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A Brief History of Modern Marketing: Marshallian Economics
A Brief History of Modern Marketing: Marshallian Economics
Understanding human behavior — how people think and make decisions — can be illuminating
for marketers. Studying consumer behavior can provide professional marketers with the
knowledge they need to develop effective communications that motivate people to purchase
goods and services.
Prior to the mid-20th century, businesses promoting their goods and services focused little
attention on the individual behavior of their customers. Instead, their strategies focused on mass
promotion. This involved impersonal campaigns that aggressively tried to convince consumers
to make purchases. They were less focused on customer satisfaction with goods and services.
These tactics ultimately proved ineffective.
In the early 1950s, marketers began to recognize the benefits of selling to customers already
inclined to buy certain products. This discovery led to a shift in focus, with marketers examining
the specific details of who their customers were and what they needed and desired.
Marshallian Economics
Alfred Marshall was an economist who believed that consumers buy their goods and services
based on what offers the most personal satisfaction. Some have criticized this theory for being
uninformative. (It is assumed that people buy what they like, if they can afford it.) However, the
theory has given marketers several useful hypotheses. Some include:
Psychoanalytic Theory
Psychoanalytic theory traces back to Sigmund Freud, the Austrian founder of psychoanalysis.
Although he himself was not concerned with consumer behavior, his theories of human behavior
were revolutionary. He believed that humans are not able to fully understand their own
motivations because the psychological factors that shape them are largely unconscious. A
major part of the unconscious mind is comprised of strong urges and desires. Since these
desires can cause significant guilt and shame when they surface, people will repress them.
Pavlovian Theory
This theory comes from the work of Russian psychologist Ivan Pavlov. In a famous experiment,
Pavlov discovered that if he rang a bell immediately prior to feeding a dog, he could eventually
get the dog to salivate just by ringing it. He concluded that much of human behavior results from
conditioned responses.
The Pavlovian theory can prove highly useful for marketers. When establishing or reinventing a
brand, marketers can use this knowledge to help create or change consumer habits, or reinforce
brand elements that are associated with positive customer experiences.
In keeping with the Veblenian model, for example, they are beginning to understand that our
face-paced, technology-saturated culture means that consumers are placing an even higher
value on their time. Marketers must find ways to make their advertisements both shorter and
more impactful, according to Direct Marketing News (DMN). Other examples of changing
consumer values include: decreasing tolerance for marketers who abuse personal data, rising
expectations for interaction with brands and the desire to build long-term relationships with
companies. The American Marketing Association adds that in order to move forward, marketing
experts must begin to collect consumer data in far more intentional ways and increase their
focus on advertising to a diverse, global audience.
The science of consumer behavior is always evolving, characterized by constant change and
refinement. For those seeking to find their place at the forefront of the marketing profession,
Husson University offers an online BSBA with a marketing concentration. The fully online
program takes just one to two years to complete, giving students a fast track to achieving their
career goals.
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