Marketing refers to activities undertaken by a company to promote the buying or selling of a product or service. Marketing includes advertising, selling, and delivering products to consumers or other businesses. Some marketing is done by affiliates on behalf of a company.
Marketing as a discipline involves all the actions a company undertakes to draw in customers and maintain relationships with them. Networking with potential or past clients is part of the work too, including writing thank you emails, playing golf with a prospective client, returning calls and emails quickly, and meeting with clients for coffee or a meal.
At its most basic, marketing seeks to match a company's products and services to customers who want access to those products. The matching of product to customer ultimately ensures profitability.
How Marketing Works
Product, price, place, and promotion are the four Ps of marketing. The Four Ps collectively make up the essential mix a company needs to market a product or service. Neil Borden popularized the idea of the marketing mix and the concept of the Four Ps in the 1950s.
Product refers to an item or items the business plans to offer to customers. The product should seek to fulfill an absence in the market, or fulfill consumer demand for a greater amount of a product already available. Before they can prepare an appropriate campaign, marketers need to understand what product is being sold, how it stands out from its competitors, whether the product can also be paired with a secondary product and whether there are substitute products in the market.
Price refers to how much the company will sell the product for. When establishing a price, companies must give considerations to the unit cost price, marketing costs and distribution expenses. Companies must also consider the price of competing products in the marketplace and whether their proposed price point is sufficient to represent a reasonable alternative for consumers.
Place refers to the distribution of the product. Key considerations include whether the company will sell the product through a physical storefront, online, or through both distribution channels. When it's sold in a storefront, what kind of product placement does it get? When it's sold online, what kind of digital product placement of sorts does it get?
Promotion, the fourth P, refers to the integrated marketing communications campaign. Promotion includes a variety of activities such as advertising, selling, sales promotions, public relations, direct marketing, sponsorship, and gurella marketing.
Promotions will vary depending on what stage of the product life cycle the product is in. Marketers understand that consumers associate a product’s price and distribution with its quality, and they take this into account when devising the overall marketing strategy.
The five marketing concepts
The five marketing concepts are:
Let’s take a closer look at each one.
The production concept
When the production concept was defined, a production oriented business dominated the market. This was from the beginning of capitalism to the mid 1950’s.
During the era of the production concept, businesses were concerned primarily with production, manufacturing, and efficiency issues.Companies that use the production concept have the belief that customers primarily want products that are affordable and accessible.
The production concept is based on the approach that a company can increase supply as it decreases its costs.Moreover, the production concept highlights that a business can lower costs via mass production.
A company oriented towards production believes in economies of scale (decreased production cost per unit), wherein mass production can decrease cost and maximize profits. As a whole, the production concept is oriented towards operations.
The product concept
This concept works on an assumption that customers prefer products of greater quality and price and availability doesn’t influence their purchase decision. And so company develops a product of greater quality which usually turns out to be expensive.
One of the best modern examples would be IT companies, who are always improving and updating their products, to differentiate themselves from the competition.Since the main focus of the marketers is the product quality, they often lose or fail to appeal to customers whose demands are driven by other factors like price, availability, usability, etc.
The selling concept
Production and product concept both focus on production but selling concept focuses on making an actual sale of the product.Selling concept focuses on making every possible sale of the product, regardless of the quality of the product or the need of the customer.
The selling concept highlights that customers would buy a company’s products only if the company were to sell these products aggressively.This philosophy doesn’t include building relations with the customers. This means that repeated sales are rare, and customer satisfaction is not great.
The marketing concept
A company that believes in the marketing concept places the consumer at the center of the organization. All activities are geared towards the consumer.A business,aims to understand the needs and wants of a customer. It executes the marketing strategy according to market research beginning from product conception to sales.
By focusing on the needs and wants of a target market, a company can deliver more value than its competitors. The marketing concept emphasizes the “pull strategy” This means that a brand is so strong that customers would always prefer your brand to others’.
The societal marketing concept
This is a relatively new marketing concept. While the societal marketing concept highlights the needs and wants of a target market and the delivery of better value than its competitors, it also emphasizes the importance of the well-being of customers and society as a whole (consumer welfare or societal welfare).
The societal marketing concept calls upon marketers to build social and ethical considerations into their marketing practices. They must balance and juggle the often conflicting criteria of company profits, consumer want satisfaction, and public interest.
The five marketing concepts are a good example of how marketing has changed throughout the years. It has shifted its focus from products to users.
Modern companies have to put users first, and build not only a good product (or service), but also a good experience around it.If you need help with creating marketing strategy, contact us today and we’ll be glad to help you.