Understanding your business orientation can help you effectively direct your efforts in product development, sales, and marketing. Again, the similarities between the different marketing approaches are as important as the differences, which are often a matter of emphasis rather than overall direction. All marketing approaches measure their success in terms of sales, whether these sales are generated through a product or market orientation. A sales orientation simply measures results in terms of units sold rather than other metrics, such as customer retention or attention generated on social media. The five market orientations are manufacturing orientation, product orientation, sales orientation, social orientation, and market orientation. These orientations provide a framework for companies to strategically engage with their customers and stay competitive in their respective markets.
By the end of this article, readers will gain insight into what marketing orientation really is and how to implement it in their own businesses. We’ll also explore how companies are using marketing orientation to find success and stay ahead of the competition. Marketing orientation is an important concept in modern business that is widely debated and studied. This article takes a closer look at marketing orientation and provides an overview of the subject, including examples of key concepts and strategies. Marketing orientation is the business approach that dictates all the processes within that organization. It outlines how the company’s core offering is presented to its users and how the marketing teams are empowered.
Indeed, as the market develops and technology starts to get commoditized, it’s critical to be able to dominate a market in order to really take advantage of being a first-mover. However, opening up a whole new market requires considerable effort, as there is not yet a well-defined set of customers. Founder Henry Ford wanted to create a car that was easier to manufacture, inexpensive to repair, and simple to drive for customers who were unaccustomed to cars as a form of transportation. The availability of products allows people to have more choices to satisfy their needs and wants. It’s easy for customers to say what they want, because they don’t have to think about the logistics part. For example, in a food item, customers might be looking for more organic ingredients, lower prices, or fewer calories.
Stages of Market Orientation
What drives them are customer needs – they are listed as their main objective. In the past, the common practice was to develop a product first and then find a market for it. This method was very inclined to failure in itself because there was no previous research to back the fact that the product was serving an actual need. In some cases, the product could be a great idea but the market didn’t need it at all, and that caused the invention to fail. Let’s take a more in-depth look at what each orientation means, its advantages and disadvantages, as well as some real-life business examples that illustrate how they work.
Within the market-orientation paradigm, profitability encapsulates both financial measures (EVA, market share, ROI), and non-financial measures (attitudes, behavioral patterns, awareness). Then, the explosion of the internet resulted in customer empowerment, and customers now have loads of information about product features, peer recommendations, prices, and more. Now that you know the basics of what market orientation is, let’s head over to the next section where we will explore how market orientation works in detail. Job applicants are carefully screened to make sure they fit the restructured image, workers become involved in activities that remind them of the company’s process of cultural change. Employees are rewarded as the business’ performance in the marketplace improves. Market oriented commercial enterprises define their activities as service activities aimed at satisfying their customers.
Examples of Marketing-Oriented Companies
Excitement is also built by differentiating their products and providing more than expected. When customers are thrilled with the performance and value of one product, they’ll be more excited for the next release. Once they understand what current and future customers want, marketing-oriented companies meet and exceed those desires. Apple is a prime example of a company that understands what will excite its customers, and then Apple over-delivers. When its customers ask for a sleek design, Apple responds with beautiful devices that are sophisticated and eye-catching.
It works by understanding the needs of customers and responding to those needs. It is a process that is customer-centric, meaning that all elements of an organization’s operations, from product design to customer service, should be aimed at satisfying customer needs. This approach is based on the notion that all decisions taken by a business should be focused on satisfying customer requirements.
Advantages & Disadvantages of Market Orientation
The needs are kept in mind while developing and upgrading the product offering. You need to make sure that it’s profitable as well, so you’ve to consider everything from business operations, production, and competitive maps. So, you need to create a healthy balance between short-term and long-term profitability, which is exactly what happens in market orientation.
- The marketing for this product then communicates the low cost as the most important reason to buy the product.
- It can be helpful to work through some market orientation examples to get a better understanding of how this concept can be applied in the business world.
