Progressive business firms have adopted a â€œmarketing concept philosophyâ€ which guides marketing managers is fulfilling their responsibilities. Briefly defined, the marketing concepts says that a company will prosper only as long as it gives consumers products that satisfy their needs and wants at prices that are willing to pay at a profit to the company. Thus, marketing begins and ends with consumer satisfaction.
The key elements of the marketing concept are:
1. Customer orientation: A thorough understanding of the consumerâ€™s needs and wants becomes the focal point of all marketing action, especially product planning and development.
2. Integrated effort: The firmâ€™s primary emphasis must be in integrating the marketing functions with those of R & D, production, finance, and so forth.
3. Profitability: The primary goal of the firm should be profits; sales volume should only a proxy measures for satisfactory marketing performance in the short-run. Non-profit organizations should establish well defined and measurable goals for evaluating success of marketing efforts.
4. Viability: The Company and its long run survival and growth are paramount since the idea is to promote consumer loyalty.
Theodore Levitt delineated a philosophy by identifying what he referred to as â€œmarketing myopiaâ€. Essentially, it involves having a narrow, engineering concept of a product. For example, railroads conceived their product to be rail transport instead of the broader view that it was the product people movement service. Likewise, banks are not merely institutions for the lending or storage of money; they are full service retailers who serve the financial needs of individuals, families, small businesses, financial ands estate planners, meet off-hour cash needs by the 24 hour computerized teller, and so forth.
Planning is the most important function of the marketing manager because it guides all subsequent actions or decisions. The strategic plan is developed at the corporate or highest level in the firm. It reflects the basic missions of the firm and specifies the long run general marketing goals and / or objectives of the firm; it time frame is anywhere between one to five years. A strategic plan is likely to include such things as growth opportunities, profit goals, market shares, channel arrangements, product-line developments, and environmental.
In the short run the marketing manager develops an operating plan generally called a marketing program. The marketing program usually limited to a year, tells what is to be done, when it is to be done, and who is to be responsible for each activity of function. The marketing program often referred to as the marketing mix generally focuses on the following four areas: product, pricing promotion, and channels of distribution. The vital elements of the program are policies, strategies, and tactics.
While policies may be defined differently from firm to firm, the essential element in a policy is â€œdirectionâ€. Marketing policies involve a group of relative principles and consequent rules of actions which are designed to promote the successful achievement of marketing objectives. A marketing program will have established policies in each element of the marketing mix. For example, a common pricing policy states that â€œextraordinaryâ€ price discounts must comply with antitrust laws and be cleared by the legal department. However, it must be understood that each marketing activity will be governed by a set of interrelated policies. In the case of products, there will be policy statements relating to such matters as service (pre-sale and post-sale), warranty, and inventory of parts, returns, physical distribution, deletions, and so forth. It should be noted that policies are flexible and may be altered during a current year if warranted by competitions or changes in current business conditions.