1. The Marketing Concept/orientation
Discuss the Marketing Concept/orientation
Evaluate the benefits and costs of a marketing orientation for a selected organisation

2. http://www. youtube. com/watch. v=l4seWLW2KhQ marketing teacher
marketing teacher.com

3. Marketing Orientations
Organizations design and carry out their marketing strategies under five alternate orientation:
Production orientation
Product orientation
Selling orientation
Marketing orientation
Societal Marketing orientation
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4. The Production Concept
Consumers will favour products that are available and highly affordable
The organization should focus on improving production and distribution efficiency
Note to Instructors: An example of companies who follow the production concept are personal computer maker Lenovo and home appliance maker Haier, which 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.
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5. The Production Concept
This concept holds that customers will prefer products that are widely available and inexpensive

6. Problems with adopting production concept
In a competitive market any company that takes too narrow a focus whereby they concentrate only on reducing production costs run the risk of not meeting the requirements of consumers.
There are exceptions to the rule though,

7. Application of Production Concept
This orientation is applicable / fine where a company is faced with a situation where:
demand exceeds supply or
the product cost is too high and efficiencies have to be gained in production in order to gain customers or
buyers are more interested in obtaining the product than they are in specific features or
the buyer will buy what is available rather than wait for what they really want

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The Product Concept
Consumers will favor products that offer the most quality, performance, and features
The organization should devote its energy to making continuous product improvements
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9. The Product Concept
This concept holds that consumers favour those products that offer the most quality, performance, or innovative features

10. Problems with Product Concept
A product orientation can lead to an obsession with technology because the managers in the organization believe that technical superiority is the key to business success.
Continuous product improvements may not be what customers actually want – as is perhaps the case with one of the most recent innovations – the WAP (Wireless Application Protocol) phone.

11. product orientation often leads to marketing myopia (Leavitt 1960)
product orientation often leads to marketing myopia (Leavitt 1960).- the focus on the product rather than on the customer needs its presumes to satisfy.
Myopia may cause a company to ignore crucial changes in the market place because it causes marketers to look within the organisation rather than through the window

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The Selling Concept
Consumers will not buy enough of the firm’s products unless the firm undertakes a large-scale selling and promotion effort
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13. The Selling Concept
This concept holds that consumers and businesses, if left alone, will ordinarily not buy enough of the organisation’s products. The organisation must, therefore, undertake an aggressive and promotion effort

14. Problems with the selling concept
the problem with this approach is that it fails to consider customer satisfaction. When customers are introduced to buy products that they do not want or desire, they will not buy them again
Customers are likely to communicate any dissatisfaction with the product through negative word of mouth and may dissuade potential customers from similar purchases

15. With a focus on short-term results – creating transactional sales – rather than on building long-term, profitable relationships with customers, the type of company following this type of concept will often lose out when more customer focused competition enters the market

16. Application of the Selling Concept
The selling of ‘unsought’ goods represents an example of this type of company orientation. E.g. goods whose existence consumers are not aware of like insurance
It is also used by companies introducing new goods or with excessive inventory
Politicians used the selling concept too – political parties sell their candidates aggressively to capture voters

17. The Marketing Concept
This concept holds that the key to achieving organisational goals consist of the company being more effective than competitors in creating, delivering and communicating superior customer value to its chosen target markets.

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The Marketing Concept
Achieving organizational goals depends on knowing the needs and wants of target markets and delivering the desired satisfactions better than competitors do
Copyright 2013, Pearson Education

19. Figure 1.3 - The Selling and Marketing Concepts Contrasted
Note to Instructors: The selling concept takes an inside-out perspective. It starts with the factory, focuses on the company’s existing products, and calls for heavy selling and promotion to obtain profitable sales. It focuses primarily on customer conquest—getting short-term sales with little concern about who buys or why. In contrast, the marketing concept takes an outside-in perspective. 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.
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20. Selling vs Marketing Concepts
Selling Concept
Marketing Concept
Starting point
Factory
Market
Focus
Existing products and needs of sellers
Customer needs
Means
aggressive Selling and
promoting
Integrated marketing
Ends
(desired results)
Profits through sales volume
Profits through customer satisfaction

21. Sales Functions and Marketing Functions
It is important to realise at this stage that selling as an organisational concept is different to the sales function within a company.

22. ACTIVITY
What are the differences between the selling and the marketing functions in an organization?
How far do the two functions complement each other and how far do they stand alone?
Make notes to illustrate your answer

23. The Societal Marketing Concept
A company’s marketing decisions should consider consumer’s wants, the company’s desires, consumers’ long-run interests and society’s long-run interests
Note to Instructor
The text describes UPS as a good example of a company that follows the societal marketing concept. UPS proactively seeks opportunities to act responsibly. For example, UPS employees have volunteered millions of hours to United Way’s Live United campaign to improve the education, income, and health of the nation’s communities. UPS knows that doing what’s right benefits both consumers and the company.
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24. The Societal Marketing Concept
Calls for sustainable marketing—socially and environmentally responsible marketing that meets the present needs of consumers while also preserving the ability of future generations to meet their needs
According to UPS, social
responsibility “isn’t just good for the planet. It’s good for business.”
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25. The Societal Marketing Concept
This concept holds that the organisation’s task is to determine the needs, wants and interests of target markets and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves and enhances the customer’s and society’s well-being

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Figure The Considerations Underlying the Societal Marketing Concept
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27. Benefits of Marketing Orientation
Being marketing oriented enable the company to achieve a higher level of Branding. (e.g. Coca Cola had achieved this and they stand ahead of their competitors).
Another benefit is that the company is encouraged to innovate new products. (e.g. Coca cola is innovative and always developing new products).
Marketing oriented companies tends to be aware of the trend and the demand of the market. This leads to effective pricing and promotion strategies being adopted by companies

28. Cost of Marketing Orientation
A strong market orientation does come with significant costs.
Investment in marketing research is high because companies need powerful market intelligence to respond accurately.
Technological infrastructure is also critical in the early 21st century as companies use databases to collect, analyze and use customer data.
Constant modifications to work processes require investment in ongoing training. Constant product modifications also means ongoing investment in new equipment and product iterations.
Companies try to improve by changing its products/services (sometimes to match that of competitors) which customers might not always be happy with and might lead to decline in sales.

29. Transaction marketing differs from relationship marketing
Time perspective
Primary communication
Customer feedback mechanism
Market size
Criterion for success

30. The marketplace isn’t what it used to be…
Heightened competition
Globalization
Technologies
Industry convergence
Retail transformation
Disintermediation

31. Consumers are changing …
Consumer sophistication
Tech savvy
Self-expression
Buying power
Voice and influence
Co-creation
Self-service