Ave Maria College

SENIOR HIGH SCHOOL DEPARTMENT

School ID No. 402686 Gov’t Permit No. 0059 s. 2015
SS ABM G126- PRINCIPLES OF MARKETING

LESSON 1: THE PRINCIPLES OF MARKETING

A. DEFINITION OF MARKETING

Marketing is the activity, set of institutions and processes for creating communicating, delivering, and exchanging
offerings that have value for customers, clients, partners and society.

Marketing is an organizational function because it is a core task that is expected of a modern organization, whether or
not it operates profit. While marketing is now considered as an imperative for commercial enterprises, even non-
commercial sectors benefit from marketing orientation.

Marketing is also a set of processes because there is essential tasks that have to be engaged in order to produce viable
marketing strategy. These tasks shall be outlined as we go along through this course.

Concepts of Marketing

The philosophy of doing business is developed as people realized that marketing is vital to the success of any
marketing organization. The marketing concept emphasizes customer orientation and coordination of
marketing activities to achieve the marketing goals and objectives. The philosophy that “The Customer is the
Boss”, rings over the minds of the marketing people that customer satisfaction which is of paramount
consideration.
1. Marketing must be Customer Oriented
The planning and operation must be directed towards customer orientation. The whole marketing
organization and its operating staff must be focused on determining what will satisfy the needs and wants
of the target customers, the important link in the business operations.
2. Marketing must be Coordinated Activities
Coordination activities must start in the product planning process, the process. The product is the key
element that the customer wants to buy that is worth his money. Price is another important component as
customers would like to get his money’s worth. The place distribution must be within his reach and the
promotional activities must be appealing for him to decide which product to purchase.
3. Marketing must be able to achieve the Performance Target Goals and Objectives.
Customer-oriented and coordinated marketing aims to achieve its profit, objectives and goals. These goals
and objectives hinge on the increase in sales volume and customer’s patronage. Wen product planning,
price, promotion and distribution and properly coordinated, it will result in the most effective way of
satisfying the customer’s needs and wants. The sales volume and profit objective will be realized.

Factors for Developing Marketing Concepts

1. Capturing Marketing Insights

The overall direction must focus on its vision and mission. The organizational goals and objectives must
be directed towards the creation of value to its customers. These must be the inherent philosophy of the
marketing organization. The functional areas in the marketing organization must be focused towards its
ultimate set of tasks in the building of long-lasting relationship with its target market.
2. Effective Financial Management
This system in the procurement of quality and affordable materials for processing of the product is a vital
component in the effective operation of the marketing system. The competition in the market is based on
affordable quality products where labor and materials interplay in their production. Financing the
marketing program will develop effective sales program that will bring in sustainable profitability.
3. The Value of Human Resources
All business activities need human resources in their operation. The employees must be committed in the
production of quality products and the delivery of quality service. They must develop work ethics and
strong commitment to the marketing efforts of the organization. Sustainable development and progress
rest with people who are willing to put all efforts towards the organizational objective of quality products
and service.
4. The Production Process
 The process must conform to standards in terms of product quality. The race to economic profitability is
the production of products that shall satisfy the customer’s wants and needs. The role of marketing is to
sell more products, but it must conform to customer demand. Production may produce so many products,
yet they are useless inventory when they fail to reach their target market. Marketing efforts will turn them
into profitable inventory.
5. The Presence of Competitors
The marketing of products becomes interesting with the presence of competitors. Marketing outfit must
develop strategies in capturing their target market and develop and sustained patronage. These marketing
strategies must develop customer loyalty to the brand or the product.

Several Distinct Traditional Approaches

1. Production concept focuses in the internal potentials of the company and not based on the desires and
needs of the market.
2. Marketing concept a philosophy which states that organization must try hard to find out and satisfy the
needs and wants of consumers while at the same time accomplishing the organizational goals.
3. Sales concept refers to the idea that people will buy more goods and services through personal selling
and advertising done aggressively to push them in the market.
4. Relationship concept/marketing an approach that centers on maintaining and improving value-added
long-term relationships with current customers, distributors, dealers and suppliers.
5. Societal Marketing Concept views that organizations must satisfy the needs of consumers in a manner
that gives for society’s benefit.

The Goals of Marketing and their Social Effects

1. Maximize the Consumption of Goods

The Aggressive marketing strategies and policies had increased the consumption of goods and services.
The demand of the market is tremendous. Sellers face many challenges on what products to offer. Buyers
want quality products at reasonable price and it the most convenient location. The marketing job is to
stimulate greater product consumption. Greater production requires consumption of material inputs and
more goods in the market that create more employment.
2. Maximize Consumer Satisfaction
The market demand is varied, and customer satisfaction is the challenge of the marketing organization.
Measurement of customer satisfaction is difficult. It embraces careful analysis of the market demand
which varies with the time and the social development of society.
3. Maximize Choice of Goods or Service
Some marketers believe that the goals of marketing are to maximize the variety of the product in the
market and provide consumers a wide assortment of choices. The main objective is for customers to find
the goods that will satisfy their biological needs as well as their emotional and social wants.
4. Maximize the Quality of Life
The improvement of the quality of life is that the target of marketing people. New hand phones are
created to communicate with various sectors of society, friends and families. Easy communication access
satisfies not only social needs but also business requirements. Computers and other electronic gadgets
bring pleasures to homes and enjoyment of the comfort of living.

