In past ample of definition of ‘Marketing’ has been highlighted, few of them are as below:
“The activity, set of institutions, and processes for creating, communicating,delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.- American Marketing Association
“The management process responsible for identifying, anticipating and satisfying customer requirements profitably.- Chartered Institute of Marketing
However, Marketing is the science and art of exploring, creating, and delivering value to satisfy the needs of a target market at a profit. Marketing identifies unfulfilled needs and desires. It defines, measures and quantifies the size of the identified market and the profit potential. It pinpoints which segments the company is capable of serving best and it designs and promotes the appropriate products and services.
Marketing is often performed by a department within the organization. This is both good and bad. It’s good because it unites a group of trained people who focus on the marketing task. It’s bad because marketing activities should not be carried out in a single department but they should be manifest in all the activities of the organization.
Marketing is everything a company does to acquire customers and maintain a relationship with them. Even the small tasks like writing thank-you letters, playing golf with a prospective client, returning calls promptly and meeting with a past client for coffee can be thought of as marketing. The ultimate goal of marketing is to match a company’s products and services to the people who need and want them, thereby ensuring profitability.
The four P’s of marketing are product, place, price and promotion.
Product refers to an item or items a business intends to sell. When examining a product, questions should be asked such as, what product is being sold? What differentiates the product from its competitors? Can the product be marketed with a secondary product? And are there substitute products in the market?
Price refers to how much the product is likely to cost. When establishing price, considerations needs to be given to cost the unit cost price, marketing costs and distribution expenses.
Place refers to distribution of the product. Key considerations include whether the product is going to be sold through a physical store front, online or made available through both distribution channels?
Finally, promotion refers to the integrated marketing communications campaign. Promotional activities may include advertising, personal selling, sales promotions, public relations, direct marketing, sponsorship and guerrilla marketing. Promotions are likely to vary being dependent on what stage of product life cycle the product is currently in. Marketers must be aware that consumers associate a product’s price and distribution with its quality, and would be prudent to take this into account when devising the overall marketing strategy.
These four elements are often referred to as the marketing mix,which a marketer can use to craft a marketing plan.
The four Ps model is most useful when marketing low value consumer products. Industrial products, services, high value consumer products require adjustments to this model. Services marketing must account for the unique nature of services.
Industrial or B2B marketing must account for the long term contractual agreements that are typical in supply chain transactions. Relationship marketing attempts to do this by looking at marketing from a long term relationship perspective rather than individual transactions.
As a counter to this, Morgan, in Riding the Waves of Change (Jossey-Bass, 1988), suggests that one of the greatest limitations of the 4 Ps approach “is that it unconsciously emphasizes the inside–out view (looking from the company outwards), whereas the essence of marketing should be the outside–in approach”.
In order to recognize the different aspects of selling services, as opposed to Products, a further three Ps were added to make a range of Seven Ps for service industries:
Process – the way in which orders are handled, customers are satisfied and the service is delivered.
Physical Evidence – is tangible evidence of the service customers will receive (for example a holiday brochure).
People – the people meeting and dealing with the customers.
As markets have become more satisfied, the 7 Ps have become relevant to those companies selling products, as well as those solely involved with services: customers now differentiate between sellers of goods by the service they receive in the process from the people involved.
Some authors cite a further P – Packaging – this is thought by many to be part of Product, but in certain markets (Japan, China for example) and with certain products (perfume, cosmetics) the packaging of a product has a greater importance – maybe even than the product itself.
Marketing is not Sales
Marketing is a terribly misunderstood subject in business circles and in the public’s mind. Companies think that marketing exists to support manufacturing, to get rid of the company’s products. The truth is the reverse, that manufacturing exists to support marketing. The company can always outsource its manufacturing. What makes a company is its marketing offerings and ideas. Manufacturing, purchasing, R&D, finance and the other company functions exist to support the company’s work in the customer marketplace.
Marketing is too often confused with selling. Selling is only the tip of the marketing iceberg. What is unseen is the extensive market investigation, the research and development of appropriate products, the challenge of pricing them right, of opening up distribution, and of letting the market know about the product. Thus, Marketing is a far more comprehensive process than selling.
