Basic Concepts of Marketing Management

Definition:

According to Philip Kotler, popularly known as the father of modern marketing, Marketing is "the science and art of exploring, creating, and delivering value to satisfy the needs of a target market at a profit."

"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.'- (Kotler and Keller)”

The American Association of Marketing define marketing management as "the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services in order to create, exchange and satisfy individual and organizational objectives." (Grönroos, 1989). 

Marketing Concepts or Marketing Management Philosophies:

Marketing concepts or marketing management philosophies refer to the philosophies utilized by the businesses to direct their marketing efforts. Mainly, marketing concepts denote the philosophies a business uses to define and accomplish the needs of its customers, serving both the consumer and the company. The same philosophy cannot be helpful for all types of businesses. So, different types of businesses use different marketing management philosophies or marketing concepts.

There are mainly five marketing management philosophies but nowadays a new concept or philosophy is added to the existing ones.

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

Production Concept:

This concept is based on an idea that inexpensive and widely available products generate more sales because customers prefer those. This is quite similar to the Say’s Law which states ‘Supply creates its own demand’. So, companies produce the product on a large scale and make sure that it is easily available everywhere to the customer.

The large scale of production of the product helps the companies to avail the economies of scale which lead to inexpensive products and thus attracting more customers.

The drawback of this concept is that it focuses only on production but not on the product quality which in the long run may cause decreased sales if the product is not up to the mark.

This philosophy is only applicable when the demand exceeds the supply. Again, a customer is not always attracted to an inexpensive product because his/ her purchase decision may be influenced by other factors.

Applicability of this Concept:

• Companies who have a worldwide market for their products may apply this concept.
• Companies enjoying a monopoly advantage may use this concept.
• Any company whose product’s demand exceeds its supply may follow it.

Product Concept:

This concept is based on an idea that customers prefer quality products whatever may be their price and availability. According to this concept, companies concentrate on developing a better quality product which is usually expensive.

The drawback of this concept is that it focuses only on the product quality but not on other factors like usability, availability, price, etc. So, it may fail to attract those customers whose attentions are on the other mentioned factors.

Applicability of this Concept:

• Companies belonging to the technology industry may apply this concept.
• Companies enjoying a monopoly advantage may use this concept.

Selling Concept:

Selling Concept is only concerned with selling the product whatever may be the quality of the product and need of the customer. The chief motive is making money, not developing a relationship with the customers. So, there is less possibility of repeated sales. Companies applying this philosophy can even deceive the customers to sell their products.

The drawback of this concept is that it lacks foresightedness because the companies focus on selling what they produce instead of focusing on the need of the market.

Applicability of this Concept:

• Companies only concerned with short-term profits follow this concept which may lead to marketing myopia, a situation where a company focuses only on selling a product instead of fulfilling customer needs.
• Dishonest or illegal companies may apply this concept.

Marketing Concept:

A company following selling concept cannot have long-term existence in the market because it cannot fulfill customers’ needs. Companies have to make products fulfilling their customers’ needs to be successful in today’s era. So, the marketing concept came into existence. This concept is based on an idea that customers buy the products accomplishing their needs. Companies based on marketing philosophy perform customer-researches to know their needs and wants and make products to meet the same better than their competing companies. In this way, the company builds a customer relationship, becomes profitable and earns goodwill. But still, many companies follow other philosophies and generate profits. The choice of the concept is totally dependent on the demand, supply, and the engaged parties’ needs.

Applicability of this Concept:

• Businesses engaged in perfect competition may follow this concept.
• Businesses who want long-term existence in the market can apply this concept.

Societal Marketing Concept:

The societal marketing concept is based on the marketing concept just adding the philosophy of social welfare with it. Companies concentrate on fulfilling their customers’ needs as well as contributing to social welfare without polluting or affecting the environment and natural resources. According to this concept, company or business being a part of the society has corporate social responsibilities such as eliminating illiteracy, poverty, controlling alarming population growth, ensuring better health and treatment facilities, helping victims of different natural calamities like flood, cyclone, excess cold, draught, etc.

Applicability of this Concept:

• Many big reputed companies like banks, TV channels, telecommunication companies, etc. follow this concept.

Holistic Marketing Concept:

The holistic marketing concept is newly added to the existing marketing management concepts. According to this concept, a business and its different parts are one single entity and have a common goal, aligned and integrated activities to achieve that goal. This concept focuses on meeting customer needs in a better and consistent way as well as performing the social responsibilities.

The holistic marketing concept is very important for brand building, consistency, efficiency, and effectiveness.

Applicability of this Concept:

• Many big reputed companies like banks, TV channels, telecommunication companies, etc. are now applying this concept.

Business people should have a clear and complete idea about the basic concepts of Marketing Management to achieve long-term success.