Goals of Marketing

1. Focusing on customer wants and needs to distinguish products from competition.

2. Integrating all the organization’s activities to satisfy customer wants and needs.
3. Achieving the organization’s long-term goals by satisfying customer wants and needs

B. MARKETING IS IMPORTANT TO BUSINESS

The fundamental objectives of most businesses are survival, profit and growth. Marketing contributes directly to
achieving these objectives. Marketing includes the following activities, which are vital to business organizations:
assessing the wants and satisfactions of present and potential customers, designing and managing product offerings,
determining price and pricing policies, developing distribution strategies, and communicating with present and potential
customers.
 All businesspeople, regardless of specialization of area of responsibility, need to be familiar with the terminology and
fundamentals of accounting, finance, management and marketing. People in all business areas need to be able to
communicate with specialists in other areas. Furthermore, marketing is not just a job done by people in marketing
department. Marketing is a part of the job that everyone in the organization. Therefore, a basic understanding of marketing
is important to all businesspeople.

MARKETING AFFECTS YOUR

LIFE EVERYDAY Describe several reasons for studying marketing
Marketing plays a major role in Why Study Marketing?
your everyday life. You participate in
the marketing process as a consumer of
goods and services. About half of every
peso you spend pays for marketing
costs, such as marketing research,
product development, packaging,
transportation, storage, advertising and Important
sales expenses. By developing a better to society Important Good career
understanding of marketing, you will to business opportunities
become a better-informed consumer.
You will better understand the buying
process and be able to negotiate more
effectively with seller. Moreover, you
will be better prepared to demand
satisfaction when goods and services
you buy do not meet the standards
promised by manufacturer or the
marketer.
C. MARKETING MANAGEMENT PHILOSOPHIES

Four competing philosophies strongly influence an organization’s marketing processes. These philosophies are commonly
referred to as production, sales, market, and societal marketing orientations.

Product Orientation

A product orientation is a philosophy that focuses on the internal capabilities of the firm rather than on the desires and
needs of the marketplace. A production orientation means that management assesses its resources and asks these
questions: “What can we do best?” “What can our engineers design?” “What is easy to produce, given our equipment?” In
the case of a service organization, managers ask, “What services are most convenient for the firm to offer?” and “Where
do our talents lie?” Some have referred to this orientation as a Field of Dreams orientation, from the movie’s well-known
line, “If we build it, they will come.” The furniture industry in famous for its disregard of customers and for its slow cycle
times this has always been a production-oriented industry.

Sales Orientation

A sales orientation is based on the ideas that people will buy more goods and services if aggressive sales techniques are
used and that high sales result in high profits. Not only are sales to the final buyer emphasized but intermediaries are also
encouraged to push manufacturer’s products more aggressively. To sales-oriented firms, marketing means selling things
and collecting money.

The fundamental problem with a sales orientation, as with a production orientation is lack of understanding of the needs
and wants of the market place. Sales-Oriented companies often find that, despite the quality of their sales force, they
cannot convince people to buy goods and services that are neither wanted nor needed.

Market Orientation

The marketing concept is a simple and intuitively appealing in philosophy that articulates a market orientation. It states
that the social and economic justification for an organization’s existence is the satisfaction of customer wants and needs
while meeting organizational objectives. It is based on an understanding that a sale does not depend on an aggressive sales
force, but rather on a customer’s decision to purchase a product. What a business thinks it produces is not of primary
importance to its success. Instead, what customers think they are buying-the perceived value- defines a business the
marketing concept includes the following:
  Focusing on customer wants and needs so that the organization can distinguish its product(s) from competitors
offerings
 Integrating all the organization’s activities including production, to satisfy these wants
 Achieving long-term goals for the organization by satisfying customer wants and needs legally and responsibly.

Social Marketing Orientation

The social marketing orientation extends the marketing concept by acknowledging that some products that customers
want may not really be in their best interest or the best interest of society as a whole. This philosophy, states that an
organization exists not only to satisfy customer wants and needs and to meet organizational objectives but also to preserve
or enhance individuals’ and society’s long-term best interests.

Marketing products and containers that are less toxic than normal, are more durable, contain reusable materials, or are
made of recyclable materials is consistent with a societal marketing orientation.

Activity 1: Concept Map

1. Begin by writing the central idea or concept in the center of the page. In this case, it's "Marketing."
2. Identify the key concepts and sub-concepts related to marketing. These might include:
 Definition of Marketing
 Promotion
 Sales
 Customer Satisfaction
 Market Research
3. Arrange your concepts hierarchically. The central idea, "Marketing," should be at the center, and the sub-
concepts should radiate out from it.
4. Use lines or arrows to connect related concepts and show how they are interlinked. For instance, connect
"Promotion" and "Sales" to illustrate that they are closely related components of marketing.
5. Under each concept or sub-concept, provide concise definitions or explanations to clarify their meaning. For
example: