Module No.

Marketing Concepts and Principles

Learning Competencies

Define and understand marketing:

• Principles

• Goals

• Approaches

Learning Content

After going through this module, you are expected to achieve:

1. Define and understand marketing, concepts and principles;

2. Understand the goals of marketing and its social effects; and

3. Discuss the goals of marketing

Learning Content
Assessment

1. Interactive Class Discussion

2. Written Work / Activity
3. Review / Recap Recitation
Marketing Concept

Marketing is the creation and communication of value to customers. It involves

the customer’s maintenance of relationships that should last for lifetime. It is
the link between society’s material requirements for its needs and wants.
Marketing must satisfy human needs and wants through the exchange process
and the building of long-term relationships.

Figure 1. Concept and Marketing Principles

Over the years, marketing has evolved various definition and its meaning
changes according to the views of the different marketing gurus. Many view
marketing as process or dynamic business activity that is designed to plan and
promote the delivery or satisfy needs and wants of the potential and present
market. In the definition of marketing given by the American Marketing
Association or AMA, “Marketing is an organizational function and a
set of processes for creating, communicating, and delivering value to customers
and for managing customer relationships in ways that benefit the
organization and its stakeholders.” The definition views as an exchange
process or discipline that involves strategies, activities, positions, and
institutions.

The definition of Marketing according to Dr. Philip Kotler, “A social and

managerial process whereby individuals and groups obtain what they need
and want through creating and exchanging products and value with
others.” It is also defined as the meeting of the minds between the seller
and the buyer to satisfy human needs and wants with profit on the part of the
marketer and the satisfaction of thee buyer for the money he spent. On the
bases of this view, marketing is an organization intervention and functions that
set the process of creating, communicating and delivering value to customers.
From the academic point of view, marketing is the art and science of creating
tangible products or services and finding the market, getting and retaining
them to attain profitable operations. On one hand, it is a societal process
that marketers must communicate the sustainable value of the product
or service to its target market. It is a critical business process for
attracting customers to satisfy their needs and wants.

Marketing is also an integrated process through which companies create value

for customers and build strong customer relationships in order to capture
value from customers in return. Simply put: Marketing is the delivery of
customer satisfaction at a profit.

Goal: Attract new customer by promising superior value and keep

and grow current customers by delivering satisfaction.

The company and its market are equally important. It is marketing that gives
fulfilment to both components. Marketing people should balance between
the company’s requirements for profit and desired market share.

This is composed of two other interacting components: the customer and

competition. The overriding objective of the company is not just to satisfy the
needs and want of its customer. It must profitable and better than its
competitor. Otherwise, the competitor could win the customers because it is
able to satisfy them.

Customer Needs and Wants

Figure 2. Concept of Marketing
Need is one important component in the marketing of products. It is the
consumer’s desire for a product or service. The product or service must have
specific benefits that satisfy the functional or emotional needs. On the other
hand, basic needs are food, clothing, and shelter. We cannot live without them
and marketers must be able to provide them to human population.

Food can be processed in different tastes; styles and menus that shall
meet the human craving and satisfaction. Clothing could be designed into
different styles depending on people’s taste and social values. Shelters are
constructed differently depending on the capacity of the buyer to finance his
home. These needs are the marketer’s point of interest for profit.

Wants are higher-level human needs as they appeal more to the emotions.
These are the social needs for recognition and the development of higher social
satisfaction is limitless. The development of technology and different electronic
gadgets are more of human wants. The marketers must continuously
improve technological inventions to sustain customer wants.

Concepts of Marketing

According to Garovillas (2004), he stated that the marketing concept is a

business philosophy, which holds that the key to achieving organizational goals
consists of determining the needs and wants of target markets and delivering
the satisfaction more effectively and efficiently than competitors do.

The philosophy of doing business is developed as people realized that

marketing is vital to the success of any marketing organization. The
marketing concept emphasizes customer orientation and coordination of
marketing activities to achieve the marketing goals and objectives. The
philosophy that “The customer is the boss”, rings over the minds of the
marketing people that customer satisfaction which is of paramount
consideration. While it is important to satisfy customer wants and
needs, this could only be achieved under the following marketing
concepts.

