Updated July 28, 2023
Marketing Concepts Resourceful
Essential Marketing Concepts – Marketing is a process of communicating the value of products and services to customers. It is also the activity associated with buying and selling a product or service, including advertising, selling, and delivering to target customers. People working in the marketing department of a company try to get customer attention through packaging designs, slogans, celebrity endorsements, and media exposure.
The marketing concept involves analyzing customers’ needs so that a company can make informed decisions to meet their needs and bat competition. Most firms today have adopted marketing concepts though this hasn’t always been the case. In his epochal book Wealth of Nations (1776), Eminent economist Adam Smith said that the seller’s needs could be considered only in light of the customer’s demands.
Marketing has evolved over the years, mainly because of changing businesses. Marketing concepts have been adapted and re-adapted to suit present-day needs. Digital marketing has made significant inroads, with e-commerce becoming the norm. But still, some products are not usually sold over the internet, like automobiles and heavy engineering.
How have Marketing concepts evolved?
After the end of World War II, there was an almost deluge of products and services in the market. Customers with a higher disposable income could choose and buy everything to fulfill their needs. In such a scenario, companies were forced to think about what their customers wanted, when they wanted, and how to keep them satisfied. This formed the very basis of marketing concepts.
With the arrival of marketing’s central concepts, the focus of firms shifted from hard selling to identifying customer needs, making decisions to fulfill the requirements, and developing long-term customer relationships by catering to their changing demands. Marketing concepts led to the setting up of separate marketing departments in companies. Many companies have restructured them as marketing firms where each employee contributes towards customer satisfaction, regardless of whether they are marketing personnel.
Marketing’s latest concepts depend entirely on market research which helps identify the segments, size, target market, and customer needs. Then, by using the correct marketing mix, marketing teams make decisions that lead to customer satisfaction.
We will go through seven of the most important marketing concepts that are a mainstay of most businesses today.
1. Needs, wants, and demands
These three are the basic concepts of marketing. Let’s go through them one by one.
- Needs:
Marketing Concepts and marketing key concepts need is a wish or desire that’s psychological, physiological, esteem, security, and actualization. Food, clothing, and shelter are the three basic physiological needs. Security needs arise when you face life’s insecurities that are both man-made and natural. You will want protection from such losses because everybody prefers a risk-free life. And finally, esteem needs a result from competition and jealousy, neither of which can be ignored. If a person eats ordinary cereals, he/she may soon want to switch to a branded product. The status point also comes into question if you drive a standard car and your friend drives an Audi. Like one with silver ornaments, another is thinking of gold; if one travels on a bike, the other may want to travel in a car, and so on.
We then have the self-actualization needs that bring you a unique and unusual status that very few people can enjoy. Not all can become Steve Jobs or Bill Gates, who are rare achievers. Most people battle for physiological needs, fewer safety needs, lesser esteem, and still lesser self-actualization. So that is why we have to know about the Marketing Concepts and marketing key concepts.
- Wants:
A want stems from deficiency. In marketing jargon, wants means need plus the ability to pay. Needs are more than wants. For instance, you will likely have an extra pizza for your family if the second one comes at half the price when you order the first. Wants are chosen from needs. Everybody may say: “I want this, I want that.” Both wants, and needs are countless. But their extent needs to be controlled.
But there are differences between needs and wants. Needs are food, clothing, and shelter. But when the needs are converted to wants, the options multiply. Food may include bread, burgers, mutton, bacon, ham, etc. The shelter could mean a bungalow, cottage, farmhouse, or trailer. Clothing includes shirts, trousers, denim, skirts, wrap-around, hot pants, and many others.
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- Demand:
When a need arises, wants crop up and then follow the demand. It’s a situation where an individual needs a product and the means to pay for it.
While the need is a mere wish, want is a selected need in which a person has genuine interests. Demand, on the other hand, is a clear-cut commitment. An item for need is often a demand for another. So, while a rich man may demand a luxury car, the same will be a mere want for a salaried individual and just a need for a poor person. It exemplifies: “If wishes were horses, beggars would ride.”
2. Marketing offers
The company extends these according to the requirements of the customer. The offer stands for a product or service that caters to the need of the customer regarding quality, quantity, prices, time, regularity, and similar factors. The product could be tangible or intangible. While an actual product is visible and can be detected by our senses, an intangible product is usually a service transferred from the renderer to the receiver at a particular time.
The products could be broadly classified as produced or manufactured. For manufactured goods, both humans role and technology play significant roles. Manufactured products can be consumer durables or non-durables meant for final consumption. Mobile phones, refrigerators, ovens, and cupboards are all durables, while body creams, toothpaste, ready to eat foods are all non-durables.
