The French businessman J B Say had postulated that supply can create its own demand (Blaug, 1997). He said that if goods are produced and supplied in a market, the market would automatically clear it up by creating demand for those goods. This law was given in the nineteenth century and has been proved redundant by Keynes and his followers. While this may be true in the macroeconomic sense, it cannot be discarded completely in the microeconomic sense. In the modern day context, supply alone however cannot be liable for creating demand. Since there are so many similar products in the market now that relying alone on supply will not yield the desirable result. However, supply preceded or proceeded by apt marketing strategy definitely helps. The modern day Say’s law hence has become “marketing (not supply) creates demand”.
McKenna (1991) writes that in the modern day, “marketing is everything and everything is marketing”. It is the new way of doing business which makes you own the business and not just do it. Thus marketing is the new way of creating demand. It is a more advanced form of advertising which creates a dialogue between the company and the customer to make the former understand what the customer really wants thereby fulfilling their needs.
It is important here to distinguish between marketing and advertising. Advertising is the old way of marketing wherein the producers create a monologue between the buyer and the seller to showcase the features of the product (McKenna, 1991). Marketing on the other hand is the trick to make customers realize that they really need the product. Marketing is the way of demand creation (Slywotzky, 2011) whereas advertisement is now merely the means to fulfill the existing demand (Fou, 2009).