Marketing Concept Essay
Question: Explain the marketing concept and its importance to an organization making particular reference to developing relationships with customers. Use an organization familiar to you for illustration. The Marketing concept is concerned with first identifying the consumer needs and then making products that give maximum customer satisfaction.
According to Jobber David (Principles and Practice of Marketing, 2010) in order to achieve organizational goals it all depends on determining the needs and wants of the target markets and delivering satisfaction more effectively and efficiently than the competition and getting optimal profits through customer satisfaction. Marketing begins before the product, service or solution is ready . The firm aims to make products and provide services better than the competitor. Consequently, the company makes sincere efforts towards retaining the customers and also attracting new ones.
If the customers are satisfied with the product, they will buy it again and again and tell other people about it which in turn will attract new customers in the process. If the product proves to be better than what they had expected, the consumers will be really impressed and this will be very beneficial in the long run for the firm and will gain good customer loyalty. For this reason the firm should always focus on the customer centered approach thus making profits through customer satisfaction. The Marketing concept is the most famous and popular concept.
It’s different from mere selling because in the selling concept the firm focuses on selling whatever it has produced. On the other hand in the marketing concept before doing production, you assess the need and desire of the customer and then make a product to suit the needs of the customer accordingly. After this you make sales and finally take customer feedback in order to assess the level of customer satisfaction. The market concept holds that the key to achieving its organizational goals consists of the company being more effective than its competitors.
This is because the purpose of business is to create and keep customers involving only two central functions namely marketing and innovation. The basic function of marketing is to attract and retain customers at a profit. It represents the major change in today’s company orientation that provides the foundation to achieve competitive advantage. The traditional idea underlying marketing is that companies achieve their profit and other objectives by satisfying (even delighting) customers. Commercially, it is much more expensive to attract new customers than to retain existing ones.
Indeed, the cost of attracting a new customer has been found up to six times higher than the cost of retaining old ones. Market-oriented companies recognize the importance of building relationships with customers by creating added value. This notion is extremely important to suppliers of products because satisfied customers are more likely to return to buy more products than dissatisfied ones. Thus customer satisfaction is the central pillar of marketing and is paramount to the creation of a stream of exchanges upon which commercial success of the firm depends.
The Marketing Concept in Equity Bank Equity bank’s success is one of the most heated and marveled stories in the country. It’s one of the most arguably successful firms over the past decade. What this bank has achieved is exceptional over a very limited time period. It seems that what equity bank capitalized on in this robust cut-throat business arena with 44 players including multinationals all scrambling for a piece of the pie was observing and understanding customers(Kenyans) needs and wants in the banking industry.
Equity bank observed that most banks in Kenya would never visualize the idea that a customer could open an account without an initial deposit. The bank it simple and friendly by introducing simple requirements that encouraged all and sundry to open an account with them with just identification and by doing this, it seized the space and built the numbers. This customer friendly features have enhanced the image of the bank and is seen as a ‘’Mwananchi’ (common man’s) bank that listens and cares for its customers.
Equity Bank’s remarkable financial innovation and expansion effectively brought in a huge segment of the population, previously cut off from the formal financial system into the banking hall. The banking landscape is quite different from what it used to be years back. Gone are the days when the big boys in the credit business, comprising of large multinational banks would suddenly raise their minimum account balance requirements thus pushing out a huge chunk of small savers from the financial system.
Here, Equity Bank used the marketing concept by first observing and identifying customers’ needs, then going on to innovate the products they thought would be attractive to customers and rolled out a full marketing plan. The Bank targeted the middle and lower segment of the market and came up with simple requirements to cater for different types of customers who needed various bank services. The bank used non-traditional securities like household goods and revenue streams to provide loans.
This allowed its customers to easily access financial services thereby expanding its market reach and defying the odds and becoming Kenya’s largest bank in newly opened accounts. In a market with 44 licensed commercial banks Equity bank has employed unique marketing strategies and very innovative products and services that have made it the financial powerhouse dwarfing banks that have been in the market since Kenya’s independence. Sub-Saharan Africa is known for its levels of poverty evidenced by few economic opportunities and prevalent inferior incomes.
Huge banks would never give this category of ‘low income earners’ the time of day. Banking was always elitist until Equity Bank walked into the market with the ‘no deposit’ requirement and swooped the numbers. Through its 80 branches nationwide, Equity has ongoing marketing activities targeting potential customers. These activities take three to five days and involve educating customer on the bank’s products and services. The bank also participates in farmers open field days and agricultural shows. The financial literacy, training and education public days are forums the bank uses to reach the public.
Product-specific promotional materials are used for particular events or products. Slogans for the various products and services are also used; the SMS banking slogan is ‘’benki yako mkononi’’ (your bank in your hand) or ‘’Eazzy Banking’’. Loan products have the slogan ‘’Empowering Kenyans to drive Kenya’’. Other slogans include ‘’ Proudly Kenyan Bank’’; Taking banking services to our people’’ and Growing together in trust’’. Potential and existing customers locally and in the Diaspora are also reached through telemarketing and direct mailing.
Equity Bank promises to be the listening, caring financial partner and is committed to empowering Kenyans to drive Kenya. In the light of the brief statistics outlined above, the emphasis to incorporate winning market strategies can never be greater and as a result Equity Bank stands out as one of the most innovative firms able to identify consumer’s needs, and to produce attractive services and banking solutions. In doing this it attracted numerous customers and retained them (customer loyalty) and in the process even acquired new ones. It’s no doubt that Equity Bank may one day be the best Financial Institution in Africa.