Role of Marketing in Indian Economy
According to the statement given by M. J. Baker, Marketing plays a vital role in the economic growth of the country periodically and sustain individuals standard of living. Marketing Definition “Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating, offering, and exchanging products of value with others” (Philip Kotler). Basically human need is state of deprivation or neediness where the people require food, shelter, clothing, belonging, esteem to live up their life.
These needs are not created by the society or either the marketers, it is the existing nature of human biology and human condition. Even though the human needs of the people are few, their wants are many, this is because they are continuously shaped or reshaped by the social forces and their environment which include institutions, families, and business corporations. “Wants of the specific product” is the demand of the people and their willingness to buy them. Companies should not only measure how many people want to buy their product but also the people who are willing and able to buy it. This willingness should be created by the company.
Here comes the Marketing principle how well the company sell their product and satisfy the needs of the customer (Narayana Rao K. V. S. S) Market- “Consists of potential customers sharing a particular need or want who might be willing and able to engage in exchange to satisfy that need or want”(Philip Kotler). Marketer-“AMarketerissomeoneseekingoneormore customers who might engage in an exchange of values”. Marketers are the one who influence demands on the product by making the product attractive, appropriate, affordable, and easily available to target consumers.
People living in different societies or Environment prefer different types of food items, different types of apparel and even different types of jewellery. A product is said to be anything that can be offered to satisfy a need or want (Narayana Rao K. V. S. S). PAGE 3 OF 11 BA602 Assignment QP September 2009 Buyers have differentpreferencesfor attributes of ageneric product. A marketer may have to focus on a particular group of potential buyers for product with specific attribute (Narayana Rao K. V. S. S). Marketing is all about satisfying the needs and wants of the consumers in order to make profitability to the company.
Individuals standard of living mainly rely on the concept of marketing, Marketing improves the standard of living by means of bringing new products to the market periodically. Marketing strategy creates an impact on the peoples mind about the new product and making them adaptable to the product easily through their marketing plan. Today the companies are operating in a marketplace where survival of the fittest is the law. In order to win, the companies are coming out with various new products and evolving strategies. Once the standard of living is improved the economic growth of the country also improves.
Of all the tools available to keep our economy growing, Marketing is the most important, potentially the most powerful and currently the least effective tool, because two third of the economy is based directly on the consumer spending. Marketing sector in India has made remarkable change in the development progress of the countries economy. Over the years India has undergone different change in their technological development, International Competition among countries, Great growth of global trade, Strategic alliances and International relationship.
The early economic sectors of the country were mainly skill based and capital intensive while the new economic sectors are more information intensive based, this is because of the introduction of marketing concept in all streams (Everton R. de Lins). IndianMarketis oneofthebiggestconsumermarkets globally and it has attracted many large Multi National Companies to enter here into to the market. Those companies in the market who provide value for money are the real winners in the Indian market. Growing competitiveness of the companies mainly depend on the export orientation and internationalization. Indian market is open to overseas investment and it is the market which provides high prospects for the growth in all areas of business.
Foreign direct investment (FDI) has contributed lot to the growth of the Indian economy, these investments are open to all the firms, It can be PAGE 4 OF 11 BA602 Assignment QP September 2009 made through Technical collaborations, Financial collaborations, joint ventures, private placements and preferential allotments. Marketing comprehends all business activities involved in the flow of good and services from the points of initial production to final consumer.
This concept may refer to industrial, the agricultural or to the extractive sector. Being a system of linkage between producers and consumers, the market process related to rates of saving and rates of output growth are the two fundamental variables in economic development. Inefficient services lead to high marketing margins and high consumer bills. Prices being high, consumption will tend to be high relative to savings and the quantity demanded decreased, slowing down economic growth. Under an inefficient marketing system the prices received by the producers tend to be lower which negatively affect the amount of output produced.
Aseconomic development precedes,specialization, division of labour and mass production become more distinguishable characteristics in the system, which means that consumers are increasingly separated from producers. This calls for a concomitant development of the marketing system in contrast with more primitive societies where the individuals need less concern with marketing since they have great degree of auto-sufficiency, producers and consumers, if not the same, individuals, live quite often next door to each other. Whateverthecomplexityofthesociety, economic activities are always aimed at providing for the satisfaction of the human wants and needs.
