WEEK 1

Lesson 1. An Overview of Marketing

I. Lesson Objectives

As you read and study this chapter, concentrate on the following objectives, and
at the end of the chapter, be able to:

1. Discuss the meaning of the word marketing;

2. Explain the marketing strategy and the marketing concepts; and
3. Understand the marketing mix.

II. Read and Learn

Developments in the economic activities of people led to the adaption of new

ways of satisfying human needs and wants. Consumption becomes the primary concern
of economies and as a result, production became first priority undertaking. Satisfying
wants, however, turned out to be more complex than it was thought to be.

The "free enterprise" feature of our economy provides sufficient incentives to

individuals and groups of individuals to participate in the quest for making products and
services available to consumers and industrial users.

Making goods, however, is one thing; making sure that they are bought is
another. To facilitate the implementation of the latter, a new tool was invented which
came to be known later as marketing.

WHAT IS MARKETING

A review of literature exposes the development of marketing from "the

transportation of goods from the point of production to the consumers" to the more
complicated "satisfying needs and wants”.

The development of the marketing concept may be attributed largely due to the
desire of firms to be strongly competitive.
 Marketing may be defined as exchange activities conducted by individuals or
organizations for the purpose of satisfying human wants with the view of accomplishing
individual or organizational objectives.

Definition of Basic Marketing Terms

For a clear understanding of marketing, some basic terms need to be defined.

Exchange. This term refers to the trade of things or service of value between
buyer and seller. Exchange happens when for example, a person gives Ten thousand
pesos (P10, 000) to another person who, in turn, gives the former a cell phone.

Human Needs. This term refers to thing or service that is required by a human
being for the health and well-being of his body and mind. A person, for example, has a
need for water medical services.

Human Want. When a person has an unfulfilled need, and he is aware of an

object that will best satisfy the need, and the object is still not in his possession, the
person has an existing human want.

Objective. The desired result of an activity is called objective. An example of

objective is profit which is desired by the business person. Another example is the
reduction of pollution which is desired by nature lovers and health enthusiasts.

THE MARKETING CONCEPT

The real objective of the business firm is to make profits on a short-term and
long-term bases. Experience has proven, however, this is possible only when the
customers patronize the firm. Long-term customer patronage is preferred by the firm but
it can only happen as a consequence of customer satisfaction. The customer will be
satisfied only if the product or service he buys is really the one he wants, at a price
acceptable to him, at the place where he wants to find it, and at the way he wants to get
it.

The marketing concept calls for identifying the needs of customers first before
any move is made. It is wise to know what is in the mind of the customers before
starting any production activity. When customers’ needs and wants are identified, the
company has a greater chance of achieving its goals.

The Marketing Concept versus the Other Concepts

Even in modern times, not all business firms are expected to adapt a single
concept even if it is tried and tested. A brief description of the various concepts are
presented below.

1. The product concept. Companies adapting this concept attempt to find interested
buyers after producing the product.
2. The selling concept. Under this concept, the firm produces the product then adapts
a selling strategy designed to convince a group of perceived customers.
3. The marketing concept. Under this concept, the firm defines its target market and
determine the needs, wants, and values of the market. The firm adapts a strategy to
satisfy those needs and wants more effectively and efficiently than its competitors.

The marketing concept is not an instant discovery. It came as a result of

developments in the desire of sellers to provide goods and services to customers. The
various stages of development and the approximate years when they happened are
briefly described below:

1. The production era. When some groups of people started to produce goods not
only to satisfy themselves but also other people, the first stage is set in the ultimate
development of the marketing concept. This era covers the period of the Industrial
Revolution until 1928.
2. The sales era. The company emphasized selling because of increased in
competition in this era covering the period 1930 to 1950.
3. The marketing department era. During the period covering 1950 to 1960,
progressive companies adapted the idea that all marketing activities within the firm
must be under the control of a single department.
4. The marketing company era. During the period 1960 to 1975, marketing was
recognized as the concern not only of a single department but of the whole
 company. That was also the time when marketing people developed long-range
plans.
5. Marketing company with social concern era. At about the year 1975, companies
began to consider social issues as a factor in the formulation of marketing strategies.

