Defining marketing can vary from the practical to the long-winded and in some quarters even to the downright derogatory. But when interpretations and definitions settle into sound bites, the question remains; what does marketing really do?
What makes marketing one of the central functions in almost every successful business and one of the most popular career choices for graduates?
The roots of marketing
It was in the early 1930s in New York, when the subject of marketing was born with the founding of the American Marketing Society (AMS), a group made up of general business managers still smarting from the Wall Street Crash and Great Depression of the late 1920s. These enterprising businessmen were keen to develop their businesses by focusing development on sales and advertising.
Though the term marketing was born, the function didn’t fully come into its own until the mid 1950s/early 1960s with the technological advances of that era. It was the age when television was evolving from a basic news service to a colourful advertising medium, a time when the space age had people believing the impossible could happen, but more importantly from the business perspective, the 1960s allowed the masses to develop discerning minds and encouraged individualism, suddenly consumerism became a widespread phenomenon in the western world.
Where does marketing fit in?
For many functions it’s fairly easy to identify their purpose and to justify their existence within a company. Purchasing, buy materials/goods, production, make the products, then sales, sell them. It seems a very straightforward process and in many ways it is, until the big obstacle arrives – the competition. Competition in effect creates the need for marketing.
When a market becomes increasingly competitive, businesses have to ask:
- Who really are our customers?
- How can we understand them?
- What are their wants and needs?
- Where are they geographically?
- What do we have to buy, make or deliver to ensure our goods/services sell instead of competitors’ products?
- How can we ensure customers return and buy again?
When the questions start mounting and the answers prove more difficult to find – enter marketing.
To ensure a business runs smoothly and successfully, marketers have to work closely with practically every other function in a company. They have to understand the products or services the company produces and to appreciate what is required in terms of resources (human, financial, equipment etc) to develop and promote existing products and add new products to the portfolio.
In essence, the marketer has to discuss with and inform the rest of the company departments (and stakeholders, directors) about societal trends, consumer behaviour, and competitors’ activities. Once the key facts have been found, a marketer then has to lay viable plans to create promotional campaigns, new products/services within budgets, ensuring that they will satisfy customers and stakeholders alike.
It’s always a juggling task but without the marketing function most businesses struggle to survive nevermind compete.
Different types of marketing
One of the great things about marketing is the huge variety of work. There are so many different types of consumers and industries that marketers can enjoy working across many different sectors, from consumer durables such as fridges and washing machines to FMCGs (fast moving consumer goods) like fine wines or through to services such as travel and tourism.
Generally most marketers will market to two types of customer; to consumers known as B2C (business to consumer) or direct to businesses known as B2B (business to business). Many marketers will market to both types of buyers, but there are differences in approach and buyer behaviour to each type. One of the main differences being that consumers are spending their own money and the buying decision is more personal, however a buyer in a company is spending (investing) a company’s money for the benefit of the business. Marketers therefore have to tailor plans and strategies to both types of customer.
Products v services
The two commodities a company can produce and sell are products and services.
From a marketing perspective products tend to be easier simply because they are tangible and visible and are often evaluated at the point of purchase or on seeing an advertisement.
Services are a different story and service marketing is often far more difficult as the consumer can only truly evaluate a service once that service has been completed. Marketing services (especially financial services) though more challenging is often more rewarding.
Two levels of marketing
- Strategic – addresses the long-term goals of a company. It tends to focus on how an organisation competes against its competitors in a market place. In particular, it aims at creating a sustainable competitive advantage relative to its competitors. Often this includes auditing, researching and then delivering short and long-term plans that will steer a business to continued success.
- Operational – concerns the execution of the marketing functions at the tactical level. Its real purpose is to attract and retain customers at the sharp end of business – the customer’s buying decision. The operational level generally involves all the elements of the classical marketing mix, the four Ps – product, promotion, pricing and placement.