Principles Of Marketing

Assignment #1

Submitted by: Moiz Khan (BBA-2) Submitted to: Ms. Sadaf Sattar

MARKET MANAGEMENT PHILOSOPHIES

Production Concept
The production concept is a useful philosophy in two types of situations. The first occurs when the demand for a product exceeds the supply. Here, management should look for ways to increase production. The second situation occurs when the products cost is too high and improved productivity is needed to bring it gown. For example, Henry Fords whole philosophy was to perfect the production of the Model T so that its cost could be reduced and more people could afford it. He joked about offering people a car of any color as long as it was black. Today, Texas Instruments (TI) follows this philosophy of increased production and lower costs in order to bring down prices. It won a major share of the American hand-calculator market with this philosophy. But when TI used the same strategy in the digital watch market, it failed. Although they were priced low, customers did not find TIs watches very attractive. In its drive to bring down prices, TI lost sight of something else that its customers wanted namely, attractive, affordable digital watches. Another major concept guiding sellers, the product concept holds that consumers will favor products that offer the most quality, performance, and features, and that an organization should thus devote energy to making continuous product improvements. Some manufactures believe that if they can build a better mousetrap, the world will beat a path to their door. But they are often rudely shocked. Buyers may well be looking for a solution to a mouse problem, but not necessarily for a better mousetrap. The solution might be a chemical spray, an exterminating service, or something that works 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 them that it is a better product.

Product Example:
Coke Walkers Crisps

Product Concept
The product concept can also lead to marketing myopia. For instance, railroad management once thought that users wanted trains rather than transportation and overlooked the growing challenge of airlines, buses, trucks, and automobiles. Many colleges have assumed that high school graduates want a liberal arts education and have thus overlooked the increasing challange of vocational schools. Many organizations follow the selling concept, which holds that consumers will not buy enough of the organizations products unless it undertakes a large selling and promotion effort. The concept is typically practiced with unsought goods those that buyers do not normally think of buying (say, encyclopedias and funeral plots). These industries must be good at tracking down prospects and selling them on product benefits.

Product Example:
Sony Walkman Apple iPod

Selling Concept
The selling concept is also practiced in the nonprofit area. A political party, for example, will vigorously sell its candidate to voters as a fantastic person for a job. The candidate works in voting precincts from dawn to dusk, shaking hands, kissing babies, meeting donors, making speeches. Much money is spent on radio and television advertising, posters, and mailings. Candidate flaws are hidden from the public because the aim is to get the sale, not worry about consumer satisfaction afterward. The marketing concept holds that achieving organization goals depends on determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiently than competitors. Surprisingly, this concept is a relatively recent business philosophy. It emerged only during the 1950-s. the marketing concept has been stated in such colorful ways as Find a need and fill it (Kaiser Sand & Gravel); We do it like youd do it (Burger King); and Were not satisfied until you are (GE). J.C. Penneys motto also summarizes the marketing concept: To do all in our power to pack the customers dollar full of value, quality, and satisfaction.

Product Example:
Youtube Gucci

Marketing Concept
The marketing concept viewes the consumer as the focal point of all marketing activities. Organizations that practice the marketing concept study the consumer to determine consumers needs and wants and then organize and integrate all activities within the firm toward helping the consumer fulfill these needs and wants while simultaneously achieving organizational goals. There are three pillars to the marketing concept: (1) consumer orientation, (2) integrated or total company effort, and (3) achievement of organization goals. The consumer orientation dimension of the marketing concept argues that a firm can be more successful if it determines what the consumer needs and wants before it decides what product to produce or/and sell. To successfully practice the principle of consumer orientation firms need to regularly conduct marketing research. Marketing research is the systematic collection, recording, and analyzing of data that deal with the marketing of goods and services. The tools of marketing research allow the firm to assess consumers needs-wants. Regardless of how much marketing research is conducted, no organization can be certain of consumers wants and needs. This is especially true with new product development or anticipatory manufacturing. For instance, Firestone Tire Company must produce snow tires in the summer for the coming fall and winter season. No matter how much research Firestone conducts it will still face some uncertainty about the weather and therefore may overproduce or underproduce snow fires for the coming season. Consequently, the role of good executive judgement in marketing decision-making cannot be ignored. Since marketing is not a precise science, good subjective judgement resulting from years of hands on experience is also a key to successfully implementing the marketing concept. A second pillar of the marketing concept is the principle of integrated effort, in which departments within the organization work together toward the common goal of satisfying the customer. Integrated effort is a systems point of view, in which all departments recognize they are interdependent parts of an organization. Because they are interdependent, they must cooperate to enable the firm to achieve its objectives. Cooperation is often difficult because one departments goals may conflict with those of another department and with the organizations overall objectives. Several types of conflicts can develop between departments within an organization. One type is the inherent conflict between low unit production costs and high consumer satisfaction. For instance, if Sony were to standardize all its television production in a single style than it could achieve significantly lower costs per television produced. However, this would hurt Sonys marketing efforts because most consumers want variety and selection when purchasing a new television. Organizational goals. The final pillar of the marketing concept state that the organization should engage in exchanges based on their potential for helping the organization achieve its

goals. Organizations dont participate without expecting something in return, and what they receive should help them achieve their objectives.

Product Example:
Ufone its all about U Nike Just do it