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Title: Explain the major differences between the Production, Product, Selling and Marketing concepts.
In marketing there are five different concepts that different companies and businesses use. These are the production concept, product concept, selling concept, marketing concept and the societal marketing concept. Every company or business can decide what concept they would use, but sometimes companies decide to get the best of 2 concepts.
The production concept is the idea that people would favour products that are available all the time and/or are cheap and therefore highly affordable. This concept was used during the 19th century when it was thought that people would buy anything, if it was cheap and if an item was at a low price people were prepared to accept poor quality. Today this is the idea behind the Euro chain shops, like ‘Tal-Lira’, ‘Eurocity’ or ‘Conimex’, where objects are cheap but not of the best quality available on the maltese market. The focus in the production concept is the quantity and the cheap price.
This concept came to practice after the industrial revolution when factories where built and products started being mass produced so the price of the products became much cheaper than the products that were made by hand. A good example of this is Henry Ford who started to produce black model T-cars in the 1900’s, these cars were being mass produced in a factory and therefore all the same shape and colour. This made them cheaper and people could now afford them. A disadvantage of this concept is that products are of poor quality and products are not unique because the products are mass produced in a factory and so everything is the same.
Due to the Industrial revolution people started to work and have more income, so people were prepared to pay that extra cost to have something that fit’s their own needs. This is where the product concept comes in. The product concept is the idea that people will favour products with the best quality, performance and features. Since not everyone has the same needs, it was decided that an “ideal product” could be made. So products where produced with a lot of features so that a lot of people’s needs can be satisfied. For an example many features on a washing machine or the different features on a TV remote controller are rarely used. This may also be considered to be a disadvantage, because many features are not necessary to some people and so they are made to pay a high price for a feature they will in fact not use and sometimes could even be a drawback for them.
The focus of the product concept is quality. Many companies like Microsoft are always releasing better products, by arranging any previous defects that the previous product could have had. When talking about the product concept we have to mention Product myopia which is a risk to the companies, product myopia is when the company or business focuses on the short term attractions of the product and not the long term benefits so when a new product comes out the ‘older’ product is not used anymore, an example of this is the typewriter and the ‘film’ cameras which where run over by computers and digital cameras respectively.
The selling concept is the idea that if customers are left to buy a product they would not make the effort unless a large scale selling and promotional effort is undertook. The focus in the selling concept is on selling the products by the use of adverts and promotions and there is no focus on the customer. Due to this there is no long-term relationship between the customer and the seller but only a transaction. The advantage of this concept to the company is that products are sold. This concept is useful when this product is unsought, for example; insurance that is not obligatory by law, blood donation or cemetery plots, or also when a product is probably only bought once in, for example; double-glazed windows or liquid membrane.
The marketing concept focuses on the needs and wants of the ‘Target market’ (people they are targeting to sell to, for example mobile for older people with larger keys and less confusing functions). This concept is based on the costumer and so is the best concept of the four mentioned so far because it specifically meets the needs and wants of the customers. An advantage of this concept to the company is that a long-term relationship is formed with the customer and therefore there is a high customer lifetime value (CLV), so more profit is made. But also a disadvantage to the company is that this concept is pro-active and is expensive in terms of time and money in the short term but the end result should be worth it.
Although the marketing concept is accepted as being better than the other concepts in terms of business performance, the other concepts could be used in certain situations. A concept that is better than the marketing concept is the societal marketing concept. This concept makes marketing decisions by considering customers wants and needs, organizational goals and society’s long-term interest.