CHAPTER – 6
MARKETING MANAGEMENT
CONCEPTS, TYPES AND FUNCTIONS
STRUCTURE
6.0 Introduction
6.1 The concept of market
6.2 The classification of market
6.3 The meaning of marketing
6.4 The evolution of the marketing concept
6.5 Distinction between marketing concept and
selling concept
6.6 The objectives of marketing
6.7 The functions of marketing
6.8 Concept and Importance of Marketing Mix
6.9 Model Questions
6.0 INTRODUCTION :
In an industrial economy, production has no meaning unless the products are exchanged
for money or money’s worth. The success of any business depends on its ability to effect
a fruitful exchange of its products or services among its customers. Marketing is the key
to that success. Efficient marketing management is a pre-requisite for the successful
operation of any business. A business organization has many functional areas of operation
like finance, production, human resource management, research and development,
purchasing, marketing and the like. Marketing occupies an important position in the running
,126 BUSINESS STUDIES AND MANAGEMENT, CLASS-XII
of a business. Marketing is an exciting, dynamic and contemporary field. It influences us
every day in both our roles as producers of goods and services and as customers. The
role of marketing in the success of a business is as old as the business. But this
importance was realized much later. Peter Drucker, one of the notable writers and thinkers
of management highlighted the role of marketing in his book, ‘The Practice of Management’.
According to Peter Drucker, if we want to know what a business is, we have to start with
its purpose, and its purpose must lie outside the business itself. In fact it must lie in
society since a business organization is an organ of the society. There is one valid definition
of business purpose—”To create a customer.”Marketing managers are responsible for
most of the activities necessary to create the customers. Therefore, marketing is known
as an outward looking function. It is said so because creating a customer means identifying
needs in the market place, finding out which needs the organization can profitably serve,
and developing a marketing programme to convert potential buyers into the customers of
the organization. Let us discuss the terms market and marketing.
6.1 CONCEPT OF MARKET
The word market is derived from the Latin word ‘marcatus’ .According to Philip
Kotler,”A market consists of all the potential customers sharing a particular need or want
who might be willing and able to engage in exchange to satisfy that need or want”. We
may describe market in the following ways:
i. Place concept- A place, may be an area, location or situation where buying and
selling of commodities takes place.
ii. Activity concept- An art of buying and selling. Market for some commodities
may be thought of, not as a geographical meeting place but as getting together of
buyers and sellers in person, by mail, telephone, and internet or online or any
other means of communication with an intention to engage in an exchange process
for mutual gain.
iii. Demand concept :The group of people who have desire for the purchase of
goods accompanied by their ability to purchase. In other words we can say that it
is the sum total of the existing as well as the potential buyers.
, MARKETING MANAGEMENT 127
Therefore MARKET =PEOPLE+PURCHASING POWER+MOTIVATION.
(Willingness to purchase) People who have the capacity and willingness to
purchase a particular product or service form the market base for a business.
6.2 CLASSIFICATION OF MARKET
Market can be classified on the basis of different considerations like the area they
cover time spans, nature of transaction, types of goods dealt with and volume of business
etc. These different types and forms of mistakes have been discussed below :
(a) ON THE BASIS OF AREA
Local market- This is a market which is confined to a limited geographical area.
Markets situated in a town or in a particular area involving buyers and sellers of
that particular area are known as local markets.
Regional markets- This is larger in size than the local market. This covers a wider
area. Regional markets may be at block level, state level or even an area comprising
of a few states like eastern region, western region, southern and northern regional
markets. The buyers in the respective regions have some commonalities amongst
them in terms of buying power, style of living, food habits and cultural similarity
etc.
National market- It covers the entire length and breadth of a country. Goods and
services are bought and sold within the geographical area of the country. The
operation of marketing moves beyond the limits of local and regional markets. The
entire country is treated as a market.
International/Global market- The entire world is treated as market. When
companies carry out their business operation beyond the geographical limits of
their own country or domestic market, they are said to have been engaged in
international marketing. In the present era of open economy companies are moving
around the globe in search of business opportunity in a barrier free economic and
business environment, which is an essential feature of global market.
