Advantages and Disadvantages of Having a Marketing Orientation in an Organization

A business is considered marketing-oriented when its organizational strategy focuses on meeting the needs and wants of its customers. New products are developed and introduced only after first determining what the customers want. This approach contrasts with the product-oriented strategy, commonly found in industries that produce technological and electronic goods, which emphasizes the development and differentiation of products.

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Marketing-oriented businesses are better able to address consumer demand for products and retain loyalty from their customers. However, closely following trends may result in lack of product differentiation.

Every business needs customers to thrive, and having a marketing orientation puts the customer demand front and center. Marketing-oriented businesses deliberately research, track and monitor customer preferences and demand trends. More importantly, these companies listen to their own customers. As a result, marketing-oriented companies are positioned to modify existing products and develop new ones with a built-in base of consumers who are ready and willing to buy. This eliminates wasted resources and lost time from producing items that move slowly — or not at all.

Creating satisfied customers takes more than products developed specifically to meet customer needs. Good customer service is a vital component in developing customer loyalty. Marketing-oriented companies are quick to detect, and therefore quicker to fix, problems customers might experience in using or getting service for their products.

Furthermore, marketing-oriented companies integrate their customer service and front-line sales staffs — who hear firsthand the good and bad opinions of customers —into the companies’ decision-making processes. When customers find a product that meets their needs, made by a company that stands behind the product and responds to customer input, the result is a loyal customer base that provides a competitive edge over companies lacking a strong customer focus.

Excessive adherence to the market and customer demand may lead a company to follow trends too closely, especially for producers of luxury or discretionary goods. This can lead to reduced ability of the company to differentiate its products from its competitors. For example, if the trend in women’s fashion watches favors a certain shape and metallic finish, watchmakers may start selling women’s watches with such similar appearance that they all look the same, resulting in loss of brand distinction. This may not be a problem for established brands, but it could hinder brand recognition for new companies entering the field.

Another problem is that customers may be fickle, following a trend closely for several years but then switching loyalty and buying power to the next new thing. Marketing-oriented companies that have invested research, development and production time in the original longstanding trend may be ill-equipped to make the shift when consumer preferences change.

To make it work, marketing-oriented companies must invest heavily in research to identify consumer needs and preferences. If a company does not have the necessary expertise in-house, it may need to hire a marketing research firm or consultant to carry out the work. Both in-house and consultant research is costly and time-consuming, which may be one reason why marketing orientation is more often found among large corporations.

Small businesses and startups usually do not have the capital to finance this level of research. However, small businesses and startups can still use informal types of market research. Simply asking for, and listening to, customer feedback can give a small business a good start toward becoming marketing-oriented.