Nature and Scope of Marketing

Nature and Scope of Marketing

Introduction

·       Marketing is both a philosophy (customer orientation) and a process (activities of creating, communicating, delivering, and exchanging offerings).

·       It deals with identifying customer needs, creating value, and building long-term relationships for organizational growth.

·       Traditional view: Marketing was seen as selling and distribution of goods.

·       Modern view: Marketing is a customer-centered process of identifying needs and satisfying them profitably.

·       Philip Kotler: “Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others.”

Market – Features, Concept, Types

(A) Meaning

·       A market refers to a place or mechanism where buyers and sellers interact to exchange goods, services, or ideas.

·       In modern sense, it does not always mean a physical location; online platforms are also markets.

(B) Features of a Market

1. Two parties – Buyers and sellers.
2. Exchange – Transfer of goods/services for value (money/barter).
3. Demand and supply – Buyers create demand; sellers create supply.
4. Competition – Existence of alternatives.
5. Medium of communication – May be physical (bazaar) or virtual (e-commerce).

(C) Concept of Market

• Place concept → A physical place where exchange occurs.
• Commodity concept → Market defined by a product (e.g., wheat market).
• Space concept → Geographical area covered.
• Demand-based concept → Potential customers form a market.
• Modern concept → “Market is people with needs, purchasing power, and willingness to buy.”

(D) Types of Market

1. Based on area: Local, national, international, global.
2. Based on nature of goods: Consumer goods, industrial goods.
3. Based on transaction: Spot market, future market.
4. Based on competition: Perfect competition, monopoly, oligopoly, monopolistic competition.
5. Based on medium: Traditional (physical) market, digital/e-market.

Marketing – Definition, Features, Importance, Scope/Functions

(A) Definitions

• American Marketing Association (AMA): “Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.”

(B) Features of Marketing

1. Customer orientation – Focus on consumer needs.
2. Value creation – Deliver superior value.
3. Exchange process – Involves transfer of goods/services for value.
4. Dynamic process – Continuously adapts to environment.
5. Integrated approach – Coordination of product, price, place, promotion.
6. Profit & social responsibility – Balances profit with customer satisfaction.

(C) Importance of Marketing

• For consumers: Availability of products, better quality, satisfaction.
• For business: Revenue generation, brand building, competitive advantage.
• For economy: Employment creation, market expansion, economic growth.
• For society: Improves standard of living, fulfills wants, encourages innovation.

(D) Scope / Functions of Marketing

1. Market research – Identifying needs and market trends.
2. Product planning & development – Designing products for consumer satisfaction.
3. Standardization & grading – Ensuring quality and uniformity.
4. Packaging & labeling – Protecting and promoting the product.
5. Pricing – Setting appropriate prices for target market.
6. Promotion – Advertising, sales promotion, personal selling, PR.
7. Distribution – Channels of distribution, logistics, warehousing.
8. Sales management – Managing sales force and strategies.
9. Customer service & relationship – After-sales service, loyalty programs.
10. Financing & risk-taking – Credit facilities, managing risks in marketing.

Approaches to Marketing

1. Production Approach (late 19th century)
• Focus: Mass production, economies of scale.
• Assumption: Consumers prefer affordable, available products.
• Limitation: Ignores quality and changing consumer preferences.
2. Product Approach
• Focus: Product quality, features, innovation.
• Assumption: “A good product sells itself.”
• Limitation: Neglects consumer needs, overemphasis on technology.
3. Selling Approach
• Focus: Aggressive sales, promotion, persuasion.
• Assumption: Consumers must be convinced to buy.
• Limitation: Short-term, ignores customer satisfaction.
4. Marketing Approach (Modern)
• Focus: Identifying and satisfying customer needs.
• “Customer is the king.”
• Builds long-term relationships.
5. Societal Marketing Approach
• Focus: Balancing company profits, consumer satisfaction, and societal welfare.
• Example: Eco-friendly packaging, CSR initiatives.
6. Holistic Marketing Approach
• Recognizes that marketing is a broad, integrated process.
• Includes relationship marketing, integrated marketing, internal marketing, and socially responsible marketing.

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