05 Jul
Marketing
Exchange or Barter
At the heart of marketing lies the concept of exchange, which refers to the process of fulfilling desires and needs through trading, buying, or exchanging goods and services.
Traditional Marketing Concept
American Marketing Association
The American Marketing Association defines marketing as: “Marketing is the organizational function and set of processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.”
Marketing is the process by which individuals and organizations obtain what they need and want by creating and exchanging value with others. It involves the planning and execution of the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives. To better understand the concept of marketing, it's essential to grasp the core concepts that form its foundation: product, need, demand, desire, consumer, customer, commercial customer, sales and marketing, competition, value, and satisfaction.
The place where the exchange happens is the market. From a marketing perspective, a “market” is defined as a group of people who have needs to satisfy, the means to spend, and the willingness to spend. Effective marketing largely depends on understanding the market well, its characteristics, and its size. Markets can also be classified from an economic perspective, considering the roles of buyers, the power of buyers and sellers, and other factors.
- The concept of marketing as we know it today began to take shape with the emergence of mass production economies.
- Both in ancient times and today, marketing involves a social and managerial process by which individuals and groups obtain what they need and want by creating and exchanging products and values with others. (Kotler - 1998)
- One of the primary objectives of marketing is to facilitate exchanges that satisfy customers.
The Evolution of Marketing
Marketing, which began with bartering, evolved into a concept based on mass production economies.
- In the early 19th century, the production-oriented approach was prevalent. This approach focused on the product to be manufactured, and business management was based on the idea that consumers would show interest in a product offered at an appropriate price. Thus, businesses aimed to produce goods as cheaply as possible.
- During periods of high demand, marketing was not very important for the production-oriented approach, and sales activities were generally considered a function of production.
- The second phase was the sales phase; after the Great Depression of 1929 - 1930, selling products became a significant concern for American businesses. Increasing competition made selling more challenging, leading companies to engage in marketing activities. During this period, it became evident that without activities to increase sales, products would not be sufficiently purchased.
- By the 1950s - 1960s, the marketing concept began to gain importance. As a new business philosophy, the marketing concept differed from the sales approach that focused on the seller's desires. Instead, it centered on the buyer's desires. In this period, the consumer and their needs became more important.
- From the 1960s onwards, marketing activities were influenced by the marketing mix and marketing management. During this period, the traditional marketing approach focused on consumer products and target markets, aiming to achieve the optimal marketing mix.
- Before reaching modern marketing, marketing went through three phases: production/product, sales, and marketing.
- In this period, marketing became a separate function within the organizational structure of businesses, effective from pre-production to post-sale activities. Today, the current phase is based on the concept of social marketing. Marketing and advertising activities now extend to the point of even sending cars into space.
- This approach considers not just the short-term desires and needs of consumers but also long-term objectives on an individual and societal basis. Issues like environmental pollution, raw material shortages, inflation, and inadequate social services are prioritized over consumer desires.
- In traditional marketing, the primary goal is to sell to as many people as possible and maximize profit. Therefore, customer behavior, characteristics, and purchase history are not given much importance. In traditional marketing approaches before the emergence of the new marketing concept, the customer was often neglected and placed in the background.
- Factors Influencing Changes in Marketing
- These factors can be examined under three main headings:
- Technological advancements and the widespread use of the internet
- Globalization
- Increase in consumer education and communication levels
- In the new marketing approach, businesses have functions such as collecting, storing, processing, and distributing data about customers with the help of technology. Businesses use the information they gather in databases to identify customer segments, segment them, and determine which marketing strategies to use for which customer groups.
- Although it is generally accepted and practiced in traditional marketing, new marketing mix components are being added to the literature because it does not respond to evolving needs.
- With the development of technology, globalization, and the increase in consumer education and awareness levels, some changes have occurred in marketing. As a result of these changes, the definition of marketing, the marketing mix, its role, and the organizational structure of businesses have also changed. This process has developed relationship marketing; it has led to the consumer being placed at the center of the business, the development of the concepts of creating and delivering value, and the emphasis on market orientation.
- Basic Terms in Marketing Language
- Market; the place where goods are sold, in other words, where buyers and sellers come together and the exchange of products and services takes place.
- Buyer; individuals and institutions with a specific need and the financial means and willingness to meet that need.
- The concept of consumer can be examined by dividing it according to the use and location of the purchased products:
- Those who buy for their own or their family's needs are final consumers,
- Those who buy products for economic reasons such as using them in production, adding new values to the product, or reselling them are industrial consumers.
- The place where exchanges related to marketing take place is called the market. In markets, exchanges are made based on the desires and needs of the consumer.
- Desires and Needs
- Humans have entirely physical needs:
- Water
- Air
- Internal Energy: Energy obtained from what we eat
- External Energy: Energy received from the sun
- Sleep
- Reproduction
- Communication
- Needs, desires, and wishes beyond basic physical needs vary: peace, freedom, belief, hope, friendship, human touch, love, respect, self-expression, education, reading, sports, art, community life, etc.
- While most changes in the field of marketing are related to money, the underlying reasons are experience, emotion, psychological, and sociological factors.
Marketing 4.0
- Study the needs and wants of consumers,
- Produce products to meet those needs and wants,
- Offer these products at certain prices,
- Ensure they are delivered to specific locations through various distribution channels,
- Prepare promotion and communication programs to create awareness, recognition, and interest in the products.
The 4P's of Marketing = Marketing Mix
The 4P’s are symbolized as product, place, price, and promotion.
The intersection point seen as People explains today's marketing understanding. The 5th P has always existed, but according to the postmodern marketing approach, without the 5th P, the 4P’s are not very significant.
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