When the production concept was found, a production oriented business dominated the market. This was from the beginning of Capitalism to the mid 1950’s. During the era of the Production concept, Business concerned itself primarily with production, manufacturing, and efficiency issues.
The reason that Production was given major importance was because of “Says Law” which stated that Supply creates its own demand (from the French economist Jean – Baptiste Say.)
Says law simply meant, If a product is made, somebody will want to buy it. Remember that this was a time when the means of communication were less and people travelled lesser distances too. Sales was mainly done by traveling salesman. And delivering the material after the sales was a hassle as well. There was a shortage of manufactured goods (relative to demand) during this period so goods sold easily.
The basic proposition of the production concept is that customers will choose products and services that are widely available and are of low cost. So business is mainly concerned with making as many units as possible. By concentrating on producing maximum volumes, such a business aims to maximise profitability by exploiting economies of scale.
Managers try to achieve higher volume with low cost and intensive distribution strategy. This seems a viable strategy in a developing market where market expansion is the survival strategy for the business. Companies interested to take the benefit of scale economies pursue this kind of orientation.
In a production-orientated business, the needs of customers are secondary compared with the need to increase output. Such an approach is probably most effective when a business operates in very high growth markets or where the potential for economies of scale is significant. It is natural that the companies cannot deliver quality products and suffer from problems arising out of impersonal behavior with the customers.
Do note, the production concept is a thing of the past and was used when there was very less competition. At such times, the more you produced, the more will be the consumption of the product. An example in this case is FORD, which manufactured huge number of automobiles through its manufacturing assembly line which was the first of its kind.
Also read – Company orientation towards the marketplace
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understandablely
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hello everyone
i want to ask a question
if we want to start a new job portal we require resumes and job postings how can we market new website pls tell me the ways
Frankly online marketing is a huge huge topic. I have not covered it yet because of lack of time. However, please specify whether you want to start a job portal (many paid softwares available) or a new website (needs designers)
You can ask the same at ask.marketing91.com or you can also ask in comments.
Hello M. Hitesh Bhasin I’m M. Ozair
Can You Tell me about the Marketing Myopia? What is Marketing Myopia?
Can you explain it with example of a company, why it is a product oriented company?
Well, there are very few companies following the production concept nowadays. Most of them are actually customer and marketing oriented. Production concept was used when there were very few options in the market.
give me some examples on production concept
I think now a days most of the companies follow Societal Marketing Concept.
I disagree. Many companies have CSR projects where they adopt villages and give back to society. Even the government has implemented measures so that corporates dont harm the environment. But the actual implementation in India is very poor. So many rivers and many land areas are polluted by chemicals. So i think the ideal phase where industrialists themselves take care of Environment and society is far away.
could you please give an example which company follow the production concept
i really need your help
Nowadays hardly any company is following the same. it used to exist when Manufacturing was everything. Ford was the company which started with the manufacturing concept. But nowadays maximum companies are using the “Customer concept”
what is production concept
in marketing
can you put in the easiest example for it?
A live examples is very difficult because all the companies today believe in the customer concept as well as the marketing concept. However, if you see the rise and shine of FORD motor company, then you will know that ford actually established the moving assembly line back in 1913 and that is a perfect example of Production concept in action. Due its sheer genius in production, Ford became the leader of automobiles and amassed a fortune which catapulted it to fame. Much of the success of Ford is attributed to the fact that they can manufacture beautiful cars very fast.
i think most companies follow marketing concept mainly because of profits maximization goal
i think most companies follow marketing concept mainly because of profits maximization goal
with a wider market more profits are attained
Its not only about the market. There is one more concept which is gaining traction – which is the customer concept. Customers have become so informed nowadays due to the presence of the internet, that as a company, the marketing manager has to literally make customer profiles and then make marketing strategies based on each customer profile. Hence Marketing concept and Customer concept are both concepts in vogue.
what philosophy should guide a company’s marketing efforts
how can i cite your writings boss
i wanted the name of todays company applying this concept
Dear Suraj, As i pointed out before, highly unlikely that any company today uses the production concept. Most of them use the customer concept or the societal marketing concept.