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    Marketing Concepts/Exchange

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    1. The competing concepts under which organizations have conducted marketing activities include: the production concept, product concept, selling concept, marketing concept, and holistic marketing concept. Evaluate the advantages and disadvantages of each concept. Which concept do you believe is the most effective? Why?

    2. Exchange is the process of obtaining a desired product from someone by offering something in return. For exchange potential to exist, five conditions must be satisfied: (1) there are at least 2 parties, (2) each party has something that might be of value to the other party, (3) each party is capable of communication and delivery, (4) each party is free to accept or reject the exchange, and (5) each party believes it is appropriate or desirable to deal with the other party.

    Taking the tenets of exchange, apply these collectively and describe an exchange where you left the process feeling like a valued customer. What were the tangible/intangible benefits of the exchange?

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    Solution Preview

    1. The production concept assumes that consumers prefer goods that are cheaply and easily obtained. The advantages of this concept include little R&D expense (innovation is less of a concern) and cost minimization is concentrated upon. This lends to affordable business entry and a steady stream of income versus expenses. The major disadvantage of this concept is that it attracts a lot of competition as barriers to entry are also minimized.

    The product concept is states that a good product will basically sell itself. The advantage of this concept is that marketing expense is minimized and the company generally gains a reputation for quality. The disadvantage of this concept is that competitive marketing can chip away at the firm's market share even if their good is of lesser quality (through brand recognition).

    The marketing concept is concerned with fitting a product to the needs of the market. The advantage of this concept is that a firm doesn't have to maintain huge inventories waiting for other efforts to sell the product. The products fly off ...

    Solution Summary

    The solution describes the differences between marketing concepts including production, product, holistic, and selling.

    Also described are the components of an exchange.