As noted earlier, exchange is the origin of marketing activity. When people need to exchange goods, they naturally begin a marketing effort.
Evolution of Marketing
As noted earlier, exchange is the
origin of marketing activity. When people need to exchange goods, they
naturally begin a marketing effort. Wroe Alderson, a leading marketing theorist
has pointed out, ‘It seems altogether reasonable to describe the development of
exchange as a great invention which helped to start primitive man on the road
to civilization’. Production is not meaningful until a system of marketing has
been established. An adage goes as: Nothing happens until somebody sells
Although marketing has always
been a part of business, its importance has varied greatly over the years. The
following table identifies five eras in the history of marketing: the
production era, the product era, the sales era, the marketing era and the
relationship marketing era.
In the production era, the
production orientation dominated business philosophy. Indeed business success
was often defined solely in terms of production victories. The focus was on
production and distribution efficiency. The drive to achieve economies of scale
was dominant. The goal was to make the product affordable and available to the
Product era (Quality product)
In the product era, the goal was
to build a better mouse trap and it was assumed that buyers will flock the
seller who does it. However, a better mousetrap is no guarantee of success and
marketing history is full of miserable failures despite better mousetrap
designs. Inventing the greatest new product is not enough. That product must
perceived marketplace need.
Otherwise, even the best-engineered and highest quality product will fail.
Sales era (Pressure selling)
In the sales era, firms attempted
to match their output to the potential number of customers who would want it.
Firms assumed that customers will resist purchasing goods and services not
deemed essential and that the task of selling and advertising is to convince
them to buy. But selling is only one component of marketing.
Marketing era (Satisfied
In this era, the company focus
shifted from products and sales to customers’ needs. The marketing concept, a
crucial change in management philosophy, can be explained best by the shift
from a seller’s market – one with a shortage of goods and services – to a buyer’s
market – one with an abundance of goods and services. The advent of a strong
buyer’s market created the need for a customer orientation. Companies had to
market goods and services, not just produce them. This realization has been
identified as the emergence of the marketing concept. The keyword is customer
orientation. All facets of the organization must contribute first to assessing
and then to satisfying customer needs and wants.
Relationship marketing era (Relationships
The relationship marketing era is
a more recent one. Organization’s carried the marketing era’s customer
orientation one step further by focusing on establishing and maintaining
relationships with both customers and suppliers.
This effort represented a major
shift from the traditional concept of marketing as a simple exchange between
buyer and seller. Relationship marketing, by contrast, involves long-term,
value-added relationships developed over time with customers and suppliers. The
following table summarizes the differences between transaction marketing (i.e.
exchanges characterized by limited communications and little or no on going
relationship between the parties) and relationship marketing.
Activity 1.1.3Make a statement to describe each
of the stages in the evolution of marketing. You may consider the given
examples before coming up with your own statements. 1.
Production era a. ‘Cut
costs. Profits will take care of themselves’ 2.
Product era a. ‘A good
product will sell itself ’ 3.
Sales era a. ‘Selling
is laying the bait for the customer’ 4.
Marketing era a. ‘The
customer is King!’ 5.
Relationship marketing era a. ‘Relationship
with customers determine our firm’s future’
Tags : MARKETING MANAGEMENT - Introduction to Marketing
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