1. Marketing must be Customer Oriented. The planning and operation must be

directed towards customer orientation. The whole marketing organization
and its operating staff must be focused on determining what will
satisfy the needs and wants of the target customers, the important link in the
business operation.

2. Marketing must be Coordinated Activities Coordination activities must start

in the product planning process, the process. The product is the key element
that the customer wants to buy that is worth his money. Price is another
important component as customers would like to get his money’s worth. The
place of distribution must be within his reach and the promotional
activities must be appealing for him to decide which product to purchase.

3. Marketing must be able to achieve the Performance Target Goals and

Objectives. Customer-oriented and coordinated marketing aims to achieve its
profit, objectives and goals. These goals and objectives hinge on the increase in
sales volume and customer’s patronage. When product planning, price,
promotion and distribution and properly coordinated, it will result in the most
effective way of satisfying the customer’s needs and wants. The sales
volume and profit objective will be realized.

Factors for Developing Marketing Concepts

1. Capturing Marketing Insights
The overall direction must focus on its vison and mission. The
organizational goals and objectives must be directed towards the creation of
value to its customers. These must be the inherent philosophy of the marketing
organization. The functional areas in the marketing organization must be
focused towards its ultimate set of tasks in the building of long-lasting
relationship with its target market

2. Effective Financial Management System

This system in the procurement of quality and affordable materials for
processing of the product is a vital component in effective operation of the
marketing system. The competition in the market is based on affordable quality
products where labor and materials interplay in their production. Financing
the marketing program will develop effective sales program that will bring in
sustainable profitability.

3. The Value of Human Resources

All business activities need human resources in their operation. The employees
must be committed in the production of quality products and the delivery of
quality service. They must develop work ethics and strong commitment to the
marketing efforts of the organization. Sustainable development and progress
rest with people who are willing to put all efforts towards the organizational
objective of quality products and services.

4. The Production Process

The process must conform to standards in terms of product quality. The race to
economic profitability is the production of products that shall satisfy the
customer’s wants and needs. The role of marketing is to sell more products,
but it must conform to customer demand. Production may produce so many
products, yet they are useless inventory when they fail to reach their target
market. Marketing efforts will turn them into profitable inventory.

5. The Presence of Competitors

The marketing of products becomes interesting with the presence of
competitors. Marketing outfit must develop strategies in capturing their target
market and develop and sustained patronage. These marketing strategies must
develop customer loyalty to the brand or the product. Product improvement
and pricing strategies with sustained promotional and
advertising program are important components in the competitive market

Traditional concept marketing is a marketing strategy a company uses to

determine if it can produce a viable product consumer want or need, whether
the company can produce enough products to fill the need, and the marketing
method by which the need can be filled.

Several Distinct Traditional Approaches:

1. Production concept focuses on the internal potentials of the company and

not based on the desires and needs of the market.

2. Marketing concept a philosophy which states that organization must try

hard to find and out and satisfy the needs and wants of consumers while
at the same time ccomplishing the organizational goals.

3. Sales concept refers to the idea that people will buy more goods and services
through personal selling and advertising done aggressively to push them in
the market.

4. Relationship concept/marketing an approach that centers on maintaining

and improving value-added long-term relationships with current customers,
distributors, dealers ,and suppliers.

5. Societal Marketing Concept views that organizations must satisfy the needs
of consumers in a manner that gives for society’s benefit.

The Goals of Marketing and their Social Effects

1. Maximize the Consumption of Goods

The Aggressive marketing strategies and policies had increased the

consumption of goods and services. The demand of the market is tremendous.
Sellers face many challenges on what products to offer. Buyers want quality
products at reasonable price and t the most convenient location. The marketing
job is to stimulate greater product consumption. Greater production requithe
res consumption of material inputs and more goods in the market that create
more employment. More jobs are created, and more people enjoy economic
wealth. Maximum consumptions generate economic development for the
nation.

2. Maximize Consumer Satisfaction

The market demand is varied, and customer satisfaction is the

challenge of the marketing organization. Measurement of customer
satisfaction is difficult. It embraces careful analysis of the market demand
which varies with the time and the social development of society.

The customer may be satisfied with the product the marketing people produce
but it may create pollution to the environment. Plastics are good packaging
materials for consumer goods but they create flood and environmental
pollution. Cars and other vehicles using gasserve the convenience of the riding
public, but they create global warming that result to environmental
imbalance.

