Day 1: Introduction to Marketing

Evolution of Marketing:
Philip Kotler has given five completive/alternative concepts.

These concepts may be termed as the approaches or, sometimes, the evolution stages of marketing
development. When they are taken as the evolution stages, the order (sequence) from the first
concept to the last concept must be maintained. First three concepts are traditional; the forth is
modern concept; and the last is the latest concept. Today’s marketing practices are based on
combination of last three concepts. Figure 2 shows alternative concepts with key elements.

1. Production concepts
2. Product Concept
3. Selling Concept
4. Marketing Concept
5. Holistic Marketing Concept

Production Concept:
Elements of the production concept include:
i. Low price
ii. Easy/wide availability of product
“The production concept holds that consumers will favor those products that are widely available
and low in cost. Managers of production-oriented organizations concentrate on achieving higher
production efficiency and wide distribution coverage.”

Product Concept:

“The product concept holds that consumers will favor those products that offer the most quality,
performance, and innovative features. Managers in product-oriented organizations focus their energy on
making superior products and improving them over time.”

Elements of the selling concept include:

i. Low price.

ii. Wide availability.

iii. Better qualities, innovative features, and performance.

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Om Jee Gupta, Assistant Professor, PSIT College of Higher Education
Selling Concept:

The selling concept holds that consumers, if left alone, will ordinarily not buy enough of the
organization’s products. The organization must, therefore, undertake aggressive selling and
promotional efforts.

Elements of selling concept include:

i. Low price.

ii. Wide availability.

iii. Quality, innovative features, and performance.

iv. Aggressive selling and promotional efforts.

Marketing Concept:

The marketing concept holds that the key to achieve organizational goals consists in determining
the needs and wants of target markets and delivering the desired satisfaction more effectively and
efficiently than competitors.

Recently He has said: Philip Kotler has stated: “The marketing concept holds that the key to
achieving organizational goals consists of being more effective than competitors in integrating
marketing activities toward determining and satisfying the needs and wants of target markets.

Elements of the marketing concept include:

i. Low price.

ii. Wide availability.

iii. Quality, features, and performance.

iv. Selling and promotional efforts.

v. Target markets (instead of total market).

vi. Integrated marketing.

vii. Emphasis on consumer satisfaction.

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Om Jee Gupta, Assistant Professor, PSIT College of Higher Education
Key Elements or Pillars of Marketing Concept:

Elements are also called pillars of the marketing concept.

Marketing concept is based on four elements (over and above the individual elements of the former
four concepts), such as:

1. Consumer Orientation:

Consumer orientation means designing entire marketing programme (4’P’s) in such way that
maximum consumer satisfaction can be achieved. Marketing efforts are directed to satisfy
consumers. Every decision is taken to satisfy needs and wants of the target consumers. Due to
competition, the marker tries to satisfy customers more effectively and efficiently than the
competitors.

2. Target Market Focus:

Target market means the well-defined specific groups of consumers whose needs and wants a
company wants to satisfy. No company, with whatever capacity and resources, can satisfy all the
needs of all the consumers. Therefore, it is necessary to define and select specific groups of
consumers, which can be said as target market. It is the aimed market for which product is
manufactured; price is set; promotional efforts are undertaken; and distribution network is
designed.

3. Profitability:

Marketing concept emphasizes on adequate profits. Every company must earn the adequate profits
with reference to amount of investment and degree of risk. But, the essential condition is that a
company should earn profit along with consumer satisfaction. The matching offers satisfy
consumers’ needs and wants, and the desired level of profits satisfies the company.

4. Integrated Marketing:

Customer satisfaction is the result of integrated efforts of all the employees of various departments
in the organization. Consumer satisfaction requires the active involvement and full commitment
of all the departments including production, personnel, finance, and marketing. Unless their efforts

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Om Jee Gupta, Assistant Professor, PSIT College of Higher Education
are integrated, the desired products cannot be produced and distributed to the target market. There
must be high degree of cooperation and coordination among departments of organization.

Holistic Marketing:

A holistic marketing concept is based on the development, design and implementation of

marketing programs, processes and activities that recognize the breadth and inter-dependencies.
Holistic marketing recognizes that ‘everything matters’ with marketing and that a broad, integrated
perspective is necessary to attain the best solution.

