Marketing and Its Approaches (1) PDF

Prepared by: Ms. Perla Cruzada LESSON 1- WHAT IS MARKETING AND ITS TRADITIONAL APPROACHES At the end of the lesson, the students will be able to: Explain marketing as a process Identify the activities in the marketing process Distingu...

Prepared by: Ms. Perla Cruzada LESSON 1- WHAT IS MARKETING AND ITS TRADITIONAL APPROACHES At the end of the lesson, the students will be able to: Explain marketing as a process Identify the activities in the marketing process Distinguish goods, services, and ideas as products Define the four traditional approaches in marketing MARKETING IS EVERYWHERE  From the moment you wake up in the morning until you go to bed at night, all of your activities throughout the day likely involved marketing. How so? Try to recall the times you went to purchase something in a store. Which of the products you bought and services you availed of were given marketing support such as advertisement, flyers, or promos? MARKETING IS EVERYWHERE  The subtle but powerful effect of marketing on us can be seen in our preference for certain products and services. For example, what do you do the moment you wake up? Most probably, you grab your phone first to check the time or turn of your alarm. What is the brand of your phone? Is it Samsung,Apple or Cherry Mobile? MARKETING IS EVERYWHERE How about the mobile network you are using? Is it Smart, Globe or Sun Cellular? Which fast food chain do you prefer? Is it Jollibee, KFC, Chowking, or McDonald’s? Which clothing brand do you like the most? Is it Bench, Penshoppe, Human or Dickies? All of these questions are linked to brands that you are familiar with. These brands manifest a certain personality which consumer tends to identify with.  MARKETING IS EVERYWHERE  The brands personality is what every marketer should develop, nurture, and protect. Once the brand becomes embedded in the minds of consumers, it can become the top choice in their purchases.  Over time, these brands become so secured and positioned in the consumers’ minds that a long term value is developed. If the brand and the brand category (into which the brand is classified) are uniquely intertwined, the brand and the product become one and the same. That is, the brand names becomes the generic name of the product. This phenomenon is called the generic effect. MARKETING IS EVERYWHERE  For example, Colgate (brand name) has become synonymous with the word “toothpaste” so some would say “Pabili ng Colgate na Closeup” (Can I buy a Colgate that is a Closeup). The generic identity of the product (toothpaste) is now directly represented by Colgate, although the customer really wants to buy the Closeup brand. MARKETING IS EVERYWHERE  Older pioneering companies have successfully monopolized their respective product category with their brands.  Some of these brands are Coke (soft drinks), Bear Brand (milk brand), Kraft (cheese), Xerox (photocopiers), and Kodak (photography).  MARKETING IS EVERYWHERE  This generic effect is achieved if the product is well-positioned or is clearly and effectively communicated to the consumers. Thus, marketers nowadays face greater challenges than those in the past.  Marketers are requires not only to adhere to customer preferences but also to meet societal and environmental demands.  This is also why consumers need a certain level of marketing knowledge to properly communicate their demands on these marketers.  In your case as a student, this knowledge will benefit you not only a consumer but also a future marketing professional. WHAT IS MARKETING  Kotler and Armstrong (2013) describe marketing as “managing the customers profitably.” the brief definition captures the meaning marketing in its practical sense; that is, without customers, marketing will be impossible.  Marketing is also the process of conceptualizing, creating, developing, promoting, and sustaining products and services by a company, focusing on the needs and preferences of the customer.  Following the process, marketers acquire “desirable customers” and satisfy their needs which result in these customers becoming loyal patrons. Developing and maintaining loyal customers I the major objective and challenge of marketing.  WHAT IS MARKETING The American Marketing Association (2013), defines marketing as follows:  Marketing is the activity, set of institutions, and process of creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners and society at large. Thus, marketing is the action or business of promoting or selling products or services to specific groups of customers. Whether people realize it or not, marketing is part of daily life. THE MARKETING CONCEPT  One usually relates marketing with selling or advertising.  This is expected of the majority of consumers, since TV commercials and radio advertisements are constantly aired and sales marketing is extensively practiced by sales agents from different companies.  However, sales and advertising are only two of the marketing functions of a larger marketing mix. Today, marketing is more than just advertising and selling product to customers; it also focuses on the satisfaction of customer needs. Marketing Advertising Selling Satisfaction of Customer Needs  THE MARKETING CONCEPT  In this regard, marketing has been defined as the process by which companies create value for customers and build strong customer relationships in order to capture value for customers in exchange. However, this has not always been the case.  As mentioned earlier, marketing has been practiced since the early civilization, but the relationship involved was practically limited to trading of goods.  THE MARKETING CONCEPT  It was only in the only 1930s, when mass production became commonplace and the number of companies producing the same products increased, that the relationship between producers and consumers was highlighted.  This ushered in the concept of competition, which prompted rival companies to resort to hard-selling and advertising their products to their customers to increase their sales. THE MARKETING CONCEPT  Profit was the main target of these companies. Nevertheless, they failed to foresee the change in the consumer’s demands for newer products.  After World War II ended in 1945, people started to have increased income and thus, had this means to become more selective with the products they buy.  THE MARKETING CONCEPT  Recognizing this, companies shifted their focus towards catering to the emerging customers’ preferences.  