3. Maximize Choice of Goods or Service - Some marketers believe

that the goal of marketing is to maximize the variety of the product in the
market and provide consumers a wide assortment of choices. The main
objective is for customers to find the goods that will satisfy their biological
needs as well as their emotional and social wants. Development of new
products needs research but that will mean time and costs. Maximizing
consumer choice entails cost as the economies of scale do not operate in
production of goods. The consumers must spend time studying the benefits of
the production of goods.

4. Maximize the Quality of Life - The improvement of the quality of life is the
target of marketing people. New hand phones are created to communicate with
various sectors of society, friends and families. Easy communications access
satisfies not only social needs but also business requirements. Computerss
and others electronic gadgets bring pleasures to homes and enjoyment of the
comfort of living. The quality of life is difficult to measure. Life satisfaction is
more than the physical comfort. The impact of electronic radiation has created
health problems among the many users of modern gadgets. People in the
previous generations lived longer because they lived a simple life. They ate
unadulterated food and lived free from pollution and radiation.

Goals of Marketing
1. Focusing on customer wants and needs to distinguish products from
competition
2. Integrating all the organization’s activities to satisfy customer wants and
needs
3. Achieving the organization’s long-term goals by satisfying customer wants
and needs
KEY PERFORMANCE INDICATORS

Key performance indicators (KPIs) are used to check that the

marketing activities of a company are on track. KPIs are specific metrics
which are used to track performance to make sure the firm is on track to meet
specific objectives. They are sometimes known as performance drivers or
critical success factors for this reason.

Examples of noteworthy marketing goals:

1. Identifying the target market
2. Increasing sales and profits
3. Increasing brand awareness
4. Increasing market share
5. Countering competitive strategies
6. Reputation
7. Increasing distribution channels

What is Traditional Marketing?

Traditional marketing is an umbrella term that covers the wide array of

advertising channels we see daily. These may include print media, billboard
and TV advertising, flyer and poster campaigns and radio broadcast
advertising. These traditional marketing messages are not necessarily
outdated, however, research has shown those companies that have abandoned
simply using these channels, and adopted contemporary marketing channels
proposed in this article, have remained prosperous and in fact seen an increase
in leads, a higher quality of leads, sales and traffic to web content.
Ansoff's Matrix Theory

Traditional marketing theories include Ansoff's Matrix, a theory that

opposes products/services fall into one of four categories depending on the
market and the product released. New Product- New Market is considered
as diversification. This try recommends that businesses should try to
diversify their product portfolio t read risk amongst their product range. An
example of this would be when Apple created the first iPhone released in 2007.
This product was new and introduced into a new market. Apple soon reaped
the benefits of introducing this hugely popular phone. Their product range
grew from accommodating for designers on the Apple Mac, to mobile
devices, tablet vices, watches and beyond.

The Marketing Mix

Another marketing theory that's considered to be traditional is the marketing

mix. made up of the 7 P's. These include product, place, promotion, price,
packaging and positioning. All these components, when combined, create a
solid marketing proposal. However, this theory as well as Ansoff's, can be
drastically improved with the use of contemporary marketing strategies.

Traditional Marketing seeks to pull customers to a product, whatever the

cost. It is, for this reason, considered to be outdated as it does not consider the
customer they are selling to, more the market that the company operates
within. There are however channels that have developed from traditional
marketing, including digital, that aim for the same goal, however, use more
subtle and approachable mediums so as to capture their target audience. This
may include Pay-Per-Click campaigns, social media posts, search engine
optimization and email marketing.

DEFINITION OF CONTEMPORARY MARKETING

Simply defined, contemporary marketing refers to marketing strategies that are
consumer focused. Contemporary marketing strategy offers products and
services based on what the target market desires rather than what the
company wants them to have, thereby, offering greater support for their
customers and becoming able to take advantage of more advanced
marketing funnels to track progress.

DIFFERENCE BETWEEN CONTEMPORARY MARKETING

ORIENTATION AND TRADITIONAL MARKETING ORIENTATION

The main difference between the contemporary marketing orientation

and traditional marketing orientation is that while the former is consumer-
focused, the latter is company-focused. Traditional marketing is
concerned with pulling customers and does not really consider the
customer's diverse needs. Rather it is concerned with the market or industry in
which the company operates in.