Internal Marketing: Internal marketing is based on the theme that employees are the internal
customers of a firm and their satisfaction is of utmost importance in order to achieve the goal of
customer satisfaction. Internal marketing ensures building a skilled and self-motivated workforce
and that every member of the organization properly understands the company’s marketing
orientation and philosophy towards the customer satisfaction. Internal marketing is also about
maintaining harmony and co-ordination among various marketing functions and activities within
the organization. There should not be any conflicts within the marketing department or between

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Om Jee Gupta, Assistant Professor, PSIT College of Higher Education
marketing and other departments because that would somehow negatively affect external
marketing also.

Integrated Marketing: Integrated marketing is based on the proposition that the marketers instead
of deciding for individual marketing activities should make an integrated marketing program with
the purpose to create, communicate and deliver value for the customers. The aim of integrated
marketing is to gain synergy out of all marketing activities and it is only possible when an
integrated approach is adopted. It is basically about designing an effective integrated marketing
mix executed well to derive synergy.

Relationship Marketing: Relationship marketing is concerned with building long-lasting

relationships with various parties connected to a business including the customers, employees,
suppliers, financial institutions, regulatory bodies, competitive firms and the society in general.
Relationship marketing is about building relationships with all those who can affect the firm’s
success or are capable of adding value to it at any level. The traditional selling approach where the
customers and firm interacted only during sales is no more acceptable in current environment.
Today the firms need to maintain a regular contact and keep reminding of the brand to the
customers. Repeat purchases by the customers demand a strong relationship with them.
Relationship marketing suggests not only building relationships but also enhancing them over the
time

Societal Marketing/ Socially Responsible Marketing: Holistic marketing suggests that the
marketer’s responsibility is not limited to the customers but it extends to the society in general.
Societal marketing suggests that marketing should consider ethics, society, laws and the
environment while designing activities. Any such marketing activities which are economically
profitable but socially harmful are strictly restricted under societal marketing aspect of holistic
marketing. The marketing should not adopt an irresponsible behavior towards the society. The
increasing popularity of societal marketing aspect can be well understood by the larger evidences
of corporate social responsibility activities undertaken by most firms now days.

Example of Holistic Marketing Concept:

It is without doubt that an organization has various departments like R&D and product
development, sales and marketing, accounting and finance, and lastly HR and operations. Hence

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Om Jee Gupta, Assistant Professor, PSIT College of Higher Education
in order to have a holistic marketing concept introduced in the business then the product
development and R&D should accept the comments and views from the sales and marketing
department in order to launch the product in the market for the customers to buy it. Then again
these departments should work intimately with accounting plus finance to get the precise financial
plan for the project. Sales plus marketing should communicate with the HR section to get the exact
kind of personnel that they require, and at last, admin as well as operations should work out a plan
to hold these personnel. In this way, in the above approach, a business can get the exact product at
an exact price with the exact benefits. Alongside this, a business can get the exact individuals who
will advertise the product in the exact way. If a business does all these things, then it can be certain
to get the right consumer at its doorstep. This is the complete embodiment of holistic marketing
concept.

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Om Jee Gupta, Assistant Professor, PSIT College of Higher Education
 Market

The term “market” originates from the Latin word “Marcatus” which means “a place where business is

conducted.” A layman regards market as a place where buyers and sellers personally interact and finalize

deals.

Market in Marketing Perspective

According to Philip Kotler a market from a marketer’s point of is “collection of customers”.

According to Perreault and McCarthy, market is defined as a group of potential customers with similar

needs or wants who are willing to exchange something of value with sellers offering various goods and/or

services to satisfy those needs or wants. This can be done face-to-face at some physical location (for

example, a farmer’s market) or it can be done indirectly through a complex network that links middlemen,

buyers and sellers living far apart. Depending upon what is involved, there are different types of markets

which deals with products and/or services such as

(1) Consumer Market: In this market the consumers obtain what they need or want for their personal or

family consumption. This market can be subdivided into two parts—fast moving consumer goods market

from where the consumers buy the products like toothpaste, biscuits, facial cream etc. and services like

internet, transportation etc. Another is durables market from where, the consumers buy the products of
longer life like motorcycles, cars, washing machines etc. and services like insurance cover, fixed deposits

in the banks and non-banking financial companies etc.

