Production Concept in Marketing- A business combines interlinked operations performed by individuals with unique functionalities. One of these many operations is known as marketing which refers to the actions and procedures related to promoting its services and products.
Marketing is referred to as the process of providing the right services and products to the right audience at the right time. This is a complete guide to the overall concept of marketing. Several types of promotions are used to target a specific audience.
The reason that Production was given major importance was because of “Says Law” which stated that, “Supply will creates its own Demand”(from the French economist Jean — Baptiste Say.)
“Says law” simply meant, If a product is made, somebody will buy it. Remember again that this was a time when the means of communication were less and people travelled lesser distances too. Sales was mainly done by traveling salesman. And delivering the material after the sales was a hassle as well. There was a shortage of manufactured goods (relative to demand ) during this period so goods sold easily.
Production Concept in Marketing
Marketing is based on five fundamental concepts that structure and organise your organisational operations. These five concepts of marketing are:
- The Selling concept
- The Production concept
- The Product concept
- The Marketing concept
- The Societal Marketing concept
These are the five pillars of concepts in marketing. So let’s have a deep dive into these concepts of marketing.
The Selling Concept
The selling concept is a standard business orientation that holds the idea of consumers and businesses. It means that if consumers and businesses are left alone, they will not trade enough of its services and products. This marketing concept presumes the consumer’s nature of resistance and that they must be coaxed into buying. The selling concept also assumes that the business organisation has countless practical promotional and selling tools to initiate and stimulate more business. Nowadays, this concept is practised by most firms to sell whatever they can make, rather than what the market demands.
The Production Concept
The production concept is the oldest of all the concepts available of marketing in business. It refers that the consumer has a nature of referring to products that are available in more quantity and inexpensive. Several business managers use this concept of marketing to concentrate and follow the path to achieve efficiency in high production with low costs and wide and mass distribution. This marketing concept makes sense and is practised in most developing countries where customers are in client towards the product then its features.
The Product Concept
The product concept orientation states that consumers fall for the most impressive quality, innovative features, and best-in-class performance. Several managers focus on this concept of marketing with another option that the customer will prefer well-built products and favour quality and performance. However, this concept of marketing sometimes feels when the manufacturer decides to give quality without realising the market demand.
The Marketing Concept
The marketing philosophy is like a concept that went rogue after seeing the above three business concepts. This concept of marketing challenges all the three previously discussed business orientations. It states that the only way to achieve organisational goals is to become better and more effective than your present competitors in developing, delivering, and establishing better communication with your customers to improve your selected target customers.
The Societal Marketing Concept
The societal Marketing concept States that the task of an organisation is to determine the demand and interest of its target customers and develop and deliver a product with desired satisfaction and is more effective and efficient than the competitors. In addition to it, it also holds that all these marketing processes must be done to enhance and preserve society and customers’ well-being.
The social Marketing concept came into existence when some people questioned whether the Marketing concept is good in resource shortages, world hunger, neglected social services, environmental deterioration, and poverty.
Applications of Marketing Concepts
The Production Concept
The production concept is applicable only in two situations:
- First, if the demand for a product becomes more significant than the supply, this results in a price-sensitive and budget-conscious market. Whenever higher demand and supply conditions arise, the customer becomes more interested in owning the product than the quality and features.
- The production concept comes into play when the production costs are incredibly high, and eventually, it makes the customer resist buying the services or product. This results in cost-cutting with a motive to bring down the prices.
The Product Concept
The application of product concepts can be learned by example.
Suppose a company makes the best in class CDs. But the question here is, do they need a CD?
Whenever they need something used to store the data, they will go for a USB drive, memory cards, or portable hard disks. It signifies that the company should start focusing on meeting customer demands. Just like this, your business should also have a USP to stand out with your product.
The Selling Concept
The best example to learn from is soft drinks. They come up with new ideas that create an unforgettable image in the customer’s mind and urge them to buy the product.
The Marketing Concept
It concerns the understanding of customers and then delivering products that are better to stand out in the competition.
The Societal Marketing Concept
These are the organisation’s efforts that concern social well-being. The best example to relate to this concept is renewable energy vehicles.
Definition of Production Concept
The Production Concept is a marketing strategy based on the idea that customers prefer products that are widely available and affordable. Companies using this approach focus on producing large quantities of goods to benefit from lower costs per unit, making products cheaper for consumers.
