production orientation definition: Difference Between Product Orientation and Production Orientation Chron com

Throughout the years, we’ve seen organizations shift from one approach to another to conform to the changes in consumer behavior. Intel Corp shifted from a product orientation to a market orientation approach in 2005 and introduced products that solve customer problems like computer crashes. The marketing orientation concept has evolved, and for decades, it has been the model of choice for businesses looking to establish brands that can compete for customer attention and loyalty.

Emphasises strategies and tactics that push people towards buying a product or service. Often, sales-oriented businesses aren’t focused on long-term results but rather on achieving immediate sales. The focus isn’t on determining consumer desires or catering to customers’ needs, but on building profit margins. Understanding your business orientation can help you effectively direct your efforts in product development, sales, and marketing.

A marketing orientation relies on a marketing message that educates or convinces potential customers to make a purchasing decision. A business with a product orientation directs its energy toward creating and marketing the highest-quality offerings. Such a company makes the assumption that the sales and marketing parts of the process will take care of themselves if the product is of high enough quality. These business orientations reflect changes in business and marketing thinking over the last century. Today, businesses can’t afford to concern themselves with manufacturing in-demand products at a low cost.

A production orientation offers the advantage of being reasonably straightforward as long as demand for your products remains consistent and strong. You simply make what you make, and customers reward your business for keeping prices low and making its offerings easily available. However, this business philosophy does come with some calculated risk and often added costs that come with manufacturing and marketing sustainable products and services.

Shedding some light on this choice can make your efforts more intentional and increase your odds of success. So, Production Orientation is the general approach of any business that is primarily concerned with manufacturing and production processes. We set the orientation of the product using the product orientation (see ).

• Netflix – though technically a service, Netflix made companies such as Blockbuster obsolete by giving consumers easy access to movies and television shows.
• Options that are not cost effective today may become quite possible down the line due to changes in technology, science, regulation or other market conditions.
• In other words, their operations can be defined as service businesses, with customer service at the forefront.
• In a marketing orientation model, a business focuses on identifying the wants and needs of its target audience and determining how many products it needs to make to satisfy those wants and needs.

When https://1investing.in/ perceive that a company consistently tries to solve its problems, they tend to reward that company by consistently buying its products. In a production-oriented model, a business focuses on making as many products as possible, at the lowest cost available. The demand is always high, and the goal is to keep pushing out quality products as cheaply as possible to maximize the profit margin. The main advantage of a production-oriented approach is that you are constantly revising and improving your product to be the best it can be at the lowest price possible.

The business then must determine how to meet customer expectations in the best way possible. It involves market research aimed at determining what consumers view as their immediate needs, primary concerns, or personal preferences within a particular product category. Whereas in a product-oriented approach, the company focuses on growing its customer base with a set of new products.

Identifying which approach best fits your business

You decide to align yourself with may depend on your company’s specific strengths, business goals, and target market demands. If you’re a small business, deciding which business orientation approach to take can be challenging. In a market orientation approach, the company focuses on customers, thus understanding them, to generate demand and distribution. Whereas product orientation is a marketing philosophy skewed toward developing high-quality products, to generate sales. Businesses that adopt this strategy focus on making better products to attract customers, rather than identifying the specific needs of their customers and building products to satisfy those needs.

Entrepreneurs create new businesses, taking on all the risks and rewards of the company. Guerrilla marketing is the use of novel or unexpected marketing and promotional techniques by a brand or business. Companies may also employ additional data analysis to reveal trends and consumer desires that are not specifically expressed.

Services

Yet another classic example is the Ford Motor Company, where Henry Ford had made only model of car in black colour irrespective of the perspectives of the consumer. Indeed, most considered his product a threat to the profitable vacuum bag market which was then worth around $500 million. However, the impetus for the company came in 1974 after eventual founder James Dyson experienced a loss of suction from his Hoover vacuum cleaner. Airbus commercial aircraft are made from premium materials and components to increase the two important metrics of performance and safety. Note that columnar structure in the selective responses for cardinal and oblique orientations appear to emerge simultaneously. The figure contains two types of squares, one type involving a black-to-gray gradient, and the other a white-to-gray gradient, in different diagonal orientations.

Although these concepts are closely related in that they both deal with the product you are selling to your targeted audience, you employ different strategies to achieve your desired goals. For example, product orientation requires a well-executed product-oriented marketing strategy, whereas professionals with expertise in mass manufacturing are typically involved in production orientation. It’s also important to understand that you will use different tools to achieve each of these goals.

