Marketing — Concept, Scope & Management Philosophies

Marketing class 12 NCERT — meaning of marketing, the difference between marketing and selling, the five marketing-management philosophies and the twelve functions of marketing every CBSE Class 12 student must know.

2.1 Where Do Companies Do Their Business? — In the Markets or in the Society?

NCERT opens this chapter with a powerful question: a company's survival does not depend on its consumers alone. A diverse set of stakeholders — the government, religious leaders, social activists, NGOs, the media — also shape the brand. Earning their satisfaction is just as imperative, because they add to the power of the brand by word of mouth. Social concern strengthens the brand. Corporates that have embraced the deepest social values have built powerful brands and, eventually, robust customer relationships.

NCERT groups corporate social justice into two broad categories. The first covers issues that need instant humanitarian attention — child nutrition, child care, old-age homes, fighting hunger, aid to victims of natural calamities. The second covers issues that make society a pleasant place to live in the long run — health awareness and aid, education, environmental protection, women's employment and empowerment, preventing unjust discrimination (caste, community, religion, ethnicity, race, sex), eradication of poverty through employment, preservation of culture, values and ethics, and contribution to research.

2.2 What is Marketing?

The term marketing is described by different people in different ways. Some think it is the same as shopping; whenever they go out to buy something they call it 'marketing'. Others confuse it with selling and feel that marketing starts only after a product has been produced. Still others equate it with merchandising — designing the product. All these descriptions are partly correct, but marketing is a much broader concept.

Traditionally, marketing was described in terms of its activities — the performance of business activities that direct the flow of goods and services from producers to consumers. Most manufacturing firms do not produce for their own consumption but for use by others. To move goods and services from the producer to consumers, a number of activities are required — product designing or merchandising, packaging, warehousing, transportation, branding, selling, advertising and pricing. Together, these are called marketing activities. Thus merchandising, selling and distribution are all parts of a much larger set of activities that a firm performs collectively as marketing^?.

Importantly, marketing is not merely a post-production activity. It also includes activities performed before goods are produced (identifying customer needs, gathering information, designing the product, packaging, branding) and continues even after the goods have been sold (after-sales follow-up to maintain customer relations and procure repeat sales).

2.2.1 Understanding 'Market' — Old and New Meanings

In the traditional sense, the term market refers to the place where buyers and sellers gather to enter into transactions involving the exchange of goods and services. We still use the word this way every day — a cotton market, the gold market, the share market, a national or international market, a consumer or industrial market, a retail or wholesale market.

But in the modern marketing sense, market has a broader meaning. It refers to the set of actual and potential buyers of a product or service. When a fashion designer offers a new dress, all the people who are willing to buy it and offer some value in exchange make up the market for that dress. The market for fans, bicycles, electric bulbs or shampoos similarly means all the actual and potential buyers of those products.

2.2.2 Four Important Features of Marketing

2.3 What Can Be Marketed?

The list of what can be marketed today is far wider than physical goods. NCERT lists eight categories — and modern marketing literature now adds 'experiences', 'properties' and 'organisations' to this list.

2.4 Who is a Marketer?

A marketer is the one who is more active in seeking the exchange. In a typical exchange, one party is more actively looking to make the deal happen — that party is the marketer; the other is the prospect. A seller searching for buyers is a marketer; a buyer searching out a scarce good is also playing a marketer's role at that moment.

A marketer's job in an organisation is to identify the needs of the target customers and to develop products and services that satisfy those needs at a price the customer is ready to pay, made available at a place the customer can access, and communicated through promotion that reaches the customer.

2.5 Marketing Management — Concept

According to the American Management Association, marketing management is "the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organisational goals." Philip Kotler similarly defines it as "the art and science of choosing target markets and getting, keeping and growing customers through creating, delivering and communicating superior customer values of management."

A careful reading reveals three pillars:

2.6 Marketing versus Selling

Many people confuse selling with marketing. Marketing is a much larger set of activities of which selling is just one part. Before a TV is even sold, a TV marketer plans the type and model to be produced, the price at which it will be sold and the distribution outlets through which it will be available. In short, marketing covers a whole range of activities relating to planning, pricing, promoting and distributing products that satisfy customer needs.

Selling, by contrast, is restricted to promoting goods and services through salesmanship, advertising, publicity and short-term incentives — so that the title of the product is transferred from seller to buyer. In other words, selling is about converting the product into cash; marketing is about creating customer value.

2.6.1 Seven Key Differences — Marketing vs Selling

2.7 Marketing Management Philosophies — Five-Stage Evolution

What philosophy or thinking should guide an organisation's marketing efforts? The choice determines the weight given to factors such as product features, selling techniques, customer needs or social concerns. The marketing concept has evolved through five stages.

2.7.1 NCERT Comparison — Five Philosophies Side by Side

2.7.2 The Marketing Concept Rests on Five Pillars

2.8 Functions of Marketing — Twelve Activities of a Marketer

Marketing covers all activities required to move goods and services from producers to consumers in a way that maximises customer satisfaction. From the management point of view, twelve functions are typically performed.