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Defining the new marketing concept (Part 1)

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The old marketing concept--the management philosophy first articulated in the 1950s--is a relic of an earlier period in economic history. Most of its assumptions are no longer appropriate in the competitive global markets of the 1990s. As the marketplace evolves under the converging pressures of changing demographics, politics, economics, technology, and social mores, so are organizations changing. And as organizations change, so must the role of marketing within them.

In the traditional business environment, transactions are conducted in a competitive marketplace between hierarchical, divisionalized, bureaucratic organizations and their customers. Today, however, the world is moving rapidly toward a pattern of economic activity based on long-term relationships and partnerships among economic actors in the loose coalitional frameworks of "network" organizations.

To survive in the future, every business will have to be customer-focused, market-driven, global in scope, and flexible in its ability to deliver superior value to customers whose preferences and expectations change continuously as they are exposed to new product offerings and communications about them.

Global competition is now a fact of economic life for the industrialized nations as well as for most of the developing economies. The global marketplace is as real for the small manufacturer and local retailer or bank as it is for the multinational corporation. All customers have purchasing options that span the globe, not just the community or the nation.

The old marketing concept grew out of the need to serve customers created by the conditions of post-World War II affluence and population growth. These consumers became the beneficiaries of aggressive competition among domestic producers, with new entrants in many industries as firms adjusted from military to peacetime production and entrepreneurs jumped at the prospect of unprecedented growth in consumer spending.

Marketers in the 1950s faced the necessity of becoming truly knowledgeable about and responsive to a...