Marketing Definition

Total words: 1593

Definition of Marketing

Marketing is a term that is used frequently. Generally, it is thought of as how a company advertises and sells their products or services, but upon reading several sources during the research phase of creating this paper, it was found that there are many more elements involved in marketing. Marketing goes way beyond advertising and selling; it is a focal point of a company that drives the direction the company takes.

According to Perreault, there are two definitions for marketing. The definition for micro-marketing was stated as the performance of activities that seek to accomplish an organization�s objectives by anticipating customer or client needs and directing a flow of need-satisfying goods and services from producer to customer or client (Perreault, 2004). This is different than the definition provided for macro-marketing which stated that it is a social process that directs an economy�s flow of goods and services from producers to consumers in a way that effectively matches supply and demand and accomplishes the objectives of society (Perreault, 2004).

The micro-marketing definition applies to the activities of a single company or organization while the macro-marketing definition involves how the whole marketing system works. Macro-marketing impacts society, as a whole. It looks at matching supply and demand within a society.

Interestingly, the American Marketing Association (AMA) recently changed their official definition of marketing in 2004. The first official definition of marketing surfaced back in 1935 and remained unchanged until 1985 when the AMA decided to revise the wording. In 2004, they decided to revise the definition again by declaring, Marketing is an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. (Marketing, 2004).

All of the above definitions make their points that organizations utilize marketing to maximize opportunities that would best transfer the goods and/or services the organization produces to a purchaser. The trick to this is to determine what the right mix of activities is needed to best accomplish the organization�s goals. This involves good marketing management.

Good marketing management requires properly aligning the four Ps of marketing to the organization�s goals. The four Ps of marketing are product, place, price and promotion. All of marketing encompasses these four areas.

When detailing the �Product� category of the four Ps, it refers to what would be transferred to the producer. It involves what to offer. Will it be a tangible good or a service? What features will it have? How do the features compare with competitors? The benefits of this product or service must be determined. The quality level is a factor that needs to be detailed. Some industries require much higher levels of quality assurance than others, so this is an important decision to weigh against the cost factors.

The industry the author�s company is involved in is becoming highly competitive, so the company decided that quality was an important factor in how they wished to distinguish themselves from their competitors. High levels of customer service and high visibility touch points with clients and their customers has set the author�s company apart from other companies in the same sector and, thusly, has brought national recognition for product and service excellence.

Accessories for the product or service must be decided upon when determining what product or service to offer. How the product or service is installed is an important decision as well. This may impact the number of employees needed to be hired to support this process as well as other infrastructure that may need to be put in place. What instructions as well as what formats are needed to accompany the product or service must be decided upon. Will the product have a warranty? What type of warranty? What monetary impact could that cause the organization if products or services wind up being sub-standard? Also, the product lines, packaging and how the company chooses to brand the product or service all must be decided on. These all fit under the �Products� umbrella.

Place, as it concerns marketing, relates to where the purchaser(s) may obtain the product or service in design. There are a number of factors that go into this decision. The objectives must be determined. Again, the industry the product or service is in may dictate the objective based on external requirements. In the case of the author�s company, the place was dictated based on the service provided by the company. The company, Healthways, offers fully subsidized fitness center memberships to clients, who are health plans or employer groups, to their members. In this situation, the options were to open up a fitness center chain or to sub-contract with existing fitness centers. The later was obviously the much more economically feasible path to follow.

The objectives may not always be based on external requirements. It may be an internal requirement based on any number of factors. The channel type, or channel of distribution, must be determined. How will this product get from point A to point B? The kinds of middlemen in the channel of distribution need to be decided upon as well as how they will be recruited. The channel must be managed, so this must be understood and brought into the mix. The market exposure must be factored in as well as the kinds and locations of the stores, if applicable. How the goods will be transported and stored are important factors that can heavily impact an organization�s profitability.

Promotion is the third of the four Ps and is the portion of a marketing mix that most people associate with marketing, itself. This deals with �telling and selling� the purchaser(s). To properly manage the promotion aspect of a marketing mix, there are a number of factors that must be handled well. The objectives of promotion must first be determined. The promotion blend, or how the word will be spread, is a major factor to determine. The blend will depend on the answers found in other research phases of determining how the organization wants to promote its product or service.

The sales staff must be organized. The organization must determine the kinds of salespeople, the number required, and how to select, train and motivate the sales staff. The success of most organizations depends on the quality of the sales staff, so this is a crucial step to take into consideration.

Advertising is a major factor in the �Promotion� category of the four Ps. The targets, the kinds of ads, the media type, the copy thrust and who will prepare the advertising are all important elements in advertising. These are the more traditional activities most people associate with marketing, but the true impact of the results can make or break a product or services existence.

Besides advertising, the organization must decide on the types of sales promotions they may have, if any, and what types of publicity they will target. The marketing manager must determine how to blend all these means of communication to best handled the organization�s objectives.

Price, the final P of the four Ps, like the other Ps, must take into consideration what the competition is doing. The marketing manager must assure the pricing objectives are aligned with the organization�s objectives. Flexibility must be factored into the pricing. Some products or services have very little pricing flexibility due to factors such as scarcity of the resources required to produce the product or service or because of high levels of competition that drives prices to a stable, low rate. In the case of the author�s company, pricing involves the size of the client, what they can and may bring to the contract and the level of service they require. In terms of competition, the author�s company does charge more for the deliverable, but the costs to clients also includes a much higher level of customer service than competitors.

The product�s life cycle is an important element when pricing because the desire is to assure a certain amount of revenue is received over the life cycle. To do so, the price must level out over the life cycle. This requires a good understanding of the supply and demand for a product at any given time during the life cycle.

Geographic terms may play a factor in the pricing of a product or service. Some areas of the country or the world will not be able to pay as much as others for a given product or service and this needs to be understood and brought into consideration when pricing. Also, it must be decided what if any discounts or allowances will be made.

As detailed above, marketing is much more than advertising and selling, although those are important factors. A marketing manager�s role requires a thorough understanding of how the organization operates, how their competitors operate and how the purchaser(s) think and operate. There are many factors that ultimately determine whether a product or service achieves the results and organization desired, so a marketing manager must be on his or her game to ensure optimizing the marketing mix on behalf of the organization.

References:
Perreault, William D., & McCarthy, E. Jerome, Jr. (2004). Basic Marketing: A Global
Managerial Approach, 15e. Retrieved February 27, 2007, from
https://ecampus.phoenix.edu/content/eBookLibrary/content/eReader.h
Marketing Power. (2007). Retrieved February 27, 2007, from
http://www.marketingpower.com/content24159.php

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