Contemporary marketing aims for customers satisfaction in order to build a

relationship with them. Therefore, the types of marketing strategies
under contemporary marketing are concerned with the needs of customers.

Since it first emerged as a distinct business and management phenomenon,

marketing has evolved significantly with new types of marketing to address
changing trends in the market. This is probably because most successful
businesses use a combination of different types of marketing whether they’re
contemporary or traditional marketing strategies to get great results.
Business owners now see more reasons to get the best out of the
functions of marketing by enhancing their target marketing plan example to
deliver more developmental benefits. The diversity and improvement in
marketing nowadays could sometimes prompt one to wonder what marketing is
meant to look like.

Our contemporary marketing world now features advanced marketing skills

and an improved marketing mix. Here are some of types of marketing:

1. Business to Business - B2B Marketing

2. Business to Consumer - B2C Marketing

3. Brand Marketing

4. Cloud Marketing

5. Telemarketing

6. Guerrilla Marketing

7. Push Marketing

8. Influencer Marketing

Emerging Types of Marketing and their Applications:

Based on a 2017 report by Kleiner Perkins Caulfield and Byers, an internet

trend investment firm, 3.4 billion people use the internet. Therefore, the
internet has become an easy and quick way to research, reach and engage
customers.

1. Search engine optimization is majorly concerned with increasing a

business’ visibility and rankings on search engine result pages. It is a simple
way of attracting organic traffic of potential customers to a website. SEO can be
maximized with paid

adverts (Google AdWords), strategic content marketing and social media

networks.

2. Pay per Click advertising: This is advertising presented on search

engine result pages or web pages where the advertiser is only charged based
on the number of times someone clicks on the ads to go to the advertiser's
targeted website.

3. Email marketing is a type of marketing based on the

distribution of messages through emails. Email marketing provides direct
contact with customers and allows businesses to create relationships with their
customers. Updates, exciting news, and call to actions can be sent directly to
customers.

4. Referral marketing: is a type of marketing where an individual or customer

pleased with the results gotten from a product refers the product to another
person. It's a very subtle form of marketing that can provide great results
especially when the person referring is an Influencer in that industry.

5. Affiliate marketing: is a prominent type of internet marketing where a third

party promotes a product and earns commission, or a piece of the profit gotten
from every sale made through that referral.

6. Video marketing: Videos act as one of the most interactive types of online
marketing and can prove to be a great way to raise awareness about a business
or product. In fact, according to Mushroom networks, YouTube is the second
biggest search engine. Therefore, video marketing can prove to be a great way
to pass messages to target customers.

7. Inbound marketing is a very powerful contemporary marketing strategy that

focuses on different tactics to draw consumers in and convince them to buy
goods. It is one the result-oriented types of marketing that uses content to
drive results. A key subset of Inbound marketing is Content marketing
which the Content Marketing Institute refers to as "a strategic
marketing approach focused on creating and distributing valuable,
relevant, and consistent content to attract and retain a clearly
defined audience."
Green marketing refers to the process of selling products and/or services
based on their environmental benefits. Company are selling products and/or
services by first promoting its benefit that is environmentally friendly or
produced in an environmentally friendly way.

For green marketing to be effective, there are three things that needs to be
done:

1. Being genuine
a. The company is doing what it claims to be doing in its green marketing
campaign and;
b. The rest of the business policies are consistent with whatever the firm is
doing that’s environmentally friendly.

2. Educating the customers isn’t just a matter of letting people know that the
company is doing whatever it doing to protect the environment, but also a
matter of letting them know why it matters.

3. Giving customers an opportunity to participate means personalizing the

benefits of the company’s environmentally friendly actions, normally
through letting the customer take part in positive environmental action
Self-Evaluation

Activity 1:

Essay:
Assume you are about to graduate. How would you apply marketing principles
to your job search? In what ways would you be able to market
yourself and impress the human resource specialists create,
communicate, and deliver value as a potential employee, and what would that
value be, exactly? How would you prove that you can deliver that value?

Activity No. 2

Instructions: Watch the video. Online marketing vs traditional

marketing then write the difference between traditional versus online
marketing for Product, Price, Place and Promotion.
https://www.youtube.com/watch?v=d4aijRJFOq4&t=9s

Activity No. 3