(b) ON THE BASIS OF TIME
MARKETING MANAGEMENT
CONCEPTS, TYPES AND FUNCTIONS
STRUCTURE
6.0 Introduction
6.1 The concept of market
6.2 The classification of market
6.3 The meaning of marketing
6.4 The evolution of the marketing concept
6.5 Distinction between marketing concept and
selling concept
6.6 The objectives of marketing
6.7 The functions of marketing
6.8 Concept and Importance of Marketing Mix
6.9 Model Questions
6.0 INTRODUCTION :
In an industrial economy, production has no meaning unless the products are exchanged
for money or money’s worth. The success of any business depends on its ability to effect
a fruitful exchange of its products or services among its customers. Marketing is the key
to that success. Efficient marketing management is a pre-requisite for the successful
operation of any business. A business organization has many functional areas of operation
like finance, production, human resource management, research and development,
purchasing, marketing and the like. Marketing occupies an important position in the running
,126 BUSINESS STUDIES AND MANAGEMENT, CLASS-XII
of a business. Marketing is an exciting, dynamic and contemporary field. It influences us
every day in both our roles as producers of goods and services and as customers. The
role of marketing in the success of a business is as old as the business. But this
importance was realized much later. Peter Drucker, one of the notable writers and thinkers
of management highlighted the role of marketing in his book, ‘The Practice of Management’.
According to Peter Drucker, if we want to know what a business is, we have to start with
its purpose, and its purpose must lie outside the business itself. In fact it must lie in
society since a business organization is an organ of the society. There is one valid definition
of business purpose—”To create a customer.”Marketing managers are responsible for
most of the activities necessary to create the customers. Therefore, marketing is known
as an outward looking function. It is said so because creating a customer means identifying
needs in the market place, finding out which needs the organization can profitably serve,
and developing a marketing programme to convert potential buyers into the customers of
the organization. Let us discuss the terms market and marketing.
6.1 CONCEPT OF MARKET
The word market is derived from the Latin word ‘marcatus’ .According to Philip
Kotler,”A market consists of all the potential customers sharing a particular need or want
who might be willing and able to engage in exchange to satisfy that need or want”. We
may describe market in the following ways:
i. Place concept- A place, may be an area, location or situation where buying and
selling of commodities takes place.
ii. Activity concept- An art of buying and selling. Market for some commodities
may be thought of, not as a geographical meeting place but as getting together of
buyers and sellers in person, by mail, telephone, and internet or online or any
other means of communication with an intention to engage in an exchange process
for mutual gain.
iii. Demand concept :The group of people who have desire for the purchase of
goods accompanied by their ability to purchase. In other words we can say that it
is the sum total of the existing as well as the potential buyers.
, MARKETING MANAGEMENT 127
Therefore MARKET =PEOPLE+PURCHASING POWER+MOTIVATION.
(Willingness to purchase) People who have the capacity and willingness to
purchase a particular product or service form the market base for a business.
6.2 CLASSIFICATION OF MARKET
Market can be classified on the basis of different considerations like the area they
cover time spans, nature of transaction, types of goods dealt with and volume of business
etc. These different types and forms of mistakes have been discussed below :
(a) ON THE BASIS OF AREA
Local market- This is a market which is confined to a limited geographical area.
Markets situated in a town or in a particular area involving buyers and sellers of
that particular area are known as local markets.
Regional markets- This is larger in size than the local market. This covers a wider
area. Regional markets may be at block level, state level or even an area comprising
of a few states like eastern region, western region, southern and northern regional
markets. The buyers in the respective regions have some commonalities amongst
them in terms of buying power, style of living, food habits and cultural similarity
etc.
National market- It covers the entire length and breadth of a country. Goods and
services are bought and sold within the geographical area of the country. The
operation of marketing moves beyond the limits of local and regional markets. The
entire country is treated as a market.
International/Global market- The entire world is treated as market. When
companies carry out their business operation beyond the geographical limits of
their own country or domestic market, they are said to have been engaged in
international marketing. In the present era of open economy companies are moving
around the globe in search of business opportunity in a barrier free economic and
business environment, which is an essential feature of global market.
(b) ON THE BASIS OF TIME
