Marketing may be defined as the process of assessing consumer needs, wants, preferences and demand; designing and producing goods and services that will satisfy such wants and moving such gods and services to the final consumer at a profit to an organisation.
Importance of Marketing to the Economy
- It encourages mass- production which leads to lower unit cost of goods and services
- It promotes competition and efficiency
- It improves the standard of living of people by making modern goods available to them
- It creates employment opportunities for the practitioners
- It ensures consumers satisfaction
- It increases productivity (GDP) and is the key to economic growth
Functions of Marketing
- Exchange function
- Buying function
- Selling function
- Storage function
- Transportation function
- Financing function
- Risk bearing function
- Pricing function
- Standardizing and grading of goods
- Market information and research
- Production planning and development
- Determining the level of production
EVALUATION QUESTIONS
- What is Marketing
- Explain five functions of marketing
MARKETING CONCEPT
This is a principle which states that a business merely exists to satisfy the needs (and wants) of its customers. Therefore all marketing activities are geared towards (or aimed at) identifying the needs of consumers, designing and producing goods to satisfy these needs while at the same time meeting the goals of the organization (i.e. maximization of profits).
A company adopts marketing concept when all its efforts are directed towards meeting the needs and aspirations of the consumers.
Marketing concept includes:
- Identifying the needs of consumers
- Development of products to suit these needs
- Planning and organizing programmes to bring the product to the consumers
- Carrying out post sales activities that will ensure that the products are satisfactory in use.
MARKETING MIX
This refers to the combination of FOUR controllable variables employed by a business enterprise to set up its marketing policy which has the aim of satisfying the needs of the consumers and to increase the sale of the goods.
The four variables are usually called the 4P’s i.e.
- Product
- Price
- Promotion
- Place
- Product Mix: This is a concerned with developing the right product for the target market. It involves decision taken by the firm about packaging, labeling, branding, trade marks, designs, modifications, durability and quality of their products.
- Price Mix: This relates to the placing of the right, profitable and justifiable price on a particular product that will suit the customers and at the same time fetch higher revenue to the manufacturer. The components of price mix are discounts, credit terms, allowances, margins, mark-up, freight etc.
- Promotion Mix: This involves the procedure employed by a business to let the public know about their products and services. The various forms of production that the firm can use include:
- Personal Selling
- Sales Promotion
- Advertising
- Publicity
- Public Relations
- Place Mix: This relates to all the activities carried outin the movement of goods and services to the consumers. It involves how the producer distributes his goods to the consumers at the right market (place), time, quantity and quality.
DEFINITION OF MARKETING TERMS
- Consumer Sovereignty: This concept assumes that consumers are always right. It is also known as the supremacy of the consumer in determining what a firm has to produce. Therefore, the planning and operations of the organisation must be consumer-oriented i.e. having the consumer in mind while planning.
- Market Research: This is the study conducted by a firm and aimed at determining consumers demand and guide the firm in its production and marketing activities.
- Market Segmentation: This relates to grouping consumers based on their purchasing habits. It helps in defining target markets.
- Consumer orientation: This is the concept of marketing which begins and ends with the needs and wants of the consumers rather than that of the organisation. Consumer satisfaction is the major aim of this concept.
EVALUATION QUESTIONS
- What is marketing concept?
- Explain the four elements of the marketing mix
- Differentiate between marketing and a market
- Explain the meaning of the term “Market Segmentation”.
GENERAL EVALUATION QUESTIONS
- State three uses of capital as a factor of production
- State four uses of land as a factor of production
- State five features of a partnership business
- Explain five reasons why government participate in business
- State five advantages of a public limited company
READING ASSIGNMENT
Essential Commerce for SSS by O.A. Longe Page 292 – 306
WEEKEND ASSIGNMENT
- The general idea of “looking at a business but using the consumer as the mirror” illustrates (a) marketing concept (b) market orientation (c) consumer research (d) product orientation
- To know precisely how consumers react to a product, a manufacturer should (a) make a feasibility study (b) take stock control (c) undertake a marketing research (d) product
- Which of the following is not part of the four P’s of marketing (a) place (b) publicity (c) promotion (d) product
- Marketing concept means (a) selling goods directly to consumers (b) introducing new product into the market (c) emphasizing consumer’s satisfaction (d) persuading customers to buy more
- Combination of methods used by a firm for marketing its products is known as (a) market research (b) marketing mix (c) marketing concept (d) market segmentation
THEORY
- Define the term ‘marketing mix’
- List four components of the marketing mix