Tuesday, May 20, 2008

The Economy of marketing!

Call it a 4P, 3C (alright, i have learned ABC new way:)). And then its about MR= MC. Interesting is the fact that marketing exploits all the constraints that economics puts in books. If economics says that price should be constant if many players stay in market, marketing says that you differentiate and create a new market. If economics says that you can at max value your product based on consumer surplus available, marketing says call it value based pricing and forget that there was ever a slanting line which said consumer surplus existed. So, i am loving it. The point is, i never believed in constraints. So, i go with marketing. I agree that nature will find its balance and finally economics principles will even out the playing field, only to make a firm move into new market and create a new imbalance. After all, business is all about generating values out of gaps, the moment equillibrium is achieved, business stops making sense. Business in every form is dynamic, fast moving, and opportunistic. The knowledge of constraints just lets you know, till when can you survive in same game. Given globalization and competition, economies achieve equllibrium faster, and hence the survival of business is becoming more and more challenging.

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