(2) Industrial/Business Market: In this market, the industrial or business buyers purchase products like

raw materials (iron ore, coke, crude oil etc.), components (tyres, picture tubes, micro-processors etc),

finished products (packaging machine, generators etc.), office supplies (computers, pens, paper etc.) and

maintenance and repair items (grease, lubricating oil, broom etc.). Apart from products, now-a-days due to

outsourcing the industrial buyers also require a number of services like accounting services, security

services, advertising, legal services etc. from the providers of these services.

(3) Global Market: it is integration of international markets. The world is rapidly moving towards

borderless society thanks to information revolution and the efforts of WTO to lower the tariff and nontariff

barriers. The product manufacturers and service providers are moving in different countries to sustain and

increase their sales and profits. Although the global companies from the developed countries are more in

number (McDonald’s, Ford Motors, IBM, Sony, Citi Bank etc.); the companies from developing countries

are also making their presence felt in foreign countries

(4) Non-Profit and Governmental Markets: Non-profit organizations such as charitable trusts,

universities, churches, temples, government agencies etc. can be collectively called as Non-Profit and

Governmental Markets. Companies selling their products to non-profit and governmental markets need to

price carefully, because these buyers have limited purchasing power.

Marketing

Definitions:

1. Marketing is the process that seeks to influence voluntary exchange transactions between a

customer and a marketer. —William G. Zikmund and Michael d’Amico

 2. Marketing is the process of discovering and translating consumer needs and wants into products

and services, creating demand for these products and services and then in turn expanding this

demand. —H.L. Hansen.

3. Marketing is the business process by which products are matched with markets and through which

transfer of ownership are affected. —Edward W. Cundiff

4. According to Philip Kotler “Marketing is a societal process by which individuals and groups

obtain what they need and want through creating, offering and freely exchanging products and

services of value with others”.

5. American Marketing Association offers a formal definition: “Marketing is an organizational

function and a set of processes for creating, communicating, and delivering value to customers and

for managing customer relationships in ways that benefit the organization and its stakeholders”.

Nature of Marketing

Nature of Marketing evolves from its multidisciplinary coverage of activities which is as follow:

1. Customer Oriented: Marketing is customer oriented. Marketing is the process of finding needs and

wants of customers and satisfying those needs profitably.

2. Dynamic Process: Marketing is an ongoing activity which does not stop at any step. After finding

customer’s needs and wants it needs to develop such products or services which can satisfy these needs and

after this there is need to do promotion, distribution, etc the process goes on.

3. Core Functional Area: Marketing is the core functional area of modern day organizations and is

the driving force behind every organization. Marketing provides the vital input for corporate planning which

in turn dictates the plans for other functional areas. Marketing focuses on achieving customer satisfaction

through fulfilling their needs. Satisfied customers are likely to stay with organization, as a result

organization remain in business.

 4. Integrating: Marketing integrates all the departments of an enterprise be it production, finance, IT,

HR, etc. Marketing is interlinked with other functional areas of the organization. Marketing people collects

the information regarding (customer’s requirements and pass it to) the research and development and

engineering people who‘ll turn the customer requirements into the product or service features. The finance

people help in obtaining the money for the development of new product, and also help in arriving at the

final price decision. The human resource department provides the necessary manpower for carrying out

various activities not only in the marketing area but also in the other functional areas.

5. Creative: Marketing is creative in nature, it looks out for new ideas, views and activities and solves

problems or avail opportunities in a creative way.

Scope of Marketing

1. Marketing is typically seen as the task of creating, promoting and delivering goods and services to
consumers and businesses. In fact, marketing people are involved in marketing 10 types of entities:

1. Marketing people market following 10

entities:
I. Goods
II. Services
III. Events
IV. Experiences
I. Goods—
V. Good is defined as something tangible that can be offered to market to satisfy a need or want.
Physical goods constitute the bulk of most countries production and marketing effort. In a
VI. developing country like India fast moving consumer goods (shampoo, bread, ketchup, cigarettes,
VII. newspapers etc.) and consumer durables (television, gas appliances, fans etc.) are produced and
consumed in large quantities every year.
VIII.
II. Services—
A service can be defined as any performance that one party can offer to another that is essentially
IX. intangible. Its production may or may not be tied to a physical product. Services include the work

