Concept
The
'marketing concept' proposes that in order to satisfy the organizational
objectives, an organization should anticipate the needs and wants of consumers
and satisfy these more effectively than competitors. This concept originated
from Adam Smith's book The Wealth of Nations, but would not become widely used
until nearly 200 years later.[11] Marketing and Marketing Concepts are directly
related.
Given the
centrality of customer needs and wants in marketing, a rich understanding of
these concepts is essential:[12]
Needs:
Something necessary for people to live a healthy, stable and safe life. When
needs remain unfulfilled, there is a clear adverse outcome: a dysfunction or
death. Needs can be objective and physical, such as the need for food, water
and shelter; or subjective and psychological, such as the need to belong to a
family or social group and the need for self-esteem.
Wants:
Something that is desired, wished for or aspired to. Wants are not essential
for basic survival and are often shaped by culture or peer-groups.
Demands:
When needs and wants are backed by the ability to pay, they have the potential
to become economic demands.
Marketing
research, conducted for the purpose of new product development or product
improvement, is often concerned with identifying the consumer's unmet needs.
[13] Customer needs are central to market segmentation which is concerned with
dividing markets into distinct groups of buyers on the basis of "distinct
needs, characteristics, or behaviors who might require separate products or
marketing mixes." [14] Needs-based segmentation (also known as benefit
segmentation) "places the customers' desires at the forefront of how a
company designs and markets products or services." [15] Although
needs-based segmentation is difficult to do in practice, has been proved to be
one of the most effective ways to segment a market. [16] In addition, a great
deal of advertising and promotion is designed to show how a given product's
benefits meet the customer's needs, wants or expectations in a unique way.[17]