Market Orientation Focuses on the Customer
Earlier Production and Sales Orientations Ignored Customer Needs
Mar 1, 2009
It would be hard for today's generation to visualize a marketing scenario where customer needs were ignored. They would be shocked to hear Henry Ford offering his Model T on terms like: "Any customer can have a car painted any color that he wants so long as it is black."
Production-Oriented Marketing
The Henry Ford approach was to focus on production. Manufactured products like the unprecedentedly cheap Model T car had great demand and producers could sell all they could produce. So profit maximization depended on producing as much as possible. Customers had the choice of "any color" as long as it is black, take it or leave it. This approach was the major marketing approach until as late as the 1950s.
Sales-Oriented Marketing
With competitors entering every business, production began to exceed demand. Producers began to compete by focusing on sales methodologies. Sales lead generation, advertising campaigns, novel sales promotional techniques and improved personal selling techniques were the main focus areas.
There was still no concerted focus on customer needs and preferences. Instead, the focus was on manipulating them. Sales orientation was the marketing approach till the early 1970s.
Market-Oriented Marketing
In their attempts to gain an advantage in an increasingly competitive market, companies began to develop new approaches, aided by universities such as Harvard. Qualitative market research appeared on the scene in late 1960s. This method uses depth interviews, focus groups and projective techniques to understand the drives and motives behind consumer behavior.
Market research findings were used to develop products that met consumer expectations better. The products so developed were also promoted more effectively with the better understanding of consumer behavior drivers.
Marketing orientation thus shows an emphasis on market research, customer-needs focused product development and customer-behavior focused promotions. Product warranties, after-sales support and extension of customer credit became the norms during this stage.
Positioning and Branding to Consolidate Competitive Advantage
By segmenting customers into distinct groups and developing offers that met the needs of particular segments precisely, it became possible to create customer loyalty that competitors will find hard to break through. For example, it would be hard to get loyal customers of BMW or Coca-Cola to switch to another brand.
Products and companies were "positioned" in consumer minds through integrated marketing communications (over and above performance). The process reached a stage where established brands could even be used for products completely unrelated to the original ones, e.g. the Mickey Mouse brand.
Marketing in the Future
Consumers are gaining increasing control over what they get. Blogs and social media spread word about products and companies fast. Companies are taking increasing interest in communicating directly with consumers through the same media.
Another development is the facility to customize the product before it is shipped. With online communication tools, it is easy for companies to allow customers to configure products like computers to meet their specific needs.
Market orientation is an approach to marketing that focuses on market research, customer focused product development and promotional efforts based on an understanding of customer behavior drivers. The marketing scenario is changing further with consumers getting increasing control over what they get.
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