Explain the following ; (i) marketing concept (ii) marketing mix (iii) market segmentation (iv) product differentiation

Answer Details

(i) Marketing concept

The marketing concept is a business philosophy which holds that the key to achieving the goals of an organisation is to identify the needs and wants of the target customers and satisfy them more effectively and efficiently than competitors do. It puts customer satisfaction at the centre of all business activities, so that the firm produces what it can sell rather than trying to sell what it can produce.

(ii) Marketing mix

The marketing mix is the combination of the controllable elements that a firm blends together to satisfy its target market and achieve its objectives. It is commonly known as the 4 Ps: Product (the goods or services offered), Price (the amount charged), Place (the channels and location through which goods reach the buyer) and Promotion (advertising and other efforts to inform and persuade customers).

(iii) Market segmentation

Market segmentation is the process of dividing a large, varied market into smaller groups of buyers who have similar needs, tastes or characteristics, so that the firm can serve each group more effectively. Markets may be segmented on the basis of age, sex, income, occupation, taste or geographical location.

(iv) Product differentiation

Product differentiation is the effort by a producer to make his product appear different from and more attractive than similar products of competitors. This is done through features such as branding, special packaging, quality, design or colour, so that customers can distinguish it and develop a preference for it.