Download Understanding Paradigm Shift from Marketing

International Journal of Operations and Logistics Management
p-ISSN: 2310-4945; e-ISSN: 2309-8023
Volume: 3, Issue: 2, Pages: 188-191 (June 2014)
© Academy of Business & Scientific Research
www.absronline.org/journals
Understanding Paradigm Shift from Marketing-Mix to Relationship
Marketing
Anila Mushtaq
[email protected]
The major purpose of this article is to understand the concept of marketing and evolution
in marketing discipline over the time. This paper presents conceptualization of marketing
and elaborates the role of marketing in the field of management sciences. This study
covered in the two major paradigms in the marketing management and their importance
for marketer: marketing-mix and relationship marketing. Marketing is a border field and
due time constraint, the focus was too narrow.
Keywords: Marketing, Marketing Myopia, Marketing Mix, Relationship Marketing
INTRODUCTION
Background and Importance of Marketing
In today’s dynamic environment businesses are
consistently facing unavoidable challenges such as
technology and globalization, resulting high
competitive business environment. This high
competition enforced firms to explore new ways of
doing business. It has become critical for
businesses to identify what business they are really
doing? True understanding of business area has
become a hot issue now days. Levitt (1960)
discussed in “Marketing Myopia” which also won
McKinsey award, that today we are looking some
successful and high growth industries are
declining while industries showing seasonal
growth has been stopped growing. Reason is not
that market is saturated; the reason is failure in
managing the change. Businesses should change
their preferences. Their performance will be boost,
focus on customers’ needs instead of selling
products. Multibillion-dollar businesses have
bankrupted due to adopting tradition philosophies
of doing business and not gave importance to
customers’ needs and wants. A company could not
survive if not offer product according to customer
preferences.
It is difficult for companies to survive by
performing job effectively. They must perform
efficiently to maintain their position in competitive
market place. Recent studies have shown that
traditional ways of doing business are no more
useful to make profit. They key to greater
company’s’ performance is the awareness and
fulfilling customer need by offering superior
product and service. This pressure not only
affected the businesses, but also different
disciplines in business and management like
marketing. Currently, marketing has become the
heart of any successful business. Most aspects of
any successful business are depending on
successful marketing. Now marketing is not just
selling the products and earn profit, but looking
beyond the selling. Business philosophy has been
*Corresponding author: Anila Mushtaq,
E-Mail: [email protected]
188
Int. j. oper. logist. manag.
p-ISSN: 2310-4945; e-ISSN: 2309-8023
Volume: 3, Issue: 2, Pages: 188-191
changed. Most successful organizations are those
which are market-oriented. Market-oriented
organization can be best described as the
organization whose actions are according to the
marketing definition, satisfying customers’ needs
and wants through keeping in mind their
preferences (Kohli & Jaworski, 1990).
The major purpose of this article was to
understand the marketing concept by reviewing
the existing literature. The major focus was to
enhance the comprehension about marketing
conceptualization with the passage of time,
specially discussed product oriented marketing
and customer oriented marketing.
CONCEPTUALIZATION OF MARKETING
History of marketing is as long as the history of
human being on the earth. Because every
individual has some needs and wants. People were
satisfying their needs and wants by acquiring
products and services. Although approaches were
totally different, but it was the origin of marketing.
With the modernizations, needs and wants have
been changed and they ways to satisfy them also
has been changes. Marketing concept also has been
changed. Conceptually, all marketing activities
should be based on customers’ needs and wants in
target markets (Grönroos, 1989). If a firm performs
all operations according to this philosophy, it
should be successful and profitable. Marketing
therefore involves around all those activities which
mainly focus on customer’s unsatisfied needs and
wants. Need identification is basic phenomena for
all business operation. If a marketer identifies a
need successfully, the business will be also
successful. In 1985, The American Marketing
association defines marketing as “marketing is the
process of planning and executing the conception,
pricing, promotion and distribution of ideas,
goods and services to create exchange and satisfy
individual
and
organizational
objectives”"
(Marketing News, 1985, p.1).
While Felton (1959, p. 55) considers marketing as
"a corporate state of mind that insists on the
integration and coordination of all the marketing
functions which, in turn, are melded with all other
corporate functions, for the basic purpose of
producing maximum long-range corporate
profits." On the other hand McNamara (1972, p. 51)
defines marketing as "a philosophy of business
management, based upon a company- wide
acceptance of the need for customer orientation,
profit orientation, and recognition of the important
role of marketing in communicating the needs of
the market to all major corporate departments.
It has been evident that, all the time, marketer’s
main concern was to fulfill customers’ needs and
preferences
and
enhance
organizational
performance. To achieve these objectives,
marketing management designed marketing
strategy accordingly and marketers were also
using those marketing tools which were
appropriate like four Ps of marketing mix. But
with the passage of time, marketing paradigm
changed. Now the need was to build long term
relationship with customers. So this was a shift in
paradigm form transaction marketing to
relationship marketing (Webster Jr., 2005).
