THE BUILDING BLOCKS OF MARKETING

We may view marketing generally as resting on six inter-connected platforms. These are the building blocks of marketing, which are: needs, wants, and demands; products; value and satisfaction: exchange, transactions and relationships; market; marketing and marketers. We shall attempt to run through each of these platforms.

NEEDS, WANTS, AND DEMANDS

Lets us start by differentiating between needs, wants and demands. The purpose of this is to shed light on the frequent accusations by marketing critics that “marketers get people to buy things they don’t want”. We should get it clear that marketers do not create needs. In actual fact, needs pre-exist marketers. However, marketers, along with other influential in the society, influence wants.

For instance, they may suggest that a particular type of car such as a Mercedes Benz V-boot would satisfy a person’s need for social status. In this case, marketers do not create the need for social status, but try to point out how a particular good would satisfy that need. Thus, marketers try to influence demand by making the product attractive, affordable and easily available.

We now go to the distinction between needs, wants and demands:

A human need is a state of felt deprivation of some basic satisfaction. Out of necessity, people require food, clothing, shelter, safety, belonging, esteem, and a few other things for survival. Note that these needs are not created by the society or by marketers. They naturally exist in the composition of human biology and human condition.

Human wants are desires for specific satisfaction of these deeper needs. For example, a man in the city might need food and wants fried rice and chickens; needs clothing and wants a French suit; needs esteem and buys a Mercedes Benz car. In another environment, these needs are satisfied differently. For instance, in a typical rural environment, a man might satisfy his hunger with pap or eko or akamu; his clothing needs with simple buba and sokoto; and his esteem with a shell necklace. People’s needs maythe  be few, but their wants are many. These wants are continual y being shaped and re-shaped by social forces and institutions such as churches, schools, families, and business corporations.

Demands are wants for specific products that are backed up by an ability and • willingness to buy them. Hence, wants become demands only when backed up by purchasing powerPower in physics is the rate of doing work; measured in watt.... For example, many people desire Mercedes Benz cars, but only a few, are real y able and willing to buy one. It is therefore imperative for companies to measure not only how many people want their product, but more importantly, how many of them would actually be willing and able to buy it.

PRODUCTS

People normal y satisfy their needs and wants with products. Products can be defined broadly to cover anything that can be offered to someone to satisfy a need or want. Normal y, we conceive of a product as a physical object, such as a car, a radio or a television set. However, we often use the expression products and services to distinguish between physical objects and intangible ones.

If one critically looks at physical products, one realizes that their importance lies not so much in owning them as in using them to satisfy our wants. For example, we don’t buy a car just to admire it, but because it is a source of service called transportation. Hence, physical products are real y vehicles that deliver services to us.

VALUE AND SATISFACTION

Very often, consumers face a wide variety of products and services that might satisfy a given need. How then do they choose among these variety of goods and services: Normally, consumers make buying choices based on their perceptions of the value that various products and services deliver.

Customer value is the difference between the values the customer gains from owning and using a product and the costs of obtaining the product. For example, DHL customers gain a number of benefits. The most obvious are fast and reliable package delivery.

In addition, these customers may also receive some status and image values. For example, using DHL usual y makes both the package sender and the receiver feel more important. However, when deciding whether to send a package through DHL, customers often weigh these and other values against the money, effort, and psychic costs of using the service. Furthermore, they will compare the value of using DHL against the value of using other courier services such as EMS, Red star and Fedex, and then select the one that gives them the greatest desired value.

Customer satisfaction is the extent to which a product’s perceived performance matches a buyer’s expectation. If the products performance falls short of expectations, the buyer is dissatisfied. If performance matches or exceeds expectations, the buyer is satisfied or delighted. Business-minded marketing companies usual y go out of their way to keep their customers satisfied. You should note that satisfied customers make repeat purchases, and they tell others about their good experiences with the product. The key is to match customer expectations with company performance. This is why smart companies aim to delight customers by promising only what they can deliver, and then delivering more than they promise.