Marketing and selling are almost opposites. Hard sell marketing is a contradiction. Long ago I said: “Marketing is not the art of finding clever ways to dispose of what you make. Marketing is the art of creating genuine customer value. It is the art of helping your customers become better off. The marketer’s watchwords are quality, service, and value.”
Selling starts only when you have a product. Marketing starts before there is a product. Marketing is the homework the company does to figure out what people need and what the company should make. Marketing determines how to launch, price, distribute and promote the product/service offering in the marketplace. Marketing then monitors the results and improves the offering over time. Marketing also decides when to end the offering.
All said, marketing is not a short-term selling effort but a long-term investment effort. When marketing is done well, it occurs before the company makes any product or enters any market; and it continues long after the sale.
Modern Concept of Marketing
The modern concept of marketing considers the consumers’ wants and needs as the guiding spirit and focuses on the delivery of such goods and services that can satisfy those needs most effectively. Thus, marketing starts with identifying consumer needs, then plan the production of goods and services accordingly to provide him the maximum satisfaction. In other words, the products and services are planned according to the needs of the customers rather than according to the availability of materials and machinery. Not only that, all activities (manufacturing, research and development, quality control, distribution, selling etc.) are directed to satisfy the consumers. Thus, the main implications of the modern concepts are:
(a) The focus of this concept is on customer orientation. The marketing activity starts with an assessment of the customers needs and plan the production of items that satisfy these needs most effectively. This also applies to all other marketing activities like pricing, packaging, distribution and sales promotion.
(b) All marketing activities like product planning, pricing, packaging, distribution and sales promotion are combined into one as coordinated marketing efforts. This is called integrating marketing. It implies:
(i) developing a product that can satisfy the needs of the consumers;
(ii) taking promotional measures so that consumers come to know about the products, its features, quality, availability etc.;
(iii) pricing the product keeping in mind the target consumers’ purchasing power and willingness to pay;
(iv) packaging and grading the product to make it more attractive and undertaking sales promotion measures to motivate consumers to buy the product; and
(v) taking various other measures (e.g., after sales service) to satisfy the consumers’ needs.
(c) The main aim of all effort is to earn profit through maximization of customer satisfaction. This implies that, if the customers are satisfied, they will continue to buy, and many new customers will be added. This will lead to increased sales and so also the profits. Modern Concept of Marketing
Focus on –> Customers’ need.
Means –> Coordinated marketing efforts
Ends –> Profits through customers’ satisfaction
It may be noted that with growing awareness of the social relevance of business, marketing has to take into account the social needs and ensure that while enhancing consumer satisfaction, it also aims at society’s long-term interest.
Importance of Marketing
Marketing is important to the business, consumer as well as the society. This is evident from the following points.
(a) Marketing helps business to keep pace with the changing tastes, fashions, preferences of the customers. It works out primarily because ascertaining consumer needs and wants is a regular phenomenon and improvement in existing products and introduction of new product keeps on taking place. Marketing thus, contributes to providing better products and services to the consumers and improve their standard of living.
(b) Marketing helps in making products available at all places and throughout the year. We are able to get Kashmir shawls and Assam Tea all over India and get seasonal fruits like apple and oranges round the year due to proper warehousing or proper packaging. Thus, marketing creates time and place utilities.
(c) Marketing plays an important role in the development of the economy. Various functions and sub-functions of marketing like advertising, personal selling, packaging, transportation, etc. generate employment for a large number of people, and accelerate growth of business.
(d) Marketing helps the business in increasing its sales volume, generating revenue and ensuring its success in the long run.
(e) Marketing also helps the business in meeting competition most effectively
Objective of Marketing
After knowing the points of importance of marketing let us discuss on the basic objectives of marketing.
(a) Provide satisfaction to customers: All marketing activities are directed towards customer satisfaction. Marketing starts with ascertaining consumer needs and produce goods that satisfy those needs most effectively. Not only that the pricing and distribution functions of marketing are also planned accordingly.
(b) Increase in demand: Through advertising and other sales promotional efforts, marketing aims at creating additional demand for their products. Satisfied customers also help in creating new customers. For example, if you buy a ‘gel pen’ and feel satisfied, next time also you will buy the same pen and obviously when you tell others about it they will also feel like giving it a try.
