ROLE OF MARKETING IN A DEVELOPING ECONOMY

BY:PRERNA YADAV (75)AANCHAL GUPTA (82)

WHAT IS MARKETING?

According to Philip Kotler, “marketing is a human activity directed at satisfying needs and

wants through exchange process.”

Markets are the context, both physical and conceptual, where exchange takes place.

Marketing includes all activities from the producer to the final including processing and distribution systems.

The term Producer includes farmers and the manufacturers of production inputs when they produce the commodity being marketed.

MARKETING TERMS

The term Consumer is used for anyone who is the final consumer of a product or the final user of a production

The Retailer is the final link in the chain from producer to consumer.

ECONOMIC DEVELOPMENT

 Economic development can be referred to as the quantitative and qualitative changes in the economy. Such actions can involve multiple areas including development of human capital, critical infrastructure, regional competitiveness, environmental sustainability, social inclusion, health, safety, literacy, and other initiatives.

External Environment

1. Competitors2. Social and Ethical

Forces3. Political and Legal

Forces4. Market Demand5. Technology6. Distribution

Structure

Internal Environment

1. Product Range2. Price Structure3. Promotional

Activities4. Geographical

Reach & Location

MARKETING ENVIRONMENT

FUNCTIONS

PRICING SELLING FINANCING PROMOTING DISTRIBUTION PRODUCT MANAGEMENT MARKETING INFORMATION

MANAGEMENT

Marketing is central to economic development. Marketing can be defined as a means by which an economy can be integrated. In general, this integration is between buyers and sellers, as well as different regions and sectors of the economy.

Many economists hold the view that integration is the chief aim of marketing, especially in less-developed states.

FUNCTIONS OF MARKETING IN A DEVELOPING ECONOMY

Marketing stimulates the aggregate demand thereby enlarges the size of market.

Marketing in basic industries, agriculture, mining and plantation industries helps in distribution of output without which there is no possibility of mobilization of goods and services which is the key point for economic growth. These industries are the back bone of economic growth.

It also accelerates the process of monetizing the economy which in turn facilitates the transfer of investible resources

Intermediate industrial goods and Semi-industrial products etc. essentially marketed for industrial purpose in order to develop the industrial sector with a view to economic growth.

In Export trade and services like tourism and banking, marketing plays eminent role in order to grow the economy

WHY MARKETING SYSTEMS ARE NOT DEVELOPED IN DEVELOPING ECONOMIES

PRODUCTION ORIENTATION OF THE ECONOMIC PLANNERS:

There is a strongly held opinion that an economic system must first have the capacity to produce before the level of consumption and distribution becomes a problem.

INTANGIBLE NATURE OF MARKETING: Marketing is difficult to quantify

compared to production, where as accurate quantitative information is important for planning purposes.

THE INFLUENCE OF IMPORT ORIENTATION:

A strong dependence upon imported manufactured goods normally is reflected in his structure of the market and general business practices

SIGNIFICANCE OF MARKETING IN A DEVELOPING ECONOMY

GENERAL IMPROVEMENTS make the product capable of being brought to

markets instead of perishing. make the consumer capable of discrimination. improves the life-style and well being of the

people in the economy upgrades world markets Increases the purchasing power

Increased economic activity leads to enlarged markets which set the stage for economies of scale in distribution and production .

GROWTH OF MONEY ECONOMY With money instead of barter as a medium of

trade, a society can develop a wider choice in consumption opportunity.

UTILISATION BY THE ENTREPRENEUR It’s the entrepreneur and manager who alone

can convey to the people of the country an understanding of what economic development means and how it can be achieved.

DEVELOPER OF STANDARDS Developer of standards for product and

service as well as standard of conduct, integrity etc and basic long range impact of decisions on customers, suppliers etc.

DISCIPLINE OF MARKETING Marketing has become systemized over the

years, it is now both learnable and teachable. Marketing practices have been in a form in which we can express it as general concepts, as valid principles and to a substantial degree, as quantifiable measurements.

SIGNIFICANCE RECOMMENDATIONS An actual system of matching

production capacity and resources with consumer needs, and purchasing power to eliminate some of the inefficiencies that exist in the economy of our country.

ROLE OF MARKETING IN DEVELOPING ECONOMY

Marketing and trade play vital roles in the economic growth and overall development of a nation. The major roles of marketing and trade in the national economy can be thought of in terms of:

Specialisation in activities of comparative advantage

Enhanced resource-use efficiency and trade Advances in marketing with economic growth

SPECIALISATION IN ACTIVITIES OF COMPARATIVE ADVANTAGE

In the presence of a market, an individual can specialise in one activity and sell the surplus in order to purchase other needed goods. The individual is likely to specialise on the basis of a comparative advantage in that activity for which he or she has some special resource or ability.A comparative advantage exists when an individual or region can produce a good, relative to the price of other goods, more cheaply than another individual or region.

ENHANCED RESOURCE USE EFFICIENCY AND TRADE

Through specialisation and trade, a community is better able to utilise its limited resources. Specialisation and the resulting efficiency of resource-use is the basis for economic growth and development.

As markets and economies develop, surpluses occur more frequently in profitable activities, creating new wealth, while products are moved greater distances than before.

Thus, trade is a necessary ingredient for economic growth. Marketing is simply the means by which trade occurs.

ADVANCES IN MARKETING WITH ECONOMIC GROWTH

As economic growth proceeds, several changes in marketing take place. With economic development, the activities and tasks of marketing increase. Activities such as storage and processing, packaging and retail distribution become more important.

More activities move away from the site of production and towards marketing. This, in turn, creates employment opportunities and further specialisation (diversification of the community).

With development, more economic agents may enter trade, helping to improve marketing services and, in some cases, allowing the market to capture external economies of scale. This refers to a situation where the presence of many agents allows each one to operate at a lower cost.

Marketing plays a vital role in economic growth in the present global world.  It ensures the planned economic growth in the developing economy where the scarcity of goods, services, ideas and excessive unemployment, thereby marketing efforts are needed for mobilization of economic resources for additional production of ideas, goods and services resulting in greater employment.

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