What is a Marketing Concept? - Definition & Examples

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  • 0:00 A Pizza Shop
  • 0:45 Marketing vs.…
  • 1:35 Types of Marketing Concepts
  • 5:35 Lesson Summary
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Lesson Transcript
Instructor: Ashley Johns

Ashley has taught college business courses and has a master's degree in management.

One of the biggest challenges for businesses today is attracting customers and keeping them. They do so through effective marketing. This lesson will identify five different approaches to marketing philosophies and provide examples for each.

A Pizza Shop

Let's imagine that you want to open a pizza shop. You live in a suburban area with lots of families, so you know that the potential market is good. You've got some savings with which to start your business, and soon, you are the proud owner of a little shop in the center of your town. We'll call it Pizza Pizzazz.

Fast-forward three months. Your shop is still open, but with each month, your savings are dwindling because you are not yet making enough profit from your small business to cover all the expenses. You knew it usually takes about six months to get a business off the ground, but now that the shop has hit its stride, you have some time to devote to the question at hand: How can you best market Pizza Pizzazz to bring in new business and generate a profit?

Marketing vs. Marketing Concepts

Marketing is the promotion of business products or services to a target audience. It is, in short, an action taken to bring attention to a business' offerings; they can be physical goods for sale or services offered. Common examples of marketing at work include television commercials, billboards on the side of the road, and magazine advertisements.

But not all businesses approach the need to market their goods and services the same way. In fact, there are a few different approaches to how marketing can be successful for an organization. These approaches are called marketing concepts, or a philosophy that determines what type of marketing tools are used by a company. Marketing concepts are driven by a clear objective that takes into account cost efficiency, social responsibilities, and effectiveness within a particular market.

Types of Marketing Concepts

There are five distinct marketing concepts, or five different approaches to how effective marketing is achieved by a company. Not all five philosophies will work in all industries, as you will see. The concepts are defined below by the driving philosophy behind them; we will identify a company's primary belief about their target audience and how they use that information to their benefit.

Production Concept

Companies that utilize the production concept believe that, first and foremost, consumers want products that are easily accessible and inexpensive. The production concept thrives on the ability to increase output while decreasing costs.

Companies that manufacture their products overseas are a perfect example of the production concept in action. Manufacturing retail goods offshore decreases costs, savings they can pass on to the customer. Lower prices can be a mighty incentive for attracting new customers. Unfortunately, the company may see a decrease in quality, and eventually a decrease in sales if the process is not kept up to standards.

Product Concept

Businesses that have invested in the product concept opine that the most important priority for consumers is quality within a product. This means customers are looking for innovative options and continuously seeking out the best of what is currently available.

Many companies within the technology industry utilize the product concept. These companies are constantly updating and releasing new products. It is important for tech firms to make strong decisions on how often to release new products. Releasing too often can leave customers frustrated that there were very few changes. Not releasing updates often enough can leave customers feeling that the company is out of date. Companies must review the needs of the customer and implement those changes as quickly and efficiently as possible.

Selling Concept

The selling concept assumes that consumers are looking for aggressive sales and promotions from companies. Many times, marketing tactics driven by the selling concept are based off the company's need to sell rather than consumers' need to purchase. The selling philosophy can be seen with clearance sales on items such as vacuum cleaners and life insurance. It may not be a needed purchase, but a consumer can be persuaded with strong marketing or advertising techniques.

Marketing Concept

The next philosophy might be a bit confusing, since it shares its name with our overall focus for this lesson. To differentiate, we'll call this one marketing concept/approach, in which companies believe that consumers want to see the products meet their wants and needs more than the competition. There is a lot of comparison shopping.

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