(c) Provide better quality product to the customers: This is a basic objective of marketing. The business houses try to update and upgrade their knowledge and technology to continuously provide better products. If they do not do so, they will be phased out through competition.
(d) Create goodwill for the organisation: Another objective of marketing is to build a good public image and create goodwill for the organisation. This helps in maintaining loyalty to the product and accepting new products of the same company.
(e) Generate profitable sales volume: The ultimate objective of all marketing efforts is to generate profitable sales volumes for the business. Taking care of customer needs and wants by providing the required goods and services at prices they can afford, and at places and timing that are convenient to them ultimately lead to increased sales and profits.
Evolution of Marketing Concepts
Here is a brief overview of the evolution of marketing concepts.
Production concept – an operations-based concept where the consumer expects products that are easily available and affordable.Here the business focuses on production efficiency, lowering costs and mass distribution. This concept works in developing economies where the need is more for the product than the features it offers.
Product concept – a consumer oriented concept where consumers expect products that are superior, high-performance and with unique features. This concept assumes that customers are likelier to be loyal when the product meets all their expectations and so, the business strives to offer innovative products consistently.
Selling concept– where the business believes that its products will sell only through active promotion and selling and the customer will not respond until pushed.In short, it is a matter of the business trying to sell what it makes rather than make products to meet the market’s needs.
Marketing concept – This concept is radical, compared to the above and focuses on the target market, its needs and wants and a desire to be better than the competition while delivering value to its market. Unlike the earlier concepts that rely on push marketing, it believes in pull marketing by creating brand loyalty.
While the sales concept is seller-oriented, the marketing concept is buyer-oriented.
A fifth concept has evolved today, the societal marketing concept – is the ideal situation where, along with the focus on the target market’s wants and needs and delivering better value than its competition, the business also strives to preserve the well-being of its target market and the society as a whole.This takes into consideration environmental and natural resource preservation and minimizing the carbon footprint.
Important Functions of Marketing
Marketing is related to the exchange of goods and services. Through its medium the goods and services are brought to the place of consumption. This satisfies the needs of the customers. The following activities are undertaken in respect of the exchange of goods and services:
1. Gathering and Analysing Market Information: Gathering and analyzing market information is an important function of marketing. Under it, an effort is made to understand the consumer thoroughly in the following ways:
(a) What do the consumers want?
(b) In what quantity?
(c) At what price?
(d) When do they want (it)?
(e) What kind of advertisement do they like?
(f) Where do they want (it)?
What kind of distribution system do they like? All the relevant information about the consumer is collected and analysed. On the basis of this analysis an effort is made to find out as to which product has the best opportunities in the market.
2. Marketing Planning: In order to achieve the objectives of an organisation with regard to its marketing, the marketeer chalks out his marketing plan. For example, a company has a 25% market share of a particular product.The company wants to raise it to 40%. In order to achieve this objective the marketer has to prepare a plan in respect of the level of production and promotion efforts. It will also be decided as to who will do what, when and how. To do this is known as marketing planning.
3. Product Designing and Development: Product designing plays an important role in product selling. The company whose product is better and attractively designed sells more than the product of a company whose design happens to be weak and unattractive. In this way, it can be said that the possession of a special design affords a company to a competitive advantage. It is important to remember that it is not sufficient to prepare a design in respect of a product, but it is more important to develop it continuously.
4. Standardization and Grading: Standardization refers to determining of standard regarding size, quality, design, weight, colour, raw material to be used, etc., in respect of a particular product. By doing so, it is ascertained that the given product will have some peculiarities.This way, sale is made possible on the basis of samples. Mostly, it is the practice that the traders look at the samples and place purchase order for a large quantity of the product concerned. The basis of it is that goods supplied conform to the same standard as shown in the sample.
Products having the same characteristics (or standard) are placed in a given category or grade. This placing is called grading. For example, a company produces commodity – X, having three grades, namely A’. ‘B’ and ‘C’, representing three levels of quality; best, medium and ordinary respectively.Customers who want best quality will be shown ‘A’ grade product. This way, the customer will have no doubt in his mind that a low grade product has been palmed off to him. Grading, therefore, makes sale-purchase easy. Grading process is mostly used in case of agricultural products like food grains, cotton, tobacco, apples, mangoes, etc.
