Article from Karl Moore:
Karl Moore is PHd associate professor in the Faculty of Management at McGill University was responsible for writing the article “The Marketing Concept- RIP” which was published July 17th, 2006. He discusses the decline and the increasing irrelevance of the marketing concept idea and how firms are adapting this strategy in today’s market.
Moore emphasis on the following points:
1. Importance of market research before launching a product
2. The need to focus on the product’s usage by the end users 3. The difficulty firms face to implement the marketing concept strategy in today’s market place.
The author uses the example of the high-tech sector and explains why he feels the marketing concept applied in this way is no longer relevant, then goes into detail about how it is not just limited to the high-tech sector. To understand Moore’s article you need to understand what marketing and the marketing concept it first. Marketing consists of individual and organizational activities that facilitate and expedite satisfying exchange relationships in a dynamic environment through the creation, distribution, promotion and pricing of goods, services and ideas. The main principles of marketing are to satisfy customers, target the “right’ customer, facilitate exchange relationships, stay ahead of competitors and enhance profitability (Crane, Kerin, Hartley, & Rudelius, 2008, p.7). The ultimate goal is to satisfy targeted customers, seeking their loyalty and consumption. The marketing concept can be defined as the philosophy that firms should analyze the needs of their customers and then make decisions to satisfy those needs, better than the competition (Crane, Kerin, Hartley, & Rudelius, 2008, p.17). In his opening paragraph Moore mentions that the marketing concept is “coming to a close” and heading towards a “semi-retirement”. I strongly disagree with this statement. Why? Since the marketing concept era many companies are now transitioning to the market orientation era (Crane, Kerin, Hartley, & Rudelius, 2008, p.17). The focus of the market orientation era is mainly on continuously collecting information about customer needs and competitors’ capabilities and to use this information to create value, ensure customer satisfaction and develop customer relationships (Crane, Kerin, Hartley, & Rudelius, 2008, p.17). Let us look at how Netflix took the Marketing concept in stride. Netflix involved the identification of the unmet or underserved customer needs. Reed Hastings, founder and creator of Netflix started off as a video rental customer himself, tired of paying late fees and having to run to the video store when he wanted to watch a movie, he decided to create something simpler and more convenient for customers (Dean.2010). He was able to draw upon personal experience to help establish the opportunity nucleus and survey what other customers wanted out of a video store. The movie rental industry had already established methods surrounding video rental, late return policies, and membership rules. Hastings believed that without competition, these brick-and-mortar movie rental companies would never have a reason to change (Dean.2010). Reed Hastings, decided to disrupt the traditional video rental business by introducing a new twist on the home movie service (Dean. 2010). A perfect example of advances in technology, adaptation of DVD media over VHS, and an unmet consumer demand is responsible for the successful launch of Hastings’ vision of Netflix. Not unlike other innovative start-up companies, Netflix has undergone several strategy shifts (Dean. 2010). Each change in focus or direction has assured that the company remains dominate in the movie rental industry. It appears that Hastings has followed the Marketing Concept to a tee, he started off with collection information from customer needs’ (his own) and the competitors capabilities (video rental companies were not in a position...
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