Superiority of the Marketing Concept

The marketing concept has been prove to be more effective and efficient than the
other known concepts. Unless a better concept is invented, it will continue to be so.

The product-oriented and the selling oriented firms will find it hard to reach the
sales level of marketing-oriented companies which gathers information to determine the
following:

1. What products or services are expected by the customers?

2. At what price are the customers willing to buy such products or services?
3. At what place do they expect to find the products or services they want?
4. What kind of promotion will likely persuade them to buy?

If the firm knows the answers to these question, it well be in a better position to
achieve its marketing objectives.

MARKETING STRATEGY AND THE MARKETING CONCEPTS

In the effort to make profits, the formulation of a strategy is necessary. To attain a

certain level of sales, the adaptation of a marketing strategy is required. After identifying
the target market, the firm will have to gather answers to the four questions on what the
target market wants. Most often, the firm will decide on satisfying only a portion of what
the target market wants. A marketing strategy, then will be crafted to achieve that goal.

WHEN DOES MARKETING OCCUR

For marketing to occur, four factors are necessary:

1. The presence of at least two parties with unsatisfied needs;

2. The desire and ability of the parties to be satisfied;
3. The existence of a way for parties to communicate; and
4. Each party has something to exchange.

THE MARKETING VARIABLES

In and out of the firm, there are factors that the firm must reckon within in its
attempt to achieve its marketing objective. These are regarded as “variables” because
they are apt to change, are changeable, or irregular. The variables are of two types:

1. The marketing mix variables; and

2. The marketing environment variables.

The Marketing Mix

The marketing mix variables are parts of the internal environment the firm
created and as such, the firm can directly manipulate them in pursuance of a sound
marketing strategy. The mix may consists of the following variables: (1) the product, (2)
the price, (3) the promotion, and (4) the place.

The product. The tangible commodity or the intangible service that the business
firm offers for sale to prospective customer is referred to as “the product”. It includes the
warranties and other conditions attached to the product.

The price. The amount of money paid by the customer to the selling firm so the
customer can use the product is called “the price”. The price is set to attract prospective
customers to buy. Considerations regarding retail and wholesale prices, discounts and
allowance, and credit terms must be taken care of.

The promotion. The provision of required information to prospective customers so

that they are persuaded to buy is called promotion. It involves any or all of the following
types: personal selling, mass selling, and sales promotion.

a. Personal selling involves the use of the services of salesmen to influence the
buyer's purchasing decision. This approach requires face-to-face contact between
the firm's salesman and the prospective customer.
b. Mass selling involves the simultaneous persuading of large numbers of prospects
to buy the company's products. In contrast with personal selling, the firm's products
are presented on a non-personal basis. When mass selling is in paid form, it is
called advertising; when in unpaid form, it is called publicity.
c. Sales promotion refers to promotion activities other than personal selling,
advertising and publicity. It is a short-term inducement of value offered to
prospective customers to arouse interest in buying a good or service. Coupons,
raffle stubs, and tree samples are some of the ways used in sales promotion.

The Place. When the firm wants to emphasize the place variable, it makes the
company's products available in the location and time required by buyers. The channel
of distribution helps implement the firm's concern about the place variable. In reality, the
link between the seller and the buyer is the channel of distribution.
 Name:___________________________________

Activity 1

ESSAY:

1. Choose any product/service that you know of, then explain how you are going to
market the product/service that you have chosen.

2. Differentiate Product Concept, Selling Concept and Marketing Concept.

3. Among the marketing mix variables, which one do you think is the most
important? Explain your answer

Specific Instruction:

1. Write in a yellow pad of paper

2. Minimum of 200 words each essay