X.
 of hotels, airlines, banks, insurance companies, transportation corporations etc. as well as
professionals like lawyers, doctors, teachers etc. Many market offerings consist of a variable mix
of goods and services. For example at a fast food restaurant, the customer consumes both a product
and a service.
III. Experiences—
By mixing several services and goods, one can create stage and market experiences. For example
water parks, zoos, museums etc. provide the experiences which are not the part of routine life.
There is a market for different experiences such as climbing Mount Everest or Kanchanjunga,
travelling in Palace on Wheels, river rafting etc.
IV. Events—
Marketers promote time–based, theme-based or special events such as Olympics, company
anniversaries, sports events (Samsung Cup—India Pakistan Cricket Series), artistic performances
(Lata Mangeshkar live concert, Jagjit Singh live concert), trade shows (International Book Fair at
Pragati Maidan, Automobile fair), award ceremonies (Filmfare awards, Screen awards), beauty
contests (Miss World, Miss Universe, Miss India, Miss Chandigarh).
V. Persons—
Artists, musicians, high profile lawyers and other professionals can also be marketed. Celebrity
marketing has become a major business. Years ago, someone seeking fame would hire a press agent
to plant stories in newspapers and magazines. Today most of cricket players like Sachin Tendulkar,
Saurav Ganguly, Virat Kohali etc. are drawing help from celebrity marketers to get the maximum
benefit.
VI. Places—
Places–cities, states, regions and whole nations—compete actively to attract tourists, factories,
company headquarters and new residents. India and China are competing actively to attract foreign
companies to make their production hub. Cities like Bangalore, Hyderabad and Gurgaon are
promoted as centre for development of software. Bangalore is regarded as software capital of India
and Hyderabad is emerging as the hub of biotechnology industry. The government of India is
marketing India as a tourist destination through the “Incredible India” advertising campaign.
VII. Properties—
Properties are intangible rights of ownership of either real property (real estate) or financial
property (share and debt. instruments). Properties are bought and sold, and this requires marketing
effort. Property dealers in India work for property owners or seekers to sell or buy plots, residential
or commercial real estate.
VIII. Organizations—
Organizations actively work to build a strong, favorable image in the mind of their public.
Companies can gain immensely by associating themselves with the social causes. Universities and
colleges are trying to boost their image to compete successfully for attracting the students by
mentioning their NAAC grades in the advertisements and information brochures.
IX. Information—
Information can be produced and marketed as a product. This is essentially what schools, colleges
and universities produce and distribute at a price to parents, students and communities. News papers
like Times of India and Magazines such as India Today provide information about the things
happening around us.
X. Ideas—
 Film makers, marketing executives and advertising continuously look for a creative spark or an
idea that can improve their work. Idea here means the social cause or an issue that can change the
life of many.

2. Channels of distribution

The pathway through which the goods move from producer to consumer is the channel of distribution. It
includes a number of intermediaries like wholesaler, retailers etc.

3. Physical distribution

The physical movement of the goods from producer to consumer is physical distribution. It includes
transportation, warehouses, inventory control, etc.

4. Promotional decisions

Being an excellent product is not sufficient to get sold if customers are unaware of it, therefore there is need
to promote it properly. The basic objective of promotion is to inform the market about the product features
and its availability.

5. Pricing decisions

This is an important element of marketing to generate revenue. Factors such as cost, competitor’s price,
pricing policies, purchasing power of customers are generally taken into consideration for setting up the
price.

6. Environmental analysis

The various micro and macro factors should be analyzed to develop the understanding about the strength,
weaknesses, opportunities, and threats, for an organization. This understanding helps in formulating the
marketing strategies.

7. Marketing research

As marketing starts from the need assessment of customers, marketing research helps to find out the relevant
information from market through a systematic study.

8. Consumer behavior

Marketers are eager to analyze the patterns of taste, preferences and purchasing habits of consumers, in
order to develop a better understanding of consumers to satisfy them.

9. Feedback from customers

For successful marketing of goods it is essential that the marketer obtains the required feedback from
customers. A proper feedback mechanism should be developed so that reasons for failure or less satisfaction
may be identified and improvements in the products be made.
 10. Responsibility towards society

Business and society are interrelated and interdependent. It derives much needed inputs from society. These
social activities are the part of marketing as the units have to protect and promote the interest of the society.