A Brief History
The Production Concept in marketing began during the Industrial Revolution, a time when businesses were focused on meeting the growing demand for products due to a rapidly expanding population.
In the early 20th century, companies embraced this concept to boost their efficiency by producing goods in large volumes. They believed that mass production would lower costs and make products more affordable, which in turn would increase sales and profits.
During this period, the main goal was to create as many products as possible at a lower cost per unit.
This approach worked well when labor was inexpensive and demand was high. It allowed companies to flood the market with affordable goods and capitalize on economies of scale.
Even today, the production concept remains relevant in certain contexts, such as in countries with low-cost labor like China and India. These nations use mass production to offer cost-effective products globally.
However, as markets have become more competitive, the production concept needs to be balanced with a focus on quality and customer preferences.
Characteristics of Production Concept
Here are the five key characteristics of the production concept:
Mass Production Focus
The production concept emphasizes creating large quantities of products. By producing in bulk, companies can achieve economies of scale, reducing the cost per unit and making products more affordable.
Cost Efficiency Emphasis
Companies prioritize minimizing production costs. Streamlining operations and using cost-effective methods are crucial to keeping expenses low and maximizing profitability.
Widespread Availability
This concept believes that products should be widely available to attract customers. Ensuring that goods are accessible in many locations helps meet high demand and increases sales.
Price-Centric Approach
Under the production concept, price is considered the main factor influencing consumer choice. Businesses focus on keeping prices low to appeal to price-sensitive customers.
Historical Significance
Originating during the Industrial Revolution, the production concept was crucial for meeting the high demand of the era. Although its prominence has waned, it remains relevant in contexts where cost reduction and mass production are key.
Pros of the Production Concept
Affordable Prices
By focusing on mass production, companies can lower production costs and pass these savings on to customers. This results in lower prices, making products more accessible to a wider audience.
Job Creation
Mass production requires a larger workforce, leading to increased employment opportunities in manufacturing and related sectors. This supports local economies and provides jobs for many people.
Market Filling
The production concept ensures that products are widely available, helping to meet high demand and prevent shortages. This stability can build a loyal customer base and ensure consistent sales.
Investor Attraction
Businesses that efficiently produce large quantities of goods often generate higher profits. This profitability can attract investors looking for stable and lucrative opportunities.
Cons of the Production Concept
Quality Compromise
Emphasizing quantity over quality can lead to lower product standards. The focus on mass production might result in products that do not meet higher quality expectations.
Neglecting Customer Preferences
The production concept’s focus on mass production may overlook individual customer needs and preferences. This can lead to a lack of product variety and personalization.
Market Saturation
Flooding the market with low-cost goods can eventually saturate demand. Once the market is saturated, it becomes challenging to find new growth opportunities.
Environmental Impact
Large-scale production can lead to increased resource consumption and waste. The environmental footprint of mass production can contribute to issues like resource depletion and pollution.
Examples of Production Concept
China’s Manufacturing Sector
China exemplifies the production concept with its vast manufacturing industry. By leveraging affordable labor and mass production techniques, Chinese companies produce large quantities of goods at low costs.
For example, Foxconn manufactures electronic components for global brands like Apple, maintaining competitive pricing through efficient, high-volume production.
India’s IT Services:
India applies the production concept in its IT sector. With a large pool of skilled professionals and cost-effective labor, Indian companies like Tata Consultancy Services (TCS) and Infosys deliver IT solutions on a massive scale.
Their focus on efficiency and scalability allows them to offer services at lower costs, attracting clients from around the world.
Fast Fashion Brands
Brands like Zara and H&M use the production concept to quickly produce and distribute trendy clothing.
By employing rapid mass production techniques and efficient supply chains, they keep prices low and make fashionable items widely available. This approach allows them to cater to a broad customer base with constantly updated styles.
Conclusion
Marketing plays a crucial role in connecting your brand to your customers. It is a multilevel operation with several concepts in it. These concepts are vital for your company’s operational approach and simplify your customer acquisition to stay and survive in this competitive business world. Five concepts of marketing tie the customer and producer in a two-way relationship where one affects and modifies itself according to the other. Visit our site to get such important information.