MARKETING MIX (Product-Oriented)
Literature shows that historically marketers’ major
focus was to maximize profit focus on customers
need. Marketing was just product oriented.
Products were introduced after assessing the needs
and demand for the products. Marketer’s major
role was to asses, create and maintain demand for
product. Demand level played critical role for
production planning as well as all other
organizational activities. Marketing management
was involved in making strategies according to
level of demand. Generally, target marketing and
marketing mix (four Ps) has been utilized for
designing marketing strategy (Kotler, 1973).
Marketing mix emerge as an effective strategy
while marketer were facing competition. They
blended important ingredients into a single box
“marketing mix” so that to maximize profit
(Culliton, 1948). Marketing experts agreed that
any marketing theory must fulfill the requirements
of marketing concept. For example, the belief that
organization is designing and executing all of
activities in order to satisfy customers’ needs and
wants in selected target market. Does marketing
mix fit into that? Grönroos (1994) argued that it is
easy to for any one that four Ps (marketing mix)
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Paradigm shift from marketing-mix to relationship marketing
are not able to fulfill marketing requirements
appropriately. Because marketing mix is a
production-oriented approach not customer or
market-oriented
approach.
Moreover,
this
approach does not consider any sort of interaction
which is also a weakness of this approach
(McCarthy, 1960; Grönroos, 1994). Research has
shown that marketing mix has dominated
marketing about 40 years, but now this paradigm
is on decline and failed to get previous position
(Sheth et al., 1988).
RELATIONSHIP
Oriented)
MARKETING
(Customer-
Emerging trends like relationship marketing has
been successfully gained the attention and widely
discussed as effective approach in marketing
literature (Jackson, 1985). Relationship marketing
helped marketers to view marketing differently. It
pushed them to give up the concept of
transactional marketing which is just a single
transaction approach, while to look at relational
marketing which focuses on repeated transaction
(Grönroos, 1994). This approach mainly focused on
building the relationship with customers. This
kind of marketing focuses on existing customers
and gives the value. In return, company can
produce loyal customers. The theory assumes that,
when we involve in a transaction, we are making
exchange and building relationship. If the
relationship will be stronger, exchange will occur
again and again. Bagozzi (1975) concluded that
now marketing is based on exchange. Exchange is
central approach to in marketing and also for
“general theory of marketing”.
Initially, relation marketing considered for the
service industry and business to business
transaction (Morgan & Hunt, 1994; Egan, 2003).
After that, it has been expanded to consumers
market too. Increased scope of this exchange
pushed Morgan and Hunts to define relationship
marketing (1994). According to them, relationship
marketing consists on “all those activities which
establish develop and maintain positive relational
exchange”.
Furthermore, Morgan and Hunt
explained that, trust and commitment are the
major factors in relationship marketing. Successful
exchange needs trust and commitment. For
Anila Mushtaq
example if an organization promised with to
customer to deliver the order within specific time
period and also with the same quality. This
increases the trust level, makes the relationship
strong and increases organizational performance.
Apart from benefits, there are also some dark sides
of relationship marketing. For instance, decreasing
interests in relationship due to inertia and
inefficient relationship over the years make
relationship weak even finally diminished
(Moorman et al., 1994; Haytko 2004). Although
relationship marketing has some negative aspects
but it does not mean that company make and
implement weak and confusing relationship
marketing strategy. Company should make a
sound strategy keeping in mind all the facts and
protect itself to face any negative consequences
(Colgate & Danaher 2000).
CONCLUSION AND RECOMMENDATIONS
The purpose of this study was to enhance
understanding of marketing through reviewing
existing marketing literature, with special focus on
marketing mix and relationship marketing.
Initially marketing has not given much importance
in business. It was just perceived as economic
activity. But later, marketing got attention of
researcher as well as business people and they
realized that marketing has become the essential
part of company’s strategy and management
sciences. After realizing this fact, that marketing is
the major factor which is playing role in companies
fall and progress. It became the hot topic for
researcher. Marketing philosophy changed over
the time according to the changes in business
environment. This study thorough analyzed
marketing mix and relationship marketing. Both
strategies are essential for successful business.
Although, the major focus has been diverted
toward relationship marketing but the importance
of marketing mix can never be denied. Company
can use them along with marketing relationship
strategy which can boost company performance
more. This research covers the literature of specific
time period. Future research can expand time
frame up to the fresh research in the field of
marketing.
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Int. j. oper. logist. manag.
p-ISSN: 2310-4945; e-ISSN: 2309-8023
Volume: 3, Issue: 2, Pages: 188-191
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