4.1-- marketing

marketing definition

marketing is the management process involved in predicting , identifying and meeting the needs and wants of customers in a profitable manner

2 approaches to marketing

1. product - oriented approach

2. market-oriented approach

product oriented approach definition

• inward-looking and focused on making the product first then trying to sell

• for eg: apple

• business produce innovative products and tempt customers to buy them

market-oriented approach

• outward-looking and focused on carrying out market research first and then making products that can sell

• eg": Coca Cola

• focused on establishing consumer demand so as to supply products that meet consumer needs and wants

find out markets needs and wants via

1. data analysis (analyse data)

2. market research (primary/secondary research)

advantages of market orientated approach

1. reduced risk of failure

2. great flexibility

3. able to meet the challenge of new competitors

reduced risk of failure —market orientated approach

• as a result of market research , firms have increased confidence that their products will sell , reducing risk of failure .

• market research (primary/secondary research) allows firms to understand what consumers want

• 1. Reduced risk of failure
  Market research identifies consumer needs before production → firm produces goods that are more likely to be demanded → higher sales and revenue → reduces likelihood of unsold stock and losses → lower risk of business failure.

greater flexibility —market

firms can respond quickly to changes in the market as they have access to relevant data and information about customers

• Continuous feedback from customers → firm can quickly identify changing tastes and preferences → can adapt product, price, or promotion → remains relevant in dynamic markets → maintains competitiveness over time.

able to meet the challenge of new competitors

• as a result of regular feedback from consumers through market research

• Regular market research → firm is aware of competitors’ actions and consumer reactions → can adjust strategy (e.g., improve product or pricing) → prevents loss of market share → sustains its competitive position.

Disadvantages of market orientated approach

1. costly

2. difficult to meet every consumers needs

3. approach may not work as the future is uncertain

costly — market orientated approach

primary and secondary research might require a middleman/ marketing agent to help go for interviews etc which may be costly

• Primary research (surveys, focus groups) and secondary research → require time, money, and expertise → increases operating costs → may reduce profit margins, especially for small firms → financial strain if returns are low.

difficult to meet every consumer’s needs

due to frequently changing consumer tastes, firms may find it difficult to meet every consumers needs with its available resources

• Consumers have diverse and changing preferences → firm cannot satisfy all segments → risk of over-customisation or confusion in strategy → may dilute brand identity → inefficiency and unclear market positioning.

approach may not work as the future is uncertain

the need for rapid adaptation is not possible in the short run

• Market research is based on current or past data → consumer preferences can change rapidly → firm may react too slowly (especially in short run) → products become outdated → lost opportunities and reduced competitiveness.

Product orientated approach advantages

1. associated with the production of high quality products

2. it can succeed in industries where the speed of change is slow and the firm has already built good reputation

associated with the production of high quality products—product

Focus on innovation and product development → firm invests in design and quality → creates differentiated products → can build strong brand reputation → may charge premium prices → higher profit margins.

1. it can succeed in industries where the speed of change is slow and the firm has already built good reputation

In slow-changing markets → consumer preferences are relatively predictable → firm’s established product is trusted → builds brand loyalty over time → repeat purchases → stable long-term revenue

disadvantages of product oriented approach

• As the needs of the market is ignored the firm takes risks that may lead to eventual business failure or closure 

• Costly and may not yield any promising results (research and development expenses are high)

• As the needs of the market is ignored the firm takes risks that may lead to eventual business failure or closure —product orientated approach

Firm focuses on what it can produce rather than what consumers want → mismatch between product and demand → low sales → excess stock → financial losses and possible business failure.

• Costly and may not yield any promising results (research and development expenses are high)

Heavy spending on research and development → no guarantee product will succeed → if product fails → costs cannot be recovered → wasted investment and reduced profitability.

product orientated approach flow

1. idea

2. production

3. marketing

4. customer

market orientated approach flow

1. customer needs (feedback + reviews)

2. market research

3. production

4. customer

4 important ‘P”

product , price, place, promotion