Concept of Marketing: Need, Wants and Demands, Transactions, Transfer and exchanges

Need, Wants and Demands

Marketing is the process of fulfilling the needs and wants of the consumers. This is why people get attracted to this process. All the people have almost the same needs but their wants happen to be different.

Human wants the other marketing concept means the conversion of needs to some tangible product or service. This conversion depends on the personality of the individual or his culture.

If wants for specific products are backed by purchasing power and willingness to buy, we call them demands. You know that wants are unlimited where resources are limited, and hence people always buy those goods that provide them maximum satisfaction. It implies that people do not buy and cannot afford to buy everything they want.

For example, many persons want the latest model Toyota car, but only a few will be willing and able to buy one of these cars.

As a marketer, you should, therefore, identify basically how many people would actually be willing and able to buy your product, not how many want it, since this is less important to you.

Transactions

Whereas exchange is the core concept of marketing, a transaction is marketing’s unit of measurement. The transaction is a trade between two parties that involves at least two things of value, agreed-upon conditions, a time of the agreement, and a place of agreement.

A transaction takes place if an agreement is reached between two parties involved in the exchange. You should know that unless two parties negotiate and move toward an agreement, they are not engaged in exchange, and hence, an exchange is not an event; rather, it is a process.

The basic unit of exchange is a transaction, and it consists of a trade of values between two parties involved in the exchange. It means that both parties get something out of a transaction.

In the barter transaction, both parties receive goods or services as the trade of value, not money. Transactions lead marketers gradually to relationship marketing.

Transfer

Transfer involves obtaining something without any offer or offering anything without any return. For example, Mr. X gives gift to Mr. Y. Transfer is a one-way process. But pure transfer is hardly found in practice. One transfers something with some unexpressed expectations. Offer of money to beggar is to get the favour of God.

Donor gives donations and receives honour, appreciation, and special invitation, or even special influence in administration. Gift is rewarded in terms of gratitude, a good behaviour, saying, “thank you” or with the expectation that the receiver of the gift will offer the same in the future. Almost all transfers are same as transactions. Transfer and transaction both are important for marketer.

Exchanges

Marketing takes place when people decide to satisfy needs and wants through exchange. Exchange is the act of obtaining a desired object from someone by offering something in return.

The exchange has many benefits;

• People don’t have to depend on others, and they must not necessarily possess the skills to produce everything they need.
• They can decide to produce things which they excel in and trade them for other goods produced by others.
• So, the exchange makes it possible to produce much more than it would have made with any other alternative system.

Several conditions must exist for an exchange to take place.

There should be at least two parties in exchange, and each must have something of value to the other.

Each party must have the desire to deal with other parties, and each must have the freedom to accept or reject the other’s offer.

Finally, each party must have the ability to communicate and deliver.

In reality, marketing emerges when people decide to satisfy their needs and wants through an exchange, we mean obtaining something (the desired object) by offering something in return from someone. In the contemporary world, the exchange is the only recognized way through which an individual can obtain his desired object, and hence it is considered the core concept of marketing.

Exchange cannot take place in isolation. Several conditions must be met for an exchange to take place.

• At least two parties must participate,
• Each must have something of value to the other,
• Each must also want to deal with the other party,
• Each must be free to accept or reject the other’s offer, and,
• Each of them must be able to communicate and deliver