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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) 189 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. 190 Int. j. oper. logist. manag. p-ISSN: 2310-4945; e-ISSN: 2309-8023 Volume: 3, Issue: 2, Pages: 188-191 REFERENCES Higgins, H. (1985, March, 1). AMA Approves New Marketing Definition. Marketing News, (5) Grönroos, C. (1989). Defining Marketing: A Market-Oriented Approach. European Journal of Marketing, 23(1), 52 – 60. Culliton, J.W. (1948). The Management of Marketing Costs. Harvard University Press, Boston, MA. Colgate. , Mark, R., & Danaher, P. J. (2000). Implementing a Customer Relationship Strategy: The Asymmetric Impact of Poor versus Excellent Execution. Journal of the Academy of Marketing Science, 28 (3), 375387. Egan, J. (2003). Back to the future: Divergence in relationship marketing research. Marketing Theory, 3(1), 145-157. Morgan, R. M., & Hunt, S. D. (1994). The commitment-trust theory of relationship marketing. Journal of Marketing, 58(3), 20. Moorman, Christine, Zaltman, G. & Deshpande, R. (1992). Relationships between Providers and Users of Market Research: The Dynamics of Trust within and Between Organizations. Journal of Marketing Research, 29 (3), 314-328. Kotler, P. (1973). The Major Tasks of Marketing Management. Journal of Marketing, 37(4), 42-49. Sheth, J.N., Gardner, D.M. & Garrett, D.E. (1988). Marketing Theory: Evolution and Evaluation. Wiley, New York, NY. Webster Jr. F. E. (2005). 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