to spend on consumer goods
- new factories opened up
Where did the industrial revolution begin?
Manchester cotton goods production
Production concept demand
Companies didn’t have to think about the customer
Produce more
Reduced price for consumer
Prices go down demand goes up
As more people buy and produce more, prices go down
Production led:
Produce more
Bring prices down
More customers
How long did the production concept last?
Until late 1920s
Example of the production concept
Henry Ford didn’t give customers colour choice
What happened in 1929?
Wall Street crash caused by the Great Depression
Consequences of the Wall Street crash?
People started to think about what they were spending
More cautious with their money
Manufacturers also become more cautious
Prices went down below the cost of production
What was the outcome of the Great Depression?
Era of the selling concept
1930s
Who started the selling concept?
Tom Watson Snr
CEO of IBM
Why the selling concept?
Couldn’t rely on he customers to buy, you had to go out and sell things
How does the selling concept work best?
Not loyal to brands
Competition brings the price down
Who adopts the production concept today?
Still developing countries
Why do still developing countries use the production concept?
Don’t have the products and services of developed countries
As the get employment they can spend more on products and services
Who starts marketing revolution?
Elvis 1955 rebellious youth, wouldn’t take what was given
How can companies meet the wants and needs of the customer?
First have to understand the industry they’re in
Reevaluate and reinvent the offerings to customer as they understand what they want
E.g American railways didn’t realise they were in the transport industry and had car and planes as competitors
What is the marketing concept?
Achieving organisational goals depend on DETERMINING THE NEEDS ANS WANTS OF TARGET MARKETS and delivering the desires satisfactions MORE EFFECTIVELY AND EFFICIENTLY than competitors do
How is the marketing concept achieved?
Management of the 4Ps
What are the 4Ps?
Product
Price
Place
Promotion
What are the three main components of the marketing concept?
Customer orientation
Goal achievement
Integrated effort
Do customers always know what they need or want?
No
Market led innovation
Customer orientation is
Corporate activities focused on providing customer satisfaction
Integrated effort is
All staff accept responsibility for creating customer satisfaction
What is goal achievement?
The belief that corporate goals can be achieved through customer satisfaction
Marketing concept Kohlberg 1980
Consists of determining the needs and wants of the target markets
Jobber 2004
The achievement of corporate goals through meeting and exceeding customer needs better than the competition
Marketing process role achieved by
Analysing marketing opportunities
Selecting target markets
Developing the marketing mix
Managing the marketing effort
McKitterick 1957
Awareness of consumer wants- market led organisations, integrations of actives around customer orientation, profit rather than sales as a measure of success
Keith 1960
The marketing revolution
The consumer is ‘at the absolute dead centre of the business universe’
‘Marketing is emerging as the most important single function in business’
McCarthy 1960
4Ps - four controllable variables that a company manages in its effort to satisfy the corporations objectives as well as the wants and needs of the target market
Borch 1958
Dual core concept of marketing
Not simply concerned with meeting explicit customer desires but also with creating them- managing demand and influencing the customer
Not only cater to customer demands but also ‘persuade the prospective customer, through all the arts if selling and advertising, to purchase the products and services that have been developed’
Kotler 1976 argued that
The marketing concept replaces and reverses the logic of the selling concept
Contrast Brown 2001 sales orientation still remains very much part of marketing identity whether we like it or not
Gardner and Levy 1955
Impact of brand image on consumer behaviour
- brand image is consisted of consumers opinion, attitude and emotion toward a brand, which reflects the cognitive or psychological elements of the brand
Levitt 1960
Marketing myopia
- an industry is a customer satisfying process, not a goods producing process
- businesses will do better if they concentrate on meeting customers needs rather than on selling products
Myopia- short sighted
- companies stop growing because of failure in management, not because the market is saturated but because of myopia
Production orientation
Production capabilities
Manufacture product
Aggressive sales effort
Customers
Marketing orientation
Customer needs
Potential market opportunities
Marketing products and services
Customers
Borch 1958
Dual core concept of marketing
Not just meeting desires of customers but creating them
