Business enterprises conduct their marketing activity around these five concepts:
- The Production Concept
- The Product Concept
- The Selling Concept
- The Marketing Concept
- The Societal Marketing Concept
1. The Production Concept
- The production concept emerges out of the production orientation of the firm.
- It is based on the idea that the more we make, the more profitable we become. So let us go out and make customers buy our products.
- The basic proposition is that customers will choose products and services that are widely available and are of low cost.
- So managers try to achieve higher volume by lowering production costs and following intensive distribution strategy.
- Application of this concept however leads to poor quality of service and higher level of personalization in business.
- This seems to be a viable strategy in a developing market where market expansion is the survival strategy for the business.
2. The Product Concept
- The product concept has the proposition that consumers will favor those products that offer attributes like quality, performance and other innovative feature
- Managers focus on developing superior products and improving the existing product lines over a period of time.
- The problem with this orientation is that the managers forget to read the customer’s mind and launch products based on their own technological research and scientific innovations.
- Many times it is observed that innovations enter in the market before the market is ready for the product.
- Innovative products are launched without educating the customers about them and the probable benefit or value that the customer is likely to get by using the new products.
3. The Selling Concept
- The selling concept proposes that customers, be the individuals or organizations will not buy enough of the firm’s products unless they are persuaded to do so through the selling effort.
- So companies should undertake selling and promotion of their products for marketing success.
- This approach is applicable in the cases of unsought goods like life insurance, vacuum cleaner, fire fighting equipments including fire extinguisher, etc.
- These industries are seen having a strong network of sales force
- Firms with high capacity apply this orientation, in which their goal is to sell what they produce than what the customer really wants.
- The problem with this approach is the assumption that the customer will certainly buy the product after persuasion and if dissatisfied will not complain.
- In reality this does not happen and companies pursuing this concept often fail in business.
4. The Marketing Concept
- The marketing concept proposes that the reason for success lies in the company’s ability to create, deliver and communicate a better value proposition through its marketing offer, in comparison to the competitors for its chosen target segment.
- Selling focuses on the needs of the seller and marketing focuses on the needs of the buyer.
- Selling is preoccupied with the seller’s need to convert his product into cash whereas marketing deals with the idea of satisfying customer needs by offering a quality product and the whole cluster of things associated with creating, delivering and finally consuming it.
- The marketing concept is thus an elaborative attempt to explain the phenomenon that rests on four key issues like target market, customer need, integrated marketing communication and profitability.
5. The Societal Marketing Concept
- The societal marketing concept proposes that enterprise’s task is to determine the needs, wants and intentions of the target market and to deliver the expected satisfaction more effectively and efficiently than the competitors in a way to preserve or enhance the consumer’s and society’s well being.
- For eg.: the fruit juice companies like Tropicana, real, cloud 9, etc. takes into consideration the health of the consumers. They provide energy drinks which will help the consumers to quench their thirst as well as remain healthy whereas companies like coca-cola, Pepsi, etc provide soft drinks which are harmful for the health. So they lay focus only on the marketing aspect and not on the societal marketing aspects.
- The societal marketing concept is thus an extension of the marketing concept to cover society in addition to the consumers.