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Marketing Oriented Approach - Essay Example

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Marketing Oriented Approach

To this end it is useful to compare and contrast between firms that lie at two ends of the spectrum: the marketing oriented firms versus the production oriented. A marketing oriented approach is a ‘reactive’ approach in that companies produce new products/services based on customer needs and wants (Kotler, 2007). However, it goes further than that in that it aims to establish long term profitable relationships with the customer (Jeff, 2009). The aim of such firms is not just delivering a product has profitable customer demand but also establishing long term association with them by exceptional customer service. Such service may be in the form of superior after sales service and/or consultation services provided by salespeople (Jeff, 2009). Kotler elaborates on the concept of marketing orientation by claiming that holistic marketing orientation is essentially a process that enables companies to capture customer lifetime value. The concept of building long lasting relationships with customers enhances the company’s ability to understand the customer and retain him for a lifetime. Thus, the Pareto rule that 20% customers bring in 80% of the revenue is very well recognized by this approach which aims at capturing a customer and retaining him for life. Companies that therefore drifted away from the idea of offering low prices towards offering a brand experience. Today’s customer is no longer price conscious; infact, contemporary trends have made the customer of today pressed for time with multiple claims on an individual’s scarce time. Hence, convenience and satisfaction is the need of the hour. Thus, rather than competing on cost, companies today are competing on attempts to provide a pleasurable brand experience to its customers. On the other hand, the production oriented approach is a ‘proactive’ approach in that the company first produces the product/service that is most feasible for the company in terms of its competitive priorities (cost, quality, delivery, flexibility) and then makes an effort to sell it to the customers. Thus, production oriented firms are inclined towards mass production of goods that they are able to produce at the lowest cost due of economies of scale (Jeff, 2009). Perhaps, an obvious difference then is that companies adopting marketing oriented approach are able to offer differentiated, innovative and unique products as opposed to production oriented firms that offer standardized, low cost items at several locations (Jeff, 2009). Hence, the fundamental difference between the two is that in the former the ‘customer’ is the driving force behind a new product whereas in the latter, the ‘company’ is the driving force. Furthermore, in production oriented companies the role of the sales force also changes; from that of prior consultation to ‘pushing’ the product to the customer once it’s produced (Jeff, 2009). Hence, the marketing oriented companies adopt what is known as a ‘pull’ strategy (that is having the customer buy the product he/she wants) as opposed to the ‘push’ strategy of production oriented firms (that push the product it develops based on low costs to the customer) (Kotler, 2007). Although both have successfully co-existed since a long time, it has been realized that most successful ...Show more

Summary

The dynamic business environment caused by phenomenon such as mergers and acquisitions, globalization, free trade, shorter product lifecycles, rapid economic growth as well as technological advancements have all exerted significant pressure on the top management’s ability to proactively deal with the changes and respond to them as quickly as possible (Kumar et al., 2011)…
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Marketing Oriented Approach essay example
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