Commerce · Lesson 11

Marketing, elements of management and e-commerce

JAMBWAECNECO

What the syllabus asks

JAMB: 12 Elements of business management (functions: planning, organising, staffing, coordinating, directing, controlling; principles of management; organisational structure: line, line and staff, functional, committee); 13 Elements of marketing (importance and functions; marketing concept; marketing mix; market segmentation; public relations and customer service); 1 & 15 E-commerce and ICT in business

WAEC: Marketing (meaning, concept, functions, marketing mix, market research, product life cycle, pricing, after-sales services); business management (functions, organisation charts); electronic commerce (meaning, types, merits, demerits, prospects in Nigeria)

NECO: Marketing (meaning, concept, functions, marketing mix, market research, product life cycle, pricing, after-sales services); business management (functions, organisation charts); electronic commerce (meaning, types, merits, demerits, prospects in Nigeria)

What you will learn

Define marketing and distinguish it from selling.
Explain the evolution of marketing concepts.
State the functions and importance of marketing.
Explain the elements of the marketing mix.
Describe the product life cycle and strategies at each stage.
Explain pricing methods and calculate cost-plus prices and break-even output.
Explain market research and market segmentation.
State the functions and principles of management.
Describe organisational structures and draw a simple organisation chart.
Explain e-commerce, its types, merits, challenges and prospects in Nigeria.

Key points

Marketing identifies, anticipates and satisfies customer needs profitably; it is wider than selling.
Concepts: production → product → selling → marketing → societal marketing.
Functions: buying, selling, transport, storage, standardisation and grading, packaging, financing, risk-bearing, market information, after-sales service.
Marketing mix: product, price, place, promotion (+ people, process, physical evidence for services).
Product classes: convenience, shopping, speciality, unsought; industrial goods.
Product life cycle: introduction, growth, maturity, decline; extension strategies delay decline.
Pricing: cost-plus, penetration, skimming, competitive, psychological, discrimination, loss leader.
Break-even = fixed costs ÷ (price − variable cost per unit); margin of safety = actual − break-even output.
Market research: primary (field) and secondary (desk). Segmentation: geographic, demographic, psychographic, behavioural.
Management functions: planning, organising, staffing, directing, coordinating, controlling.
Fayol’s principles include division of work, authority and responsibility, unity of command, unity of direction, scalar chain, equity, esprit de corps.
Structures: line, line and staff, functional, committee; delegation, span of control, centralisation.
Functional areas: production, purchasing, marketing, finance, HR, administration, R&D, ICT.
E-commerce types: B2C, B2B, C2C, B2G, m-commerce.
E-commerce merits: reach, low cost, convenience. Challenges in Nigeria: fraud, logistics, data costs, payments, trust.

Start here: Marketing: meaning and evolution of the concept

Marketing is the management process responsible for identifying, anticipating and satisfying customer requirements profitably. A garri processor in Ogun who finds out that city customers want clean, well-packaged garri in 1 kg bags, produces it, prices it right, distributes it to supermarkets and advertises it is practising marketing.

Marketing and selling

Selling	Marketing
Starts after production	Starts before production (research)
Focus on the seller’s need to convert goods into cash	Focus on the buyer’s needs
Short-term: make the sale	Long-term: satisfied, loyal customers
Part of marketing	Wider: research, product, price, place, promotion, after-sales

Evolution of marketing philosophies

Production concept: consumers want cheap, available products, so concentrate on efficient production ("we sell what we make"). Worked when demand exceeded supply.
Product concept: consumers want the best quality, so improve the product, sometimes ignoring what customers actually want.
Selling (sales) concept: customers will not buy enough unless persuaded, so emphasise aggressive selling and advertising.
Marketing concept: find out what customers want and produce it ("make what we can sell"); customer satisfaction leads to profit.
Societal marketing concept: satisfy customers while protecting society and the environment (e.g. biodegradable packaging, healthier products).

Importance of marketing

To the firm: increases sales and profit, guides production, builds brand loyalty, helps survival against competition. To consumers: products that meet needs, information, wider choice, convenience. To the economy: employment (sales, advertising, logistics), higher living standards, growth through demand for goods.

Worked example 11.1 (JAMB-style)

The philosophy that a firm should produce what customers want is the

A. production concept B. selling concept C. marketing concept D. product concept

Answer: C.

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Practice questions

1. Marketing includes

all activities that move goods from producer to consumer and satisfy needs
only advertising
only production
only selling

Show answer

A: all activities that move goods from producer to consumer and satisfy needs
Research, product, price, place and promotion.

2. The 4 Ps of the marketing mix are

people, process, profit and plan
packaging, price, profit and place
product, profit, people and promotion
product, price, place and promotion

Show answer

D: product, price, place and promotion
The traditional marketing mix.

3. Market research aims to

manufacture goods
reduce taxes
gather information about consumers and markets
fix government prices

Show answer

C: gather information about consumers and markets
It reduces the risk of failure.

4. Market segmentation means

setting one price
dividing a market into groups of similar buyers
selling only in one town
merging markets

Show answer

B: dividing a market into groups of similar buyers
By age, income, location, etc.

5. Packaging helps to

protect goods and attract buyers
raise taxes
reduce product quality
replace advertising entirely

Show answer

A: protect goods and attract buyers
It also carries information.

Key words

Marketing: The management process of identifying, anticipating and satisfying customer requirements profitably.
Marketing concept: The philosophy that a firm achieves its goals by finding out and satisfying customers’ needs better than competitors.
Societal marketing concept: Satisfying customers in ways that also preserve or enhance the well-being of society.
Marketing mix: The set of controllable tools (product, price, place, promotion) a firm uses to reach its target market.
Market research: The systematic gathering, recording and analysis of data about markets, customers and competitors.
Market segmentation: Dividing a market into distinct groups of buyers with similar needs or characteristics.
Target market: The segment(s) a firm chooses to serve.
Product life cycle: The stages a product passes through: introduction, growth, maturity and decline.
Cost-plus pricing: Setting price by adding a percentage mark-up to unit cost.
Penetration pricing: Setting a low initial price to win a large market share quickly.
Price skimming: Setting a high initial price for a new product, then lowering it over time.
Psychological pricing: Setting prices just below round figures, e.g. ₦4,999.

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