Market orientation and product orientation

Marketing focuses on consumer needs and wants and, in modern-day management, it is the consumer who drives product development and production more than the product developer. This is known as a market- or consumer-orientated approach. On the whole, the days of developing a product and then finding a market, a product-orientated approach, are disappearing. However, this still happens to an extent and there are a number of approaches that put the consumer, or market, last:

o Product-orientated businesses invent and develop products in the belief that they will then find consumers to purchase them. They believe that they know what the customers want and that if they produce a product of good enough quality, then it will be purchased. This sort of pure research and development is becoming rarer, but there will always be a place for it to some extent. Firms in certain industries, such as pharmaceuticals and electronics, have to operate in this way to survive. The industries are so innovative that to stand still is to risk going out of business.

o Production-orientated businesses concentrate their efforts on efficiency producing high-quality, relatively cost-efficient products. The belief is that the products will find a market if the price is relatively low and the product is of a high enough quality. Although production-orientated firms are not as prevalent as other types, they do exist, especially in areas where quality, or safety, are of great importance, such as bottled-water plants or the making of crash helmets. +

o Sales-orientated businesses tend to produce a product and then concentrate upon different selling techniques and skills, so that they can then clear their supplies. It is argued that some pyramid selling firms work in exactly this fashion

All of the above approaches take little notice of the consumer and are much more interested in product production and selling techniques.

Market-orientated firms put the consumer/customer first. The business will attempt to produce what the consumers want, rather than try to sell them a product that they do not really want to buy. Market orientation is the most common form of marketing these days and the reasons for it were very well described by Robert Heller, in his book The Supermarketers. He said,

It's quite misguided to pursue the technology-push policy - a delusion with much industrial blood on its hands. The myth goes that if you make a better mousetrap the world will beat a path to your door. It has been disproved again and again, never more comprehensively than by the total defeat of competitors who had genuinely stolen technological marches on IBM in mainframe computers... Despite all such evidence, many allegedly marketing orientated companies still operate on the mousetrap principle: improve the product, they think, and technology push will create the sales.

In fact, success and survival in business depend upon the whole marketing process, which will be covered in this and the next two chapters. Finding out what the consumer wants and then supplying it at a profit requires the following:

· carrying out effective market research and identifying the target groups;

· designing the product;

· assessing the reaction of consumers to both the product and the packaging;

· calculating a suitable price, related to costs of production and what consumers are willing to pay;

· deciding upon a suitable promotional strategy;

· organizing the distribution system that will be used to get the product to the market.

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