Each company has a marketing offer comprising a service or product line. The offer usually includes some items from the company’s product line. But sometimes, the entire basket is highlighted in the marketing campaign. A perfect bid meets customer expectations and extends the maximum benefit at a reasonably low price.
3. Marketing Concepts all about Customer value and satisfaction
From the buyer’s perspective, value is the product or service’s capacity from which he/she derives satisfaction. If satisfaction is low, it means that the product or service has low value to the customer. The opposite is also true. Satisfaction is a state of mind and can’t be measured because it’s unquantifiable. The cost concept is very relevant here. And both consumers and sellers are interested in it.
For instance, people usually grab an item given for free or one that’s easily purchasable. The same thing won’t find a similar number of takers if its price is hiked.
Here, you can define the cost to the buyer in monetary terms. Marketing is a significant issue to consider because it requires buyers to let go of alternative options.
4. Exchange, transaction, and relationships
- Exchange:
It lies at the core of marketing. The exchange is the other name for marketing. Manufacturers make all goods needed in society available, attaching due importance to price, quality, time, and place. Products and services must be exchanged for money. Or else there will be a pile-up of inventory affecting the production and distribution mechanism.
For instance, Toyota produces 2,000 cars daily, of which 700 are sold in the US markets, and the rest are exported worldwide. If the sales had not matched the production, the daily output would have to be reduced.
If the seller gives gifts, charity, or donations, it won’t qualify as an exchange. Again, it won’t be an exchange if you take something from your factory, farm, or garden. If you stock goods for sale and then give them to your family and friends free of cost, it’s no exchange.
- Transaction:
It is the deal that takes place between the buyer and seller. The seller has the goods to part with, and the buyer is ready with the money to pay for it. Today, online and card transactions have largely replaced cash exchanges. For many companies, cash transactions are hardly 10% of the total.
Businesses are multiplying today, and more people are buying goods on credit. “Enjoy now, pay late” has replaced “cash and carry.” Thus, buying an apartment, car, or house has become more affordable. Equated monthly installments (EMIs) have arrived as a boon for consumers.
- Relationships:
Mutual trust develops between the buyer and seller over the long term. It’s a customer attraction and detention exercise on the buyer’s part. Once the customers understand that the seller is honest in serving their needs, they will return. They may also spread word-of-mouth publicity, leading to more significant sales.
But an unsatisfied customer, to a seller, is like a rotten mango that rots all others in the basket. That’s why relationship marketing is a specialized field where managers try to win over and maintain customer loyalty.
5. Markets
A market may not necessarily be a place. It’s simply the coming together of buyers and sellers where the former gets detailed information about what the seller offers and what buyers want. It’s a mechanism that enables price fixation for the mutual benefit of both sides. People and goods may not need to be physically present.
Marketing Concepts and key marketing concepts are the starting point because marketing follows it, i.e., goods flow from the seller to the buyer, and money flows in the opposite direction to reach the seller to complete the exchange.
6. Marketers and prospects
- Marketer:
Marketing Concepts and marketing key concepts are an institution or a person engaged in making the products and services available to the customers. He/she may have his/her portfolio of goods that are offered to interested buyers. Marketers create only the place, awareness utility, and time ownership. They do not produce but buy from manufacturers and sell them to customers for further processing or final consumption.
- Prospects:
The counterpart of Marketing Concepts and markets is prospects. Only sellers cannot constitute a market. The presence of prospects leads to the fact of marketers. For a seller, it’s useless if there’s none to buy the products and services.
7. Societal marketing and social responsibility
This concept calls for Marketing Concepts to weave ethical and social considerations into their marketing practice. They must balance conflicting consumer wants, company profits, public relations, and customer satisfaction criteria. Companies have also incorporated corporate social responsibilities in their management practices.
Cause-related marketing concepts have gained ground over the past few decades. Veteran management authors Hamish Pringle and Marjorie Thompson have defined this as “an act by which a company with a product for marketing builds a relationship or partnership with a cause or causes for mutual benefit.”
The concept is based on the belief that buyers usually look for signs like ethical practices and good corporate governance before deciding on brand preferences. It builds a long-lasting relationship with the brand, outlasting rational and emotional benefits. The concept of marketing extends beyond the customer or the company. Marketers must promote social welfare to prosper in the long run.
Final words
We modified the latest key marketing concepts to keep pace with time. As business went on evolving, the marketing concepts altered too. With companies shifting to e-commerce and online businesses, retaining customers has become all the more important.
Here, buyers and sellers do not come face to face. Retaining customers is all the more important under such circumstances. It’s also more difficult because the seller can’t read the customer’s mind. Innovative customer retaining methods have come into effect. These include free replacement of products, round-the-clock customer support, home trials, and many others. But the core concepts remain essentially the same. They are still based on the four Ps of marketing, i.e., product, place, price, and promotion. The last-named is the most critical marketing pillar today.
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