Separate marketing departments with responsibilities beyond the selling function, such as research and development, advertising and outsourcing, were established to ultimately satisfy customer needs.  Business companies nowadays have developed and incorporated contemporary marketing techniques to further improve their marketing efforts. THE EVOLUTION OF MARKETING PROCESS  Just as any branch of knowledge, marketing started from a simple activity and has developed into a formal discipline over time.  Marketing activities were first practiced during the Industrial Revolution as product were mass- produced and then sold to awaiting customers. THE EVOLUTION OF MARKETING PROCESS  Even the concept of marketers at the time was fairly new. When market co petition became prevalent and demand for newer products emerged, marketers developed new approaches to address these problems. TRADITIONAL MARKETING APPROACHES Starting in the 1950’s, traditional marketing followed five major approaches guided marketers in designing their marketing strategies. These approaches are as follows: Production Product Selling Orientation Orientation Orientation Marketing Societal Orientation Orientation  PRODUCTION ORIENTATION  This approach requires a company to embark on mass production and distribution. This means that the company produces a large quantity of a product and makes it available to all potential consumers.  This approach was perfected by Ford Motor Company in early 1950’s. At that time, Ford marketed only one model design and made the car affordable for the majority of the customers. However the limitation of the production approach This is known as is when a company manufactures only one product marketing in large quantities and fails to identify the number myopia or of customer who are willing to buy them, the marketing short company end up with surplus products. sightedness. PRODUCTION ORIENTATION In the case of Ford, after its initial success the demand for its vehicles started to decline due to the demand of variety. Ford failed to foresee the changes in the demand bought about changes in the customers’ preferences. At present, this approach is employed by many start-up business. Some entrepreneurs for instance, start their business believing that they have a unique product. They commence with the production and distribution with only a vague idea of the needs of the needs of their intended market. PRODUCTION ORIENTATION In this case, their efforts at selling the product is like “shooting a target in the dark.” Often, these companies do not attract enough customers, resulting in low profits and the eventual closure of their business.  PRODUCT ORIENTATION  This approach focuses on the product and its innovation to attract customers.  This approach was considered a solution to the limitations of the production orientation. For example, Apple initially released its first iPhone in 2007. Over the years, Apple has continued to innovate the iPhone with additional designs and features. PRODUCT ORIENTATION  This approach, however, has a number of limitations.  First, customer, may consider the new features unnecessary and would therefore not be convinced to buy the product.  Second, the product is often improvised and manufactured without understanding the needs of the customers and their willingness to spend for it. Thus, product orientation could also lead to marketing myopia if marketers are too focused on the product and not on the needs, wants, and expectations of the market. SELLING ORIENTATION  This approach relies on the strength of the company’s sales force in convincing the customers to buy the product even if they do not need it.  The mastery in selling techniques or the use of aggressive selling tactics likely guaranties sales, although this is achieved through hard selling. SELLING ORIENTATION  However, since this approach prioritizes sales, it pays little attention to the customers’ actual need for the product, which results in the failure of the business.  Today, some organizations still use this type of approach, but with the caveat of having to deal with economical or practical consumers who avoid buying products they do not need. MARKETING ORIENTATION  The company  In this approach, the researches about the customers’ target customers (the customers who preferences are would be served best prioritized. by the company) and matches the result of  what they want, how much their research with they are willing to pay, the offering (product  what form and feature they or service) of the prefer, etc. company. MARKETING ORIENTATION  This approach is also known as the customer-centric approach.  Although this approach is more advantageous than the first three approaches, its implementation has a drawback.  If the customers’ needs and wants are satisfied,  What happens to the society and the environment affected by these marketing activities?  Would the product or service still be offered if it is harms the environment?  Does the product or service contribute to the customer’s quality of life? SOCIETAL MARKETING ORIENTATION  This is similar to marketing orientation except that concern for society’s well-being and the environment’s sustainability is prioritized as much as the customers’ preferences.  Thus, the development of products that contribute to the quality of life and the environment is encouraged and often supported by cause-oriented groups.  This marketing is also called green marketing and the product is called a green product. TRADITIONAL MARKETING APPROACHES  Over time, marketers are challenged by different marketing issues.  A number of factors have emerged which rendered the traditional marketing approaches ineffective.  Particularly, modern customers have become more knowledgeable and cautious buyers.  They have become more empowered because of the ease of access to information brought about by the internet and technology. TRADITIONAL MARKETING APPROACHES  They can easily distinguish between brand names of products and services, and do not associate a certain product or service with one particular brand.  The new generation of consumers is meticulous, bargains for the best value, and easily shifts loyalty to other products.  This prompted business to come up with new approaches to meet the needs of the modern consumer.  Therefore, the marketing process was developed for business to adapt to the constantly changing world. Click “reply” and post your questions in the text box provided. 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