This concept dominated the business landscape in the 1900s, where organizations focused heavily on the mass production of products. Emphasis was on streamlining the production process and concentrating on improving efficiencies, with little focus on consumers or anything else. Sampson Quain is an experienced content writer with a wide range of expertise in small business, digital marketing, SEO marketing, SEM marketing, and social media outreach. He has written primarily for the EHow brand of Demand Studios as well as business strategy sites such as Digital Authority.

However, this approach can be disadvantageous for a business whose product isn’t particularly unique or for a product whose virtues aren’t immediately apparent without a marketing campaign. Societal marketing is a philosophy that focuses on creating a favourable image of a brand or organisation to increase sales. It calls for socially and environmentally responsible marketing that sustainably meets consumer needs while, at the same time, considering how it benefits society as a whole. On the other hand, disadvantages include a loss of customer confidence, high costs, and the fact it’s not always sustainable in the long run. The fundamental tools of product orientation include product research, product development and product focus. At times, market orientation may reveal customer desires that are simply not cost-effective or practical to implement.

Two other types of strategies include market orientation and sales orientation. In a marketing orientation model, a business focuses on identifying the wants and needs of its target audience and determining how many products it needs to make to satisfy those wants and needs. Through the help of marketing people and market research, business owners that pursue this strategy let their customers dictate how many products they make and what type of products they develop. One notable production orientation example is fast food restaurant chains such as Burger King and McDonald’s, which focus on making thousands of burgers a day at a cheap price. If you own one of these franchises, your goal isn’t to sell the best-tasting burger in the industry; it’s to make a decent burger at an affordable price that will keep customers happy. Insurance agencies sell a wide variety of products without worrying about customer demand, because their focus is on offering good products at a price point that a majority of people will find appealing.

Advantages of Product Orientation

Development focused on market orientation puts consumers’ desires first, creating the product around their expressed needs and wants. This contrasts with product orientation, a business philosophy that emphasizes getting the consumer to become aware of and like the features and benefits of a particular product. Market orientation often includes improvements in customer service and product support geared to solving concerns raised by consumers.

• This is an example of a company that truly had built a better mousetrap and could disregard their customers’ needs and follow a production orientation.
• Robinhood – the Robinhood investing app revolutionized trading for the average investor by making the market more accessible.
• Emphasises strategies and tactics that push people towards buying a product or service.
• Regardless of the approach your organization takes, you can positively influence the effectiveness and efficiency of your teams through proper employee management and monitoring.
• Companies may also employ additional data analysis to reveal trends and consumer desires that are not specifically expressed.

A product orientation strategy also means that you must constantly keep pace with the changing needs of your customers. As a result, it’s difficult to succeed without a strong product-oriented marketing strategy. The main advantage of a product-oriented approach is that you will always be responsive to what your customers want, which can help your company create a profitable niche in your industry. While product orientation focuses on quality, production orientation stresses process or business model. A company with a production orientation may seek its competitive edge in its ability to manufacture its offerings more efficiently and cost effectively than its competition.

The product has to sell itself, with a strong emphasis on research and development. As a result, it is only essential in a small market situation and is frequently paired with market orientation to appeal to a broad market. Listening to the needs of the consumers helps a business create and develop a brand that customers can identify with. Customer focus – The customer is at the heart of corporate marketing strategies.

They can innovate with new technologies to address customer needs and generate market demand. This type of company believes that if they can make the best ‘mousetrap,’ their customers will come to them. Pre-crisis ideological allegiances and the historical performance records of the rival policy orientations determine baseline preferences.

This helps ensure customer satisfaction remains high with the company as a whole and promotes brand loyalty and positive word-of-mouth advertising. Product failure – the product orientation approach can be successful, but it is by no means infallible. With less credence given to consumer feedback, there is a risk the new product fails when released to the market. Ultimately, trends do sell, and some businesses make money by simply giving consumers what they asked for. Companies that adhere to a market orientation operate very differently than companies with a production orientation.

Because a corporation focuses solely on one product, the manufacturing process is more straightforward. Customers can tell you how to make your product through focus groups, questionnaires, polls, and other market research. Sign up today to enjoy all the tools, such as product roadmaps, team radar, integrations, product feedback, and so much more.

If you choose this production orientation definition, you don’t worry as much about your customers wants and needs as you do about making the highest-quality product as cheaply and quickly as possible. You do so with the belief that if you create a good product at an affordable price, your customers will buy it, regardless of whether it meets their every want and need. The most common types of business orientation are product orientation, production orientation, sales orientation and marketing orientation. Production orientation is a marketing strategy in which the company focuses on products rather than customers’ wants or desires.