Because of the limitation of the resources of production human and natural resources and because of such resources have alternative uses to meet human wants which are unlimited in the aggregate, man. Depending on the society’s norms, is always more or less concerned with modernizing his techniques of production and with improving his knowledge and skills (which may even result in increased natural resources) so that goods and services obtained with the scarce resources lead to the highest possible level of satisfaction for the human wants.
Humanwants,techniquesofproduction,and resources of production are thus basic elements in an economic system. The role of marketing is to link the consumption activities of the system as expressions of the human wants to production activities which depend on the skills and available resources.
The system is consumer oriented in the sense PAGE 5 OF 11 BA602 Assignment QP September 2009 that the production activities depend on the human wants which are to be met at the right time, the right place by the right product in the right form and at the lowest possible cost. The fact of the insatiability of the human wants in the aggregate, the fact that these wants are frequently shifting, the fact that goods and services are consumed after their production and the fact that most of the resources used in the production process are unrenewable, are forces which keep the economic system in a continuous changing stage, a characteristic, of course, which features marketing also (Everton R. de Lins).
In Indian economy, marketing changing aspects are clearly visible in the sectors like automobiles, paints, cement, software, pharmaceuticals, textiles, tea exports, watch and others. In automobile sector, the Maruthi Udyog joint venture with Suzuki Motor Corporation of japan achieved a milestone in the export of completely built units from the early 2000s. The entry of the global car manufactures like Suzuki and Hyundai, Jaguar and their world class facilities have nearly revolutionized this segment of India marketing sector. The main variables affecting exports in this sector are assembly costs, technology inputs, availability of local parts, shipping and infrastructural facilities and marketing and distribution networks.
The pharmaceutical sector has improved their level of marketing India, some of the leading international firms like Ranbaxy, Cipla and Dr. reddy’s has contributed lot to Indian economy. The largest maker of the world, Renfro Corporation after 2002 formed a company in India called Renfro India. India is said to be the 12th largest economy and 4th largest by purchasing power parity. Apartfrom theforeign companies, therearesome Indian companies like Medical Devices, Hindustan Syringes, Metro Tyres, Gujarat Ambuja Cements, Kamla Dials or Asian paints who have earned promising profits with their investment policies in the different sectors of India Marketing.
The Most important development in the India Software sector with the massive contribution made by the software companies like Wipro, Infosys Technologies, Tata Consultancy Services and others to the economic development of the country by means of reducing the unemployeement, Increasing their investments, Improving the standard of living. PAGE 6 OF 11 BA602 Assignment QP September 2009 Indian Marketing has invited many Foreign and local investor to invest their money in high to develop marketing aspects of the company growth. InIndiatherearemanyFortune500software corporations effectively providing efficient software solution all over the world.
These software solutions have helped their companies to more attractive to the shareholders and customers. Companies like Citibank, General Electric, AT&T, Morgan Stanley, Reebok, General Motors, Fujitsu, Boeing, Pepsi, Coca-Cola, Swissair and British Airways continue to remain ahead of their rivals in the Indian market. Compounded Annual Growth over last five years in India is about 53. 84%, This is because of the number of Fortune 1000 companies outsourced their software solution to India.
This made India a growing source in the worldwide software development. As software companies are contributing lot to Indian economy growth, Today the list of software multinationals companies operating from India are the global software giant in the world such as Microsoft, Novell, Oracle, Fujitsu, Motorola, IBM, SAP,EDS, Computer vision, Hewlett Packard, Digital……here I have given example of one of the leading IT industry in India. Wipro Limited (western India vegetable product ltd) is a $5 billion Indian Business Firm. Wipro is one of the leading IT industries in India. Wipro Ltd has contributed in different sectors such as information technology, Engineering, Consumer Care, Lighting and Healthcare Business.