- Since the advent of the Internet, the customer knows much more about the market, what products are out there, what to expect – and he or she demands better quality and more variety.
- This type of organisation emphasises social responsibility, arguing that to achieve long-term success, their marketing strategy should provide value to customers and improve society’s wellbeing.
- Alternatively, sales orientation is also useful when the product is in high demand by the market and is not prone to changing consumer tastes.
- The needs and wants of your customers often originate from fads and trends that don’t usually stay for long.
Marketing continues during product or service launch and follows up with customer response after purchases are made. There are three main identifying characteristics of marketing-oriented companies. They want to know what their potential customers are looking for in products and services. To be successful, companies need to ensure that all departments adopt and promote the market orientation approach so that it becomes an integral part of the corporate culture.
For example, Production orientation focuses on the efficient production of goods and services, while Product orientation focuses on the development of products. According to them, the marketing concept is a business philosophy, whereas the term market orientation refers to the actual implementation of the marketing concept. They added that “a market orientation appears to provide a unifying focus for the efforts and projects of individuals and departments within the organization.” This way, the company always stays up-to-date with the target markets, and strives to bring products that are a perfect match for the market.
- Management in these cases needs to consider how to deliver the market’s needs in ways that make sense for the company’s future operation.
- This is why you should keep the end-user in mind throughout, aka practice the market orientation approach.
- Additionally, it can allow for changes in the products, services, or business model as customer needs and demands shift over time.
- The key is to understand what your customers need in real-time and predict what they’ll want in the future.
- This helps you turn your prospects into actual customers, and your customers into repeat customers.
- The company was founded by a Systems Engineer called Orlando Westchester, who identified that many businesses and individuals didn’t have a clue on how to design a website.
In order to survive in the marketplace, companies must be more sensitive to the needs and demands of customers. Essentially, market orientation is a customer-first approach as the offering is produced in regards to how it meets customer’ demand and expectation. Notable examples include fast-food chains such as Burger King or McDonald’s, which focus on producing high quantities of fast food at the lowest price possible. When Henry Ford developed the assembly line method, he mass-produced relatively inexpensive cars while minimising production costs as much as possible. Production-oriented companies focus on the production process and aim to manufacture goods as cheaply and quickly as possible. A sales orientation especially makes sense at particular points in a product’s life cycle or a company’s life cycle.
With a product oriented approach, the company develops goods and services based on what it does well, rather than what the consumer wants. Production-oriented companies believe that if they rely on mass production to create a quality product at an affordable price point, customers will buy it. Therefore, it doesn’t matter if the product actually meets their wants and needs. A market-oriented strategy starts with the market, but it encompasses all the other elements that make it possible for your business to produce, sell and deliver products. The more these different aspects of your marketing strategy work in tandem, the more effective your efforts will be. Market orientation is a powerful starting point, one that provides valuable insights and objectives.
The marketing for this product then communicates the low cost as the most important reason to buy the product. According to Orientation Marketing, a company can choose to prioritize its actions in five distinct ways. The first of these is production orientation, which focuses on the price of products. The company’s actions focus on reducing the cost of production to provide the lowest price possible to consumers. In production orientation, the business decides that the price of the product is the main driver of value. When used in a business context, market-oriented has a similar meaning to marketing orientation.
The business entities that have adopted this structure have centered their activities on satisfying the customers. Coca-Cola performs extensive research to come up with new flavors for its consumers. For users who are worried about sugar content, the company launched the zero-calorie Diet Coke and undertook several acquisitions of “healthy” brands, such as Dasani, market oriented meaning etc. The market-oriented strategy is all about putting customers first and giving them what they want! This helps you turn your prospects into actual customers, and your customers into repeat customers. In a nutshell, if you put time and resources into collecting information about what your customers actually want, you are more likely to sell your products.
As customer demands evolve quickly, it is essential for businesses to practice a market-oriented strategy. The Body Shop is another example of a company with a market orientation approach. Not only do they champion human rights, but they also use natural materials in production – something their customers appreciate!