The concept or philosophy of
marketing has evolved over a period
of time, and is discussed as follows.
The Production Concept
During the earlier days of industrial
revolution, the demand for industrial goods started picking up but the
The number of producers was limited.
Selling was no problem.
Anybody who could produce the goods
was able to sell. As a result, the demand exceeded
the supply. The focus of business
activities was, therefore, on production.
Of goods. It was believed that profits
could be maximized by producing
at large scale, thereby reducing the
the average cost of production. It was
also assumed that consumers would
favor those products which were
widely available at an affordable price.
Thus, availability and affordability
of the product were considered to
Be the key to the success of a firm.
Therefore, greater emphasis was
placed on improving the production
and distribution efficiency of the firms.
The Product Concept
As a result of the emphasis on production
capacity during the earlier days, the
position of supply increased over
Period of time. Mere availability and low price of the product could not
ensure the increased sale and, as such the
survival and growth of the firm. Thus,
with the increase in the supply of the
products, customers started looking
for products which were superior in
quality, performance, and features.
Therefore, the emphasis of the firms
shifted from quantity of production
to quality of products. The focus of
business activity changed to bringing
continuous improvement in the quality,
incorporating new features, etc. Thus,
product improvement became the key
to profit maximization of a firm, under
the concept of product orientation.
The Selling Concept
With time, the marketing
environment underwent further
change. The increase in the scale of
business further improved the position
concerning the supply of goods,
resulting in increased competition
among sellers. The product quality
and availability did not ensure the
survival and growth of firms because
of the large number of sellers selling
quality products. This led to greater
importance to attracting and persuading
Customers to buy the product. The
business philosophy changed. It was
assumed that the customers would
not buy or not buy enough unless
they are adequately convinced and
motivated to do so. Therefore, firms
must undertake an aggressive selling
and promotional efforts to make
customers buy their products. The
use of promotional techniques such as advertising, personal selling, and sales
the promotion was considered essential
for selling of products. Thus, the focus
of business firms shifted to pushing
the sale of products through aggressive
selling techniques with a view to
persuade, lure or coax the buyers
to buy the products. Making sale
through any means became important.
It was assumed that buyers could be
manipulated but what was forgotten
was that in the long run what matters
most are the customer satisfaction,
rather than anything else.
The Marketing Concept
Marketing orientation implies that
focus on the satisfaction of customer’s
needs is the key to the success of
any organization in the market.
It assumes that in the long run
an organization can achieve its
The objective of maximizing profit is by
identifying the needs of its present
and prospective buyers and satisfying
them effectively. All the
decisions in a firm are taken from
the point of view of the customers. In
other words, customer satisfaction
becomes the focal point of all decision-making in the organization. For
For example, what product will be
produced, with what features and at
what price shall it be sold, or where
shall it be made available for sale will
depend on what do the customers
want. If the customers want features
like a double door in a refrigerator or a
separate provision for water cooler in
it, the organization would produce a
refrigerator with these features would
price it at a level which the customers
are willing to pay and so on. If all
marketing decisions are taken with
this perspective, selling will not be any
problem. It will automatically follow.
The basic role of a firm then is to
‘identify a need and fill it. The concept
implies that products ad-services are
bought not merely because of their
quality, packing or brand name,
but because they satisfy a specific
need of a customer. A pre-requisite
for the success of any organization,
therefore, it is to understand and
respond to customer needs.
To sum up, the marketing concept
is based on the following pillars:
(i) Identification of market or
customer who is chosen as the
the target of marketing effort.
(ii) Understanding needs and wants
of customers in the target market.
(iii) Development of products or
services for satisfying the needs of
the target market.
(iv) Satisfying needs of the target market
better than the competitors.
(v) Doing all this at a profit.
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