The production concept and the product concept, with examples

Marketing philosophies

A marketing philosophy (or marketing management orientation) is the guiding idea on which a firm bases its marketing effort, and in particular the weight it gives to the interests of the firm, its customers and society. The main philosophies are the production, product, selling, marketing, societal marketing and holistic marketing concepts. The production and product concepts are the earliest and are internally focused.

The production concept

Under the production concept the firm assumes that buyers chiefly want goods that are easy to get and cheap, so it puts its effort into producing more at lower cost and spreading distribution. It belongs to the early industrial period, when demand ran ahead of supply. Its route to profit is scale: large volumes at a low cost per unit.

When it works. When demand exceeds supply, so that customers want the product more than any particular feature, and when cost is high and must be brought down through scale.

Examples. The early mass-produced motor cars, made in one model and colour to keep costs low. In India, low-cost manufacturers of basic goods, such as plain cotton fabric or budget mobile handsets sold in large volume, rely mainly on cost and wide availability.

Weakness. It can lead to marketing myopia: the firm focuses on its own operations and loses sight of what customers actually want, and customers may reject even a cheap product that does not suit them.

The product concept

Under the product concept the firm assumes that, once goods are plentiful, buyers look for the best quality, performance and features, so it concentrates on improving the product. Its route to profit is quality: a better product that buyers will choose, and pay more for.

When it works. When buyers can judge quality and value it, and when innovation gives the firm a real lead.

Examples. A camera maker that keeps adding megapixels and features; a pressure-cooker company that stresses superior safety and durability.

Weakness. Firms may fall in love with their product and ignore whether the market wants it. A better product will not sell unless it is priced, distributed, promoted and designed around what buyers need: and customers may move to an entirely different solution (as film cameras were replaced by phone cameras).

The two concepts compared

Conclusion

Both concepts are inside-out: they start from the firm's capabilities rather than from customer needs. They still matter, efficiency and quality are necessary, but modern firms combine them with the marketing concept, which starts from the customer.