Importance of Marketing
(A) To the Society

1. Improves living standards: It is instrumental in improving the living standards. Marketing

continuously identifies the needs and wants satisfying products or services which can propel the
people to do an extra to earn money which can be exchanged for the desired products or services.
Thus marketing by indirectly increasing the earning ability will help in improving the standard of
living of the customers.
2. Generates gainful employment opportunities: Marketing generates gainful employment
opportunities both directly and indirectly. Directly, marketing provides employment to the people
in various areas like in advertising agency, in the company sales force, in the distributor’s sales
force, in public relation firms etc. Indirectly, marketing is responsible for selling the offerings of
the organization. If the organization’s products or services are able to satisfy the customers, then
customers will demand organization’s products or services again and again, thereby sustaining the
production activities. Thus marketing indirectly provides employment in other functional areas like
finance, production, research and development, human resource management etc.
3. Helps in stabilizing economic condition. Marketing helps in stabilizing economic condition in
the sense that marketing helps in selling the products or services, which keeps the various
organizations functioning and gainful employment is available to the people. With the earnings
from the employment, the people will purchase the products and/or services, thus sustaining the
demand. This will happen in all the industries, then gainful employment will be available
throughout the time period and economy will remain stable, healthy and vibrant.

(B) To the firms/companies

1. Generates Profit: Marketing sustains the company by bringing in profits. Marketing is the
only activity that brings revenue to the firm, whereas other activities incur expenditure. If the company’s
products or services satisfy the customer’s requirements, then the satisfied customers will keep the company
in business by repeat orders and recommending other profitable customers. Thus marketing is the driving
force behind a successful company.

2. Source of new ideas: Marketing is the source of new ideas. New product or service ideas usually come
from the research laboratories, employees or from marketplace. It’s the marketing people who are in
continuous touch with the consumers and marketing intermediaries. Interaction with them helps in
identifying strong and weak points of company’s product or services as well as competitor’s products or
services. This interaction can also help in identifying unmet needs or wants of the consumers and the
features, consumers are looking into the products or services which can satisfy those unmet needs or wants.
Thus marketing can help immensely in identifying new product or service ideas which can help in sustaining
the firm’s operations. Successful companies, identify customer’s requirements early and provides the
solution earlier than the competitors.
 3. Provides direction for the future: Marketing provides direction for the future course. The marketing
oriented company continuously brings out new product and service ideas which provide the direction for
corporate strategic planning for longer time horizon.

(C) To the Customers

1. Fulfills the need: Marketing identifies those needs or wants which were not satisfied and helps in
developing the product or service which can satisfy those unmet needs or wants of the people. For example
a number of drugs were invented to treat various physical problems of the people. Again the low cost
formulations were developed to treat the people who are unable to afford the expensive drugs.

2. Reducing the price of products: Marketing helps in popularizing the product or service which attracts
the customers as well as competitors towards that product or service categories. Due to increase in demand,
the manufacturing capacity increase which brings down per unit fixed costs of the product or service.
Furthermore increase in competition led to decrease in the prices charged by the firm. Thus the growing
demand and increasing competition both help in bringing down the price of the product or service.

3. Convenience in availability of products: Marketing is also responsible for making products available
to the customers at suitable places. Marketers workout on distribution channels and delivery mechanisms
to take their products to customers.
 Marketing Management
According to Philip Kotler, “Marketing Management is the art and science of choosing target markets
and getting, keeping, and growing customers through creating, delivering, and communicating superior
customer value”.

The American Marketing Association offers the following definition:

Marketing Management is the process of planning and executing the conception, pricing, promotion, and
distribution of ideas, goods, services to create exchanges that satisfy individual and organizational goals.

Core Concepts of Marketing

Marketing can be further understood by defining several of its core concepts.

1. Needs, Wants and Demand

Need: It is state of deprivation of some basic satisfaction. eg.- food, clothing, safety, shelter.

Want: Desire for specific satisfier of need. eg.- Indians needs food – want rice or
chapati. Americans needs food- want burger or French fries.

Demand: Want for a specific product backed up by ability and willingness to buy.

eg.- Need – transportation.

Want – Car (say, Mercedes, Maruti, Audi)……but able to buy only Maruti. Therefore, demand is Maruti.

Marketers cannot create needs. Needs preexists. Marketers can influence wants. This is done in
combination with societal influencers.

2. Product or Offering

People satisfy their needs and wants with products. A product is any offering that can satisfy a need or
want. The major types of basic offerings are goods, services, experiences, events, persons, places,
properties, organizations, information, and ideas.

