Chapter 11 Principals Of Marketing - Faculty.piercecollege.edu

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11-6 Marketing Strategy [CH 11 marketing concept Organizationwide consumer orientation with the objective of achieving long-run success. developing goods and services to fill those needs have adopted a managerial approach referred to as the marketing concept. The Marketing Concept When people engage in marketing activities, they have consumer needs and desires clearly in mind. Beginning with the Industrial Revolution of the 19th century and the evolved ability to mass produce products, business emphasized production. New manufactured goods were such a novelty, demand was present, and managers concerned themselves with increased production and production efficiency rather than consumer preferences. During this period marketing concerned itself with taking orders and shipping goods. Into the 20th century, manufacturers discovered that their supply was catching up with consumer demand and in some cases an overabundance of goods. Overabundance was especially prevalent after World War I, when European producers could go back to production, and this affected production in the United States. Needing to sell their products where consumers had increasing choices and their demand was declining, business had to change their emphasis from production (as it was mastered) to a sales emphasis. Companies began using sophisticated advertising and sales techniques to increase demand for existing products. The shift from a seller's market to a buyer's market occured in the immediate post-World War II era. Industry shifted from wartime production to consumer goods to meet pent up demand because supplies were directed to war efforts and consumers increased savings. This required a change in the way firms conducted their business. Firms began to develop a consumer orientation and the marketing concept had started to evolve. In the 1950’s, General Electric was one of the first companies to state a policy of customer satisfaction. In its 1952 annual report of that year gave one of the clearest statements of the new approach to focus on customer satisfaction being integrated into each phase of business: (The concept) introduces the marketing man at the beginning rather than at the end of the production cycle, and integrates marketing into each phase of the business. Thus, marketing, through its studies and research, will establish for the engineer, the design and manufacturing man, what the consumer wants in a given product, what price he is willing to pay, and where and when it will be wanted. Marketing will have authority in product planning, production, scheduling, and inventory control, as well as in sales, distribution, and servicing of the product. 2 The policy of customer satisfaction has become known as the marketing concept. The marketing concept can be defined as an organizationwide consumer orientation with the objective of achieving long-run success. Both profit-oriented
CH 11] Business 101 — The Basics 11-7 and nonprofit organizations have adopted the marketing concept as a guide to operating their enterprises. The basic goal is to target all of the organization's efforts by satisfying consumer needs. How did the marketing concept evolve? Originally, most organizations are production oriented; their primary concern is just being able to supply their product or service. This situation is known as a seller's market: one characterized by shortages. Later, as production meets and exceeds buyers needs, a buyer's market evolves; this situation is characterized by adequate or even excess supplies. Marketing is then required to implement the exchange process. Tennant Company, is a 130-year-old floor care equipment manufacturer that started out as a lumber company. They made wood floors, formulated the waxes to be put on the floors and developed mechanized methods to take the old waxes off. As Janet Dolan, CEO, and the 25th woman to head a New York Stock Exchange company says that their “machine, almost like the razor blade and the razor, was really only a vehicle to sell more wax.” The firm's consumer orientation extends to its customer service and promotional strategies. Consumers are encouraged to use a toll-free telephone number to ask questions and suggest product improvements. In this business are there fears of a slowing economy or recession? Of course, nobody likes to do business in a slowing economy. There’s is less cyclical than at any time in the past because of the new segments they ventured into. They engage in more business outside North America, with more business coming from direct service, and after-market. They have become a very responsive company. 3 Marketing in Nonprofit Organizations Adopting the marketing concept has become as important to nonprofit organizations as it has to profit-seeking businesses. Increased competition and cutbacks in government funding prompt many nonprofit groups to conduct marketing research and study consumer behavior. Fund-raising groups such as United Way of America have studied the giving habits of baby boomers, people born between 1946 and 1964, because this group represents a source of significant growth in charitable giving in the next two decades. Research indicates baby Figure 11.4 Organization Marketing Source: Courtesy of the United Performing Arts Fund of Milwaukee, and Kloppenburg, Sitzer & Teich, Inc. seller's market Market situation characterized by shortages. buyer's market Market situation characterized by adequate or even excess supplies.
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Chapter 11 Principals Of Marketing - Faculty.piercecollege.edu

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