We have introduced the concepts of Marketing 4.0 and 5A so far. You have seen that the definition of the term “marketing” has changed over time, and its framework continues to evolve. This article looks back at the birth of the concept of marketing leading up to Marketing 4.0.
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The 1900s-1960s Marketing 1.0 “Product Orientation”
The term “marketing” originated at the end of the 19th century and was only recognized in the early 20th century. Starting with the Industrial Revolution that took place in the United Kingdom from the mid-18th to 19th centuries, mass production and mass consumption of industrial products became possible. At this time, demand overwhelmingly exceeded supply, so it was a time when mass production of products at low cost was all that was needed to sell them.
Unlike the British colonies, the U.S. had to sell its products in a vast country, and since each region had a different climate, climate, and people’s sense of values, it naturally had to come up with sales plans and sales methods that were tailored to each region.
In other words, to efficiently mass produce products and deliver them to consumers, it was necessary to analyze the market and consumers and formulate strategies to suit them. It is through this process that the term “marketing” was born.
The emergence of the 4P Analysis Framework
In the 1950s, the marketing mix method of combining various means was popularized, and in the 1960s, the “4P analysis” framework, which is still the foundation of marketing today, was born. The most important questions for a company are what kind of product, how to distribute it（place）, at what price, and how to promote it.
Kotler positions marketing at this time as “product-centered marketing” that was “product-oriented” and focused on “product management for product sales”.
The 1970s-1980s Marketing 2.0 “Customer Orientation”
In the 1970s, the economy became more affluent and the balance of power between sellers and buyers changed dramatically. The market will also become increasingly price-competitive and flooded with similar products and imitations. Consumers will choose products that meet their needs from similar products, and the era of seller-dominated “just making a cheap product and those can be sold” will come to an end.
Kotler named this era of marketing “Marketing 2.0” and described it as “customer-oriented” and “strategically seeking customer satisfaction/customer management”. In Marketing 2.0, the emphasis has shifted from simply selling products at a low price to finding out what the buyer needs, in other words, it has become more important to examine the buyer’s diversifying “needs”.
Therefore, it has become essential for companies to have a marketing strategy to determine what kind of needs and at what scale customers exist, and to develop products that target people with those needs.
The emergence of the P-analysis Framework
In other words, the “STP analysis” framework advocated by Kotler is a good example of this. STP analysis” is a method of exploring customer needs from three perspectives: Segmentation = dividing the market according to needs, Targeting = determining the market to target, and Positioning = clarifying the company’s position in the market. A product that sells to everyone looks good, but from the buyer’s point of view, it is difficult to find value in it and lacks interest. Thus, companies are now focusing on how to differentiate themselves from their competitors.
Furthermore, as a result of supply catching up with supply and the phenomenon of a surplus of goods, people began to have a psychological tendency to dislike things that are the same as other people. This has also made it necessary for companies to make proactive proposals to customers who are looking for a sense of themselves.
The 1990s-2000s Marketing 3.0 “Human Orientation”
It is said that the development of social media, the emergence of social issues, and the maturation of the market are the three main reasons behind the emergence of the Marketing 3.0 concept since 1990.
With the advent of the Internet, also known as the Third Industrial Revolution, and the development of social networking services such as Facebook and Twitter, people now have access to a wide range of information, from positive to negative, ranging from product reviews to information about companies that make products.
And as environmental destruction and various social problems such as inequality became more serious, the attitude and vision of companies came to be questioned. Therefore, it can be said that consumers are increasingly choosing companies that are socially supportable when similar products are on the market.
As social and spiritual values have taken on greater significance today, corporate social responsibility to “make the world a better place” has become a top priority in marketing.
What are the three important elements 3i in Marketing 3.0?
In Marketing 3.0, companies are now evaluated under the framework of the “3i Model,” which looks at three aspects: positioning, brand, and differentiation.
Brand Identity
It consists of “positioning” and “brand” and refers to the position of a product in the consumer’s mind. Unique positioning is preferred.
Brand Image
It consists of “branding” and “differentiation,” and refers to creating a positive impression with consumers and satisfying their emotional needs. Brand Image, in other words, is the mainstay of Marketing 2.0: STP and Branding.
Brand Integrity
It consists of “differentiation” and “positioning,” which implies integrity to the brand. If the brand does not deliver on its promise, new technologies such as social media will expose the brand’s lies.
In conventional marketing, customers have been treated as mere “machines” that purchase products and services. However, Kotler points out that from now on, “co-creating” value in the world with consumers, who are “holistic beings” with minds and hearts, is what will ultimately lead to sales of a company’s products.
How has the customer journey changed with Marketing 4.0 4A to 5A?