3. Value and Satisfaction:

The product or offering will be successful if it delivers value and satisfaction to the target buyer. The buyer
chooses between different offerings on the basis of which is perceived to deliver the most value. We define
value as a ratio between what the customer gets and what he gives. The customer gets benefits and assumes
costs. The benefits include functional benefits and emotional benefits. The costs include monetary costs,
time costs, energy costs, and psychic costs.
Thus, value is given by:

Value = Benefits/ Costs

Benefits = Functional benefits + emotional benefits

Costs= monetary costs + time costs + energy cost + psychic costs

Value=Functional benefits + emotional benefits/ monetary costs + time costs + energy

cost + psychic costs

4. Exchange & Transaction

Exchange: – The act/ process of obtaining a desired product from someone by offering something in
return. For exchange potential to exist, the following conditions must be fulfilled.

1. There are at least two parties.

2. Each party has something that might be of value to the other party.
3. Each party is capable of communication and delivery
4. Each party is free to accept or reject the exchange offer.
5. Each party believes it is appropriate or desirable to deal with the other party

Transaction: – Event that happens at the end of an exchange. Exchange is a process towards an
agreement. When agreement is reached, we say a transaction has taken place.

5. Target Markets, Positioning, and Segmentation

Not everyone likes the same cereal, restaurant, college, or movie. Therefore, marketers start by dividing the
market into segments. They identify and profile distinct groups of buyers who might prefer or require
varying product and service mixes by examining demographic, psychographic, and behavioral differences
among buyers. After identifying market segments, the marketer decides which present the greatest
opportunities— which are its target markets. For each, the firm develops a market offering that it positions
in the minds of the target buyers as delivering some central benefit(s). Volkswagen develops its cars for
buyers to whom safety is a major concern, positioning its vehicles as the safest a customer can buy.

6. Marketing Channels

To reach a target market, the marketer uses three kinds of marketing channels.

I. Communication Channels- Communication channels deliver and receive messages from target
buyers and include newspapers, magazines, radio, television, mail, telephone, and the Internet.
Beyond these, firms communicate through the look of their retail stores and Web sites and other
media. Marketers are increasingly adding dialogue channels such as e-mail, blogs, and toll-free
numbers to familiar monologue channels such as ads.
II. Distribution Channels- The marketer uses distribution channels to display, sell, or deliver the
physical product or service(s) to the buyer or user. These channels may be direct via the Internet,
 mail, or mobile phone or telephone, or indirect with distributors, wholesalers, retailers, and agents
as intermediaries.
III. Service Channels- To carry out transactions with potential buyers, the marketer also uses service
channels that include warehouses, transportation companies, banks, and insurance companies.
Marketers clearly face a design challenge in choosing the best mix of communication, distribution,
and service channels for their offerings.

7. Supply Chain

The supply chain is a longer channel stretching from raw materials to components to finished products
carried to final buyers. Companies work on managing good relations with supply chain partners and flow
of information to get timely availability of product to end customer without increasing the total cost.

8. Competition

Competition includes all the actual and potential rival offerings and substitutes a buyer might consider e.g.
in India, a customer looking for a two wheeler automobile will find TVS, Baja, Hero etc. as a major
competitor, striving to satisfy their customers to overtake competitors.

9. Marketing Environment

The marketing environment consists of the task environment and the broad environment.

The task environment includes the actors engaged in producing, distributing, and promoting the offering.
These are the company, suppliers, distributors, dealers, and target customers. In the supplier group are
material suppliers and service suppliers, such as marketing research agencies, advertising agencies, banking
and insurance companies, transportation companies, and telecommunications companies. Distributors and
dealers include agents, brokers, manufacturer representatives, and others who facilitate finding and selling
to customers.

The broad environment consists of six components: demographic environment, economic environment,
social-cultural environment, natural environment, technological environment, and political-legal
environment. Marketers must pay close attention to the trends and developments in these and adjust their
marketing strategies as needed.
 Week IV Notes

Difference between Selling and Marketing

Selling Marketing

Marketing focuses on the needs of the

1 Selling focuses on the needs of the seller
customer

The firm makes a ‘total product offering’

The firm makes the product first and then
2 that will match and satisfy the identified
figures out how to sell it and make profit.
needs of the customer.