5. Packaging and Labelling: Packaging aims at avoiding breakage, damage, destruction, etc., of the goods during transit and storage. Packaging facilitates handling, lifting, conveying of the goods. Many a time, customers demand goods in different quantities. It necessitates special packaging. Packing material includes bottles, canister, plastic bags, tin or wooden boxes, jute bags etc.
Label is a slip which is found on the product itself or on the package providing all the information regarding the product and its producer. This can either be in the form of a cover or a seal. For example, the name of the medicine on its bottle along with the manufacturer’s name, the formula used for making the medicine, date of manufacturing, expiry date, batch no., price etc., are printed on the slip thereby giving all the information regarding the medicine to the consumer. The slip carrying all these is details called Label and the process of preparing it as Labelling.
6. Branding: Every producer/seller wants that his product should have special identity in the market. In order to realise his wish he has to give a name to his product which has to be distinct from other competitors.Giving of distinct name to one’s product is called branding. Thus, the objective of branding is to show that the products of a given company are different from that of the competitors, so that it has its own identity.
For instance, if a company wants to popularise its commodity – X under the name of “777” (triple seven) then its brand will be called “777”. It is possible that another company is selling a similar commodity under AAA (Triple ‘A’) brand name.Under these circumstances, both the companies will succeed in establishing a distinct identity of their products in the market. When a brand is not registered under the trade Mark Act, 1999, it becomes a Trade Mark.
7. Customer Support Service: Customer is the king of market. Therefore, it is one of the chief functions of marketer to offer every possible help to the customers. A marketer offers primarily the following services to the customers:
(ii) Handling customers’ complaints
(iii) Technical services
(iv) Credit facilities
(v) Maintenance services
Helping the customer in this way offers him satisfaction and in today’s competitive age customer’s satisfaction happens to be the top-most priority. This encourages a customer’s attachment to a particular product and he starts buying that product time and again.
8. Pricing of Products: It is the most important function of a marketing manager to fix price of a product. The price of a product is affected by its cost, rate of profit, price of competing product, policy of the government, etc. The price of a product should be fixed in a manner that it should not appear to be too high and at the same time it should earn enough profit for the organisation.
9. Promotion: Promotion means informing the consumers about the products of the company and encouraging them to buy these products. There are four methods of promotion: (i) Advertising, (ii) Personal selling, (iii) Sales promotion and (iv) Publicity. Every decision taken by the marketer in this respect affects the sales. These decisions are taken keeping in view the budget of the company.
10. Physical Distribution: Under this function of marketing the decision about carrying things from the place of production to the place of consumption is taken into account. To accomplish this task, decision about four factors are taken. They are: (i) Transportation, (ii) Inventory, (iii) Warehousing and (iv) Order Processing. Physical distribution, by taking things, at the right place and at the right time creates time and place utility.
11. Transportation: Production, sale and consumption-all the three activities need not be at one place. Had it been so, transportation of goods for physical distribution would have become irrelevant. But generally it is not possible. Production is carried out at one place, sale at another place and consumption at yet another place.
Transport facility is needed for the produced goods to reach the hands of consumers. So the enterprise must have an easy access to means of transportation.Mostly we see on the road side’s private vehicles belonging to Pepsi, Coca Cola, LML, Britannia, etc. These private carriers are the living examples of transportation function of marketing. Place utility is thus created by transportation activity.
12. Storage or Warehousing: There is a time-lag between the purchase or production of goods and their sale. It is very essential to store the goods at a safe place during this time-interval. Godowns are used for this purpose. Keeping of goods in godowns till the same are sold is called storage.For the marketing manager storage is an important function. Any negligence on his part may damage the entire stock. Time utility is thus created by storage activity.
“Marketing library resources – content, knowledge databases – CIM”. Retrieved 16 March 2017.
Marketing definition approved in October 2007 by the American Marketing Association:
The Concept of the Marketing Mix” from the Journal of Advertising Research, June 1964 pp 2-7