1. The primary or pre - industrial stage : The primary or pre industrial stage of economic development is identified largely by the features of primitive cultures. It is essentially an agrarian or backwoods economy, lacking the technology and production capacity to tap opportunities and supply most of the needs of man. This stage itself is made up of four developmental phases namely :
1. Pre-historic economy
2. Self-sufficiency
3. Barter
4. Early-monetized economies.
The pre-historic economy : In this type of economy, man depends mainly on water, game and fruit he can gather as he wanders from place to place. In many places this was at first a one- person type of economy this Robinson Crusoe - type of economy is a subsistence one and needs no exchange of goods and services Consequently marketing does not take place at the phase.
The Barter economy : As time goes on people begin to learn about the benefits or economies of division of labour and specialisation. When people concentrate on producing the things they are endowed best to do their productivity would increase. This will result in their producing more than what they require for themselves alone. The concentration on the production of one thing (specialisation) would also result in their lacking some things which they require in life. This would necessitate the exchanging what they have in excess for the items they lack. The desire for what one does not have and or the readiness to dispose of the items that one has a excess will lead to trading or exchange, which is the heart - beat of marketing. At the beginning of exchange, it is carried out through barter - the exchange of goods and services. At the onset of exchange by barter the goods produced and brought for exchange are usually the basic necessities which are common the people involved in the exchange at the onset are usually neighbours. As the span of goods and services needed for exchange increased and parties involved are far from one another the barter system became cumbersome.
The occurrence of double coincidence of wants, agreement on the standard of unit of value and transportation became very difficult. These and other problems necessitate the need for developing a better means of exchange. Though the use of barter as a means of exchange or trading is the beginning of marketing, it imposes a lot of limitations which prevents marketing activities from blooming. The goods and services for exchange are limited, the location of exchange parties is so much time-consuming, the distances to be covered how much restricted and transportation is very much cumbersome among other problems. They lack good means of storing wealth or surplus at this economic phase places much restriction on the desire to increase production. Because of these problems marketing is only carried out at a very low state under the barter economy.
The Early monetised economy : The introduction of money as a means of exchange unit of account and a store of value helps to solve the problem associated with barter-exchange economic system. It enables trading to take place among people living far and near. It's also enlarges the scope of goods and services to be traded upon. Small producers can now step up their production capacity and even produced in anticipation of future demand. Nevertheless, the crude technology being used places much limitations on the type quality and quantity of goods and services being produced. And the goods being produced at this phase are mainly those needed for survival. It is therefore not difficult for the producers to identify or anticipate needs of consumers. However as population increases and label becomes more specialised, the need for basic goods and services heighten and scarcity results. In order to meet up with the increased demand for goods and services, producers begin to look for the means to of increasing their production capacity and reducing their costs of production.
The products turned out at the phase of early monetised economy are usually relatively simple in technology. They are produced mainly by such craftmen as blacksmiths, weavers, woodworkers, tinkers, porters, masons, and artisans. Only simple inspections are required to ascertain the quality of those products. In addition scarcity of goods prevents prevails at this time because of population increase without a corresponding increase in production capacity. This creates a trading situation known as sellers markets, where consumers compete for goods which cannot go round. These factors (simplicity of product and sellers' markets) makes the marketing activities of producers and sellers to be mainly confided to transportation and pricing.
Marketing research, product research and development, material management, complex distribution agreement, promotion, customer service, merchandising and many other modern marketing activities are greatly lacking in the early monetised economies of pre industrial society.
The secondary or industrial stage :
The great pressure from consumers for increase in the quantity of goods and services supplied and the search by producers for better means of production lead to an industrial revolution. As the saying goes : "Necessity is the mother of invention" with improved technology, sophistication of the goods offered to the consumer and productive capacity of producers are greatly improved.
Factories are opened and many people who were hitherto engaged in agriculture become factory workers as productive capacity improves, further division of labour takes place and some people fashion for themselves the roles of helping producers to sell their output. Thus distribution becomes a business or profession. As time goes on more people enter into production with large capitals and an increase in production results. Supply begins to outstrip demand and goods are thereby piled up in warehouses. Sales became a major problem to producers and intermediaries. To solve this problem, promotional tools are developed and employed for purposes of encouraging consumers to buy. Producers also begin to brand there products in order to make promotions easy.
At this stage the major tasks of marketing are bringing products from different places to consumers in concentrated urban centres and encouraging them to buy more through promotional tools. The merchandise engaged in distribution are usually many in number but small in capacity of goods they carry. Promotion is done mainly by the means of aggressive sales promotion and personal selling. Towards the end of this economics stage, storage, materials, management, physical distribution, transportation, international marketing and marketing communication begin to receive serious attention as producers make efforts to bring the widened gap between them and consumers. This stage can be divided into three economic phases these are ;
i. Early capitalism. ii. Mass production and
iii. Surplus economy.
Early Capitalist : The increase in production and trading of surplus output that resulted from division of labour and specialisation affords some people the opportunity to create an accumulated capital or wealth for themselves. By re -investing their accumulated capital in building bigger factories in response to the increase in demand of goods, these people have to employ more people who specialise in wage employment. The social classes of capitalist and working class are created. Service industries also arise to provide two people such services as laundry and dry cleaning, haircut and hair treatment, sewing, house cleaning and fumigation and repairs among others. People have to buy this services which day till then provided by themselves because of the increasing specialisation of labour. The existence of social classes and commercialisation of services make production and distribution more complex. Production and distribution have to increase in scope so as to cater for the different classes of people.
No comments:
Post a Comment