Seeks to quickly convert ‘products’ into Seeks to convert customer ‘needs’ into
3
‘cash’ ‘products’.

Puts efforts on creating, communicating,

4 Puts efforts on rigorous convincing
and delivering value to customer

5 Selling is push strategy Marketing is pull strategy

Difference between Traditional Marketing and Modern Marketing Concept

Traditional Marketing Modern Marketing

This concept starts with the product which This concept starts with finding the needs
1
is produced in the factories and wants of the target market

It stresses upon the product of the It stresses upon the needs and want of the
2
manufacturer customer

It focuses on the need and interest of the It focuses on the need and interest of the
3
producer customers

The objective is to maximize profit by The objective is profit but through

4
maximizing sales customer satisfaction

The objectives are achieved through

The objectives are achieved through selling
5 coordinated efforts for product, price, place
and promotion generally
and promotion

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 The New Marketing Realities
• Technology

– Digital Balance sheet

• Globalization

– New Transportation

– Shipping

– Communication technologies

– To sell or buy around the world

• Social Responsibility

– Poverty, pollution, Water shortages, climate change, wars and wealth concentration.

Marketing Myopia
Marketing myopia was used in marketing by Theodore Levitt in his research paper published in 1960 in
the Harvard Business Review.

Marketing Myopia suggests that businesses will do better in the end if they concentrate on meeting
customers’ needs rather than on selling products.

The Myopic cultures, Levitt postulated, would pave the way for a business to fall, due to the short-sighted
mindset and illusion that a firm is in a so-called 'growth industry'. This belief leads to complacency and a
loss of sight of what customers want. It is said that these people focus more on the original product and
refuse to adapt directly to the needs and wants of the consumer.

To continue growing, companies must ascertain and act on their customers’ needs and desires, not bank on
the presumptive longevity of their products. In every case the reason growth is threatened, slowed or
stopped is not because the market is saturated. It is because there has been a failure of management. Some
commentators have suggested that its publication marked the beginning of the modern marketing
movement. Its theme is that the vision of most organizations is too constricted by a narrow understanding
of what business they are in.

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 Push and Pull Strategy:
The primary difference between push and pull marketing lies in how consumers are approached. In push
marketing, the idea is to promote products by pushing them onto people. For push marketing, consider
sales displays at your grocery store or a shelf of discounted products. On the other hand, in pull
marketing, the idea is to establish a loyal following and draw consumers to the products.

Push Marketing:
Push marketing is a promotional strategy where businesses attempt to take their products to the
customers. The term push stems from the idea that marketers are attempting to push their products at
consumers. Common sales tactics include trying to sell merchandise directly to customers via company
showrooms and negotiating with retailers to sell their products for them, or set up point-of-sale displays.
Often, these retailers will receive special sales incentives in exchange for this increased visibility.

Businesses often use push marketing when launching a new product, or when trying to stand out in a
niche or crowded market.

Example of Push Marketing:

One common example of push marketing can be seen in department stores that sell fragrance lines. The
manufacturing brand of the fragrance will often offer sales incentives to the department stores for pushing
its products onto customers. This tactic can be especially beneficial for new brands that aren't well-
established or for new lines within a given brand that need additional promotion. After all, for many
consumers, being introduced to the fragrance at the store is their first experience with the product, and
they wouldn't know to ask for it if they didn't know it existed.

Pull Marketing:
Pull marketing takes the opposite approach. The goal of pull marketing is to get the customers to come to
you, hence the term pull, where marketers are attempting to pull customers in. Common sales tactics used
for pull marketing include mass media promotions, word-of-mouth referrals and advertised sales
promotions. From a business perspective, pull marketing attempts to create brand loyalty and keep
customers coming back, whereas push marketing is more concerned with short-term sales.

Businesses generally will use pull marketing when the customer knows what he is looking for or what
problem he needs to solve, but needs pulling towards your solution as opposed to the solution offered by
your competitors.

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Example of Pull Marketing:
You can often recognize pull marketing campaigns by the amount of advertising that's being used. Pull
marketing requires lots of advertising dollars to be spent on making brand and products a household
name. One example includes the marketing of children's toys. In the first stage, the company advertises
the product. Next, the children and parents see the advertisement and want to purchase the toy. As
demand increases, retailers begin scrambling trying to stock the product in their stores. All the while, the
company has successfully pulled customers to them.

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