The Group is lead by the Billionaire Azim Premji. Wipro started asa vegetableoil tradingcompanyin 1947 by Azim premji’s father. Azim Premji in 1966 took on the leadership of the company. He repositioned it and transformed Wipro into a consumer goods company that produced different household items. In 1975 Wipro Fluid power was started to produce pneumatic and hydraulic cylinders. At that time, it was valued upto $2 million. In 1979 Wipro entered into the IT field and began its own computer developing plant and started selling their product in the PAGE 7 OF 11 BA602 Assignment QP September 2009 market.
They developed their marketing plan which made them to become the first Indian’s Computer makers and got license from the ‘Sentinel Computers’ United States and began to build their first mini computers in India. One of the marketing strategies which made them strong on business experience by hiring managers who were computer savvy. In1980Wipro started theirsoftwaredevelopment process and developed customized software packages for their hardware customers.
This made them to expand their business and able to produce the 8086 chip, which is the First Indian chip. In1992Wipro acquired‘Spectramind’ BPO company and entered into the BPO field. They started outsourcing different off shore roots in US and by the end of 2000 Wipro Limited were listed in the New York Stock Exchange. Company’s Revenue grew 450% from 2002 to 2007, with employees of about 90,000(2009). Wipro Technologies deals in following businesses:
- IT Services
- Product Engineering Solutions.
- Technology Infrastructure Service
- Business Process Outsourcing
- Consulting Services
This is clear that one company can contribute lot to the economic growth of the country and improve standard of living, obviously there are lots of companies can play a part.
Conclusion: Marketingasacomponentpartoftheoveralleconomic system is capable of introducing changes in other segment of the economy, though it also reacts to changes in its environmental conditions. The performance of the marketing system depends on the conduct of the business firms which operate in it. Number of firms, size of the market, conditions of entry, formal and informal rules influences the PAGE 8 OF 11 BA602 Assignment QP September 2009 conduct of the firms with regard to modernization of technological process, improvement of managerial capabilities and their general policies.
Because technological and price efficiency frequently require antagonistic conditions, the concept of effective competition has been developed to define a socially desirable state of affairs in the marketing system, a reflection of the society’s expectancy regarding the market’s conduct and performance. Increasedcostefficiencyofthemarketsectorvirtually means compression of the market charges assuming that the quality of the marketing services performed remains the same. This would motivate expansion of the output in the production sector through higher prices and liberation of consumer’s income for other purpose through lower prices.
In practice,however, we observethat marketing charges are very sticky, even in economies experiencing high rates of growth. Such stickiness in part is due to increased sophistication in the consumer’s wants requiring successively better quality marketing services and an increased degree of processing of the raw materials used to produce the final commodities. It is difficult to evaluate changes in cost efficiency because the quality of output changes over time reacting to the consumer’s wants. Marketing in developed countries has been characterised by a rapid change towards lower cost or better quality services.
The earnings of labour per unit of time have increased, the total labour force decreased, and expense for machines, equipment, and facilities increased. Historical and comparative analysis gives a clear idea that marketing plays a very important role in the growth of country’s economy and individual’s standard of living. Assignment QP September 2009
 Everton R. de Lins (1970, p 20-30). , Marketing in economic development, Chapter II Marketing and Development.
 Philip Kotler (1999), “Marketing Management (Millennium Edition)”.
 Kalman Appalbaum (2003, p 75-119)., “The Marketing Era ”, Global Marketing Practice.
 Elliott Ettenberg (2002, p 27-49). , “The Next Economy 2002”, The Marketing Impotence.
 Clarence J. Miller (1967), “Marketing and Economic development”.
 James E. Littlefield, Magdolna Csath (1988), “Marketing and economic development: Issues and Opinions”.
 Gordon Whitford Smith (1985), “International Debt and Developing Countries”.
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 The Marketing Segmentation, Narayana Rao K. V. S. S. [Last Updated 15/04/2005]. Available at: http://knol. google. com/k/narayana-rao-kvss/market-segmentation-and-select ion-of/2utb2lsm2k7a/128 [Accessed on 28/07/2009]. PAGE 10 OF 11 BA602 Assignment QP September 2009
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