Marketing is the process of:
Note that this definition includes controllable marketing factors, a product, uncontrollable marketing factors, and an exchange that results in satisfaction for both parties of the exchange.
Satisfaction to all parties should be the result of an exchange.
MARKETING MIX VARIABLES
These are directed toward a target market, which is a group of people or organizations at which the organization is aiming its products.
A market can be all actual and potential buyers of a product.
These 4Ps are the controllable factors in marketing because the marketer generally has direct control over the design of the product that is offered, the price level at which the prodcut is offered, the means and amount used in promoting the product, and ways that the product is distributed to reach its final consumer.
Entities such as people, places, and organizations can also be products. A political candidate provides promises of future performance in exchange for your vote. A country can promise low taxes and operating expenses to attract businesses which provide jobs.
These together make up the product offering.
E.g., the product offering of an automobile would include the core product of some bundle of tangible features at some price and the augmented product which includes the ministrations of the salesperson, the expectations that the particular dealership does good service work, the convenient location of the dealership, and such.
E.g., the core product of a life insurance policy includes a particular contractual agreement to provide so much death benefit, so much annuity value, etc. for some set price, but many products are purchased because buyers appreciate the trustworthiness of a particular sales agent, who is part of the augmented product.
Indeed, many products are differentiated not on the core features, but on the augmented features.
Products have features or attributes which provide benefits to the buyer. Note that benefits, not features, provide solutions to a buyer's needs. People buy a bundle of benefits, not features.
A reason that many people fail as salespeople is that they attempt to sell features rather than benefits.
The basic objectives of promotion are to:
Three engineers quit their jobs to start a company that made signs for fast food restaurants. They rented a building and designed and built the equipment to make signs. This effort, however, would not be enough to bring any new business to them. Fortunately, their friend Terry also quit his job to help found the company. Terry's role was to go out and find fast food restaurants that needed signs - e.g., those just under construction.
Many of the people that Terry found were restuarant owners who might possibly build another restaurant in the future. At first Terry needed to find and inform these people about what his company produced and how its products were different and, of course, better than those of competitors. If the restaurant owner just happened to need some new signage (e.g., additional menu signs inside the restaurant), then Terry could persuade them to make a purchase from his company. If the owner did not need any signage, Terry would nonetheless periodically make a call anyhow just to leave a reminder that his company should be considered if there ever is a need for some new signage.
push vs. pull promotional strategies
DISTRIBUTION: FUNCTIONAL INTERMEDIARIES
Customer satisfaction is the major aim of the marketing concept.
Therefore, the achievement of organizational goals depends on determining the needs and wants of current and prospective customers and delivering the desired satisfactions more effectively and efficiently than do competitors.
The idea is that a focus merely on, say, increasing sales, will not necessarily meet buyer needs, and could therefore result in decreased sales. E.g., promising unrealistic delivery schedules to institutional customers could increase sales in the sort run, but might ultimately chase away millions of dollars in future business from customers who no longer trust you.
On the other hand, a blind focus on customer satisfaction could result in putting the organization out of business. E.g., increasing quality and lowering prices might result in great customer satisfaction, but could also result in such high costs that the company can no longer pay shareholders and employees, or no longer has the profits to invest into the research and development of new products to replace older obsolete products.
Those entertaining dog-and-pony consultants who blindly preach "quality" and "give the customer what they want" are just as dangerous as the orgainzational "bean counters" with a cost-cutting production orientation. Neither understands the notion of the marketing concept.
PSEUDO EVOLUTION OF THE MARKETING ORIENTATION
Note that there is some controversy regarding the notion of eras in marketing. The idea is here considered to be conceptually useful, albeit without dates.
Geseppi was a furniture maker many years ago just as water powered machinery was being discovered. In the old days he could make about five chairs per week during a normal work week. When his son asked for pony for his sixteenth birthday, Geseppi couldn't afford it, so he worked a few extra hours every evening for a few weeks so that he could make an extra chair each week. By working a little longer, he could produce more, thereby generating higher profits.
Geseppi's son, Alvin, eventually went to college and earned an engineering degreee. For his senior internship project, Alvin developed a way to power wood working machinery with a water wheel. When this machinery was installed in Geseppi's shop, he was able to increase production to twenty five chairs per day. Unfortunately, he was now able to supply many more chairs than could be consumed locally, so Geseppi hired a sales representative to find new customers.
Herb, the sales rep, traveled to nearby cities where people very much needed new chairs. Geseppi hired a few more reps and found that he could increase sales simply by sending more reps to more distant cities.
Eventually, however, competitors began to install water powered chair making machinery and hired manufacturer's representatives to travel to distant cities to sell their chairs. Although there were still plenty of prospective buyers who needed chairs, these buyers now had choices. Selling more was no longer a matter of producing more or a matter of sending out more sales reps. It was now important to anticipate the needs of potential buyers before even making the product, thereby producing a product that best meets the needs of the buyer.
Geseppi's competitors were all selling black chairs, whereas Geseppi was selling red, yellow, and blue chairs after focus goup research indicated that these were the most favored colors of the day. Geseppi quickly cornered the chair market, thereby making greater profits which could in turn be used to pay higher salaries to employees such as his sales people. Competitors who maintained a mere production orientation or a selling orientation eventually declared bankruptcy.
During the evolution of an economy or social system, if there are not enough products available to meet consumer demand, organizations can produce whatever they want without regard to consumer needs (production orientation). But if prospective buyers have knowledge products and competition, as when sales people visit prospective buyers to promote competing products, then buyers with choices will buy the products which best suit their needs and wants (selling orientation). When prospective buyers have enough choices, only those organizations which can anticipate buyer needs before production will be able to make the best product at the lowest cost, and will, therefore, achieve higher sales (marketing orientation).
Most successful organizations in the U.S. now maintain a marketing orientation. Note, however, that it is possible in some situations to still hold a production or sales orientation.
we often have to explain to employees within the organization how and why it is that they perform important boundary spanning functions
Consider a visit to a bank in which the teller is not only rude, but makes a mistake. After a brief argument, you are able to convince the teller that a mistake has been made, but you receive no apology for the error. How are you likely to respond:
When we visit a bank, the teller is the bank in our perceptions at that point in time. All of that person's behaviors, good and bad, are ascribed to the institution. This person is a boundary spanner and plays a crucial role in our perceptions of the entire institution. When you call a large organization and reach a receptionist, the behaviors of that receptionist affect your perceptions of the entire organization - his or her voice and ability to respond to your request is the organization to you at the time. It makes absolutely no sense that the receptionist is generally one of the most mistreated and lowest paid employees of many organizations!
On the other hand, it is no wonder that many organizations have dress codes for salespeople and supply company cars. A salesperson who drives a sporty convertable might represent an image of youth, success, and quick response for one company, but might imply immaturity and inappropriate priorities to customers of another company. Whatever a sales representative does and says, s/he is the company whenever in contact with prospects and customers.