EXCHANGE AND TRANSACTION AND RELATIONSHIPS

The mere fact that people have needs and wants, and can place value on products is necessary, but not sufficient to define marketing. You should realize that marketing exists when people decide to satisfy needs and wants in a certain way that is called exchange. Exchange is one of the four different ways in which a person can obtain a product he or she wants.

The first way is self-production. For instance, a hungry person can relieve hunger through hunting, fishing, or fruit gathering. The person does not have to interact with anyone else. In this particular case therefore, there is no market and no marketing.

The second way is coercion. Here, the hungry person can wrest food from another person forcefully. Hence, no benefit is offered to the other party.

The third way is begging. In this instance, the hungry person can approach someone and beg for food. The supplicant has nothing tangible to offer except gratitude.

The fourth way is exchange. Here, the hungry person can approach someone who has food and offer some resource in exchange, such as money, another good or some service (as in trade by barter).

Marketing evolves from this last approach to acquiring products i.e. exchange. Formal y stated, exchange is the act of obtaining a desired product from someone by offering something in return. Thus, exchange is the defining concept underlying marketing. For exchange to take place, Kotler (1984), lists five conditions that must be satisfied:

(i)      There are at least two parties;

(ii)      Each party has something that might be of value to the other party.

(iii)      Each party is capable of communication and delivery

(iv)            Each party is free to accept or reject the offer.

(v)              (v) Each party believes it is appropriate or desirable to deal with the other party

These five conditions make exchange possible. Whether exchange actual y takes place however, depends on the parties coming to an agreement. If they agree, it is often concluded that the act of exchange has left both of them better off, or at least not worse off. This is in the sense that each was free to reject or accept the offer. Hence, exchange creates value just as production creates value. It gives people more consumption possibilities.

Whereas exchange is the core concept of marketing, a transaction consists of a trade of values between two parties. In a transaction, for instance, we should be able to say that one party gives X to another party and gets Yin return.

Transaction marketing is pail of the larger idea of relationship marketing. Aside from creating short-term transactions, marketers need to build long-term relationships with valued customers, distributors, dealers, and suppliers. They need to build strong economic and social ties by promising and consistently delivering high-quality products, good service, and fair prices. Marketing is rapidly shifting from trying to maximise the profit on each individual transaction to maximizing mutually beneficial relationships with consumers and other parties. Here, the operating assumption is: build good relationships and profitable transactions will follow

 M A R K E T S

A market is the set of actual and potential buyers of a product. Generally, these buyers share a particular need or want that can be satisfied through the exchange. It is thus clear that the size of a market depends on the number of people who exhibit the need, have the resources to engage in exchange, and are willing to offer these resources in exchange for what they want.

The term market originally stood for the place where buyers and sellers gathered to exchange their goods, such as a village square. Economists often use the term to refer to a collection of buyers and sellers who transact in a particular product class, as in the yam market, the cattle market or the grain market.

However, marketers see the sellers as constituting an industry and the buyers as constituting a market.

You can observe from the figure that sellers and buyers are connected by four arrows. The sellers send products, services, and communications to the market: in return, they receive money and information. The inner loop shows an exchange of money for goods: the outer loop shows an exchange of information. This concept of markets finally brings us full circle to the concept of marketing.

MARKETING AND MARKETERS

Marketing means managing markets to bring about exchanges for the purposes of satisfying human needs and wants. If one party is more actively seeking an exchange than the other party, we call the first a marketer, and the second party a prospect. A marketer is someone seeking a resource from someone else and willing to offer something of value in exchange. Usually, the marketer is seeking a response from the other party, either to sell something or buy something. 

Hence, the marketer can be a seller or buyer. Let us imagine that several people want to buy a very attractive house that has just been put up for sale. You will notice that each would-be buyer will try to market himself or herself to be the one the seller selects. Thus, these buyers are doing the marketing. It could so happen that both the seller and the buyer are actively seeking an exchange, and in this instance, it is said that both of them are marketers. This situation is then referred to as one of mutual marketing.

Normally, exchange processes involve some workWork is The transfer of energy from one physical system to a... More. For example, sellers need to search for buyers, identify their needs, design good products and services, set prices for them, promote these goods and services, as well as store and deliver them. Activities such as product development, research, communication, distribution, pricing and service are core marketing activities.