Prepared by Pramish Shakya Gurukul CA

CHAPTER-2 EVOULUTION OF MARKETING CONCEPTS

Coverage:
1. Evolution of marketing Concepts
a) The production concept
b) The product concept
c) The selling concept
d) The modern marketing concept
e) The societal marketing concept
f) The holistic marketing concept

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 Prepared by Pramish Shakya Gurukul CA

Introduction
Marketing is the system which is associated with the social science. It has evolved along with the
evolution of human thinking and concepts. It is therefore we get multiple definitions of
marketing when we try to learn about it. Few may get confused but the point is that these
definitions were developed according to the understanding of humans towards marketing at
different levels of human evolution.
We understood marketing in different ways during our evolution of market. The market behaved
differently at different stages. So the concept of marketing evolved according to the thinking and
knowledge of humans at different levels of evolution. Like our knowledge and understands have
evolved to the broad level today, the concept of marketing has also evolved accordingly.
People had different concepts towards marketing at different stages. These concepts portray their
understanding of consumers and the market. The market and consumers show different behavior
at different places and different situations. These concepts have evolved according to the
behavior shown by them.

The overall evolution of the concepts of marketing can be defined in following manner:
1. The production concept
2. The product concept
3. The selling concept
4. The marketing concept
5. The societal marketing concept
6. The holistic marketing concept.

1. The production concept

This is the primary concept of marketing. After the industrial revolution, the supply exceeded
demand in the market. This is when the businessmen felt the need for marketing. They had to
have a concept that would help them sell their products in the market other than their
competitors.
This concept explains that consumers prefer those products which are readily available and are
cheaper in price. They had the opinion that given the choice, consumers will prefer cheaper
product over the expensive one. So their main focus was on producing the product at cheaper
cost so that it could be sold in cheaper price. They focused in mass production and mass
distribution to get the benefit of economies of scale. Their concern was to increase their
production efficiency. The marketing was under the production manager whose job was to
increase the production, decrease the price and thus increase the sales.

 Sales elevated through cheaper price

 Mass production and mass distribution to reduce the cost and price through benefits of
economies of scale.
 Production manager was the marketing manager.
 Less or no importance given to the quality of the product.

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Henry Ford in 1909 said, we will provide you the car with the color of your choice but the color
has to be black. This shows that they cared about the mass production of identical products
rather than the taste and preference of the customers.

2. The product concept

The production concept led to the mass production of product with less priority to the quality of
the product. Consumers slowly started to get dissatisfied and reject the product. The sales
decreased. This made the businesses rethink their concept towards marketing. They then came up
with the product concept.
The product concept states that consumers do not always look up to the price of the product.
They look up to the quality of the product. Consumers will prefer better quality products
provided at reasonable price rather than cheaper products with inferior quality.
Thus businesses started to improve the quality of their product. Their main focus was on to
deliver better quality products. Consumers started to respond towards the quality and the sales
increased. Now the marketing responsibility shifted to the product developer from production
manager. The profit was earned through the delivery of better long lasting quality products.
 Consumers prefer quality products over cheaper inferior products.
 Focus on the delivery of better, long lasting quality products at reasonable price.
 No focus in promotion and needs and wants of the consumers.
 Product designer looked after the marketing of the product.

3. The selling concept

This concept focuses on promotion of products. It opines that consumers follow the trend. They
need to be persuaded, lured and motivated to purchase the products. So consumers will purchase
only those products which are known to them, promoted to them and they need to be provoked,
motivated and lured to purchase the product.
However selling concept fails to address consumer’s needs and wants. They focus to sell only
those products which they produce. They follow the philosophy of “we sell what we make”
rather than we sell what the consumers want.
Therefore they focused on promoting the product to the customers. They used hoarding boards,
bill boards, television advertisements, radio jingles, newspaper and magazine prints and many
other promotional tools to lure their customers. The job of the marketing shifted to the product
promoter. They focused on push selling.
 Aggressive selling efforts made to push the product to the customers.
 They were of the opinion that only they can sell the product who can speak louder to the
consumers.
 No effort was given to understand the needs and wants of consumers.
 Quality products offered in reasonable price and aggressively promoted towards the
customers.
 Profit made through high sales volume through push marketing.

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4. The marketing concept

With their failed efforts to raise their desired sales volume through reduced price, better product
in reasonable price and aggressive selling efforts, the businesses started to think differently to
increase their market sales. They then realized that consumers do not only buy the product just
because it is cheap, or of better quality or is aggressively promoted to them, but consumers buy
those things which can actually satisfy their needs and wants. Thus the marketing concept was
developed.
This concept says that consumers will buy those products which have the ability and capacity to
satisfy their needs and wants. The product should be of desired quality with desired specification.
It should be reasonably price and should be available at the right place and at the right time. The
consumers should be informed about the availability of the product.
Thus marketing concept is about earning profit through consumer satisfaction presented through
integrated marketing efforts.
They now say “we make what we can sell” or “we make what is desired by the consumers”.
 It understands consumers and presents them what they want.
 It focuses on customers’ satisfaction through integrated marketing.
 It starts with identifying the unsatisfied needs and wants of consumers and earns profit by
satisfying those needs.
 It focuses in a market niche or target market, understands the customers through customer
orientation, executes integrated marketing and ultimately achieves its goal through
consumer satisfaction.

5. The societal marketing concept

With the rise in the modern marketing concept, businesses dived into the competition of
understanding and finding unsatisfied consumer needs and wants and satisfy them. In this race
they completely ignored the social business ethics. The society became aware of this and started
to reject the unethical business practice. They avoided consuming the products which were
harming or disturbing the society.
This gave birth to the new concept of socio-marketing concept. This concept believes that
consumers are aware of the activities in the market and that they will prefer only those products
which respect and follow social values. They will consume only those products which satisfy
their needs and wants and also respects the society and social rules.
 Consumers do not just consume the product if it satisfies their needs and wants.
 They care about the society and environment. So they consume products which are
socially responsible and environmentally clean and safe.

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6. The holistic marketing concept

Businesses have realized that to survive in this competitive market, it is not enough to follow the
modern marketing concept and be socially responsible. Therefore they have come up with the
latest concept which says that in order to stay on top of the competition; we have to focus on
holistic marketing where the modern marketing concept is accompanied with socially
responsible marketing, integrated marketing and relationship marketing. It is therefore holistic
marketing concept is the combination of three components: modern marketing, integrated
marketing and relationship marketing.
 Just understanding the needs and wants of consumers is not enough to survive in the
market.
 Marketing should be followed by socially responsible marketing, integrated marketing
and relationship marketing.
 Integrated marketing means collective effort of all the units, departments and whole
organization family towards marketing of the product.
 Relationship marketing means creating a bond with the customers and turns them into
loyal customers. They will stay with the organization in every situations and
circumstances as they act as a whole family.

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Exam questions
1. Explain the fundamental principles of societal marketing. (5)
2. Write a note on usefulness of relationship marketing. (5)
3. What is marketing? Explain the selling concept of marketing. (2+3)
4. Differentiate between the production concept and product concept of marketing. (5)
5. What are the ingredients of the marketing concept? Describe in short. (5)
6. What do you know about selling concept of marketing? Explain its features (5)
7. What is marketing? Describe the new marketing concept, societal marketing Concept and
holistic marketing concept in your own words. (3+7)
8. Differentiate between the selling concept and marketing concept. (5)
9. Define marketing. Also explain the societal concept of marketing. (2+3)
10. What is marketing? Explain the selling concept and new marketing concept. (4+6)

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