Marketing is nowadays an important aspect of every business. The price (and value) of a product or service increases on account of marketing concepts. Importance of marketing can be understood by the considerable influence it has on buying and selling behavior. People’s buying and selling behavior ultimately governs the market.Marketing concepts influence is due to multiple reasons. These reasons include competitive market structures (e.g., monopolistic competition, oligopoly, and niche markets), economical communication technology, information revolution, MNCs, globalization, battle for a competitive edge, and Brand Identity phenomenon.
Definition of Marketing
Marketing is the managerial effort through which products and services move from the producers to the consumers.
American Marketing Association offers the following formal definition: “Marketing is 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.”
Encyclopedia Britannica defines, “Marketing is the sum of activities involved in directing the flow of goods and services from producers to consumers.”
Philip Kotler, an American marketing author, consultant and professor, gives the shortest definition of marketing: “Meeting needs profitably.”
Behind Effective Marketing
Effective Marketing is marketing the right product or service in the right way, in the right place, at the right time, at the right price and making a profit in the process.
Marketing concepts are required for increasing sales and achieving a sustainable market segment for products or services. Normally, a customer gets satisfaction from the product or service. An entrepreneur gets profit from the sale. The business achieves reputation or goodwill. As a result, Effective Marketing materializes a reputable business, profitable sales, and satisfied customers.
Investigation of the demand behavior of the target market is the focal area of marketing. Consequently, marketing has two parents: economics and psychology.
Economic considerations of customers’ demand behavior are the pull or visible factors. Psychological leanings are the push or invisible factors. A marketing effort concentrates on the customers’ tendencies for psychological satisfaction. After a detailed observation of the target market, it designs multiple incentives for economic benefits for customers.
In short, an effective marketing approach accommodates economic rules of selling and buying, and psychological tendencies of sellers and buyers.
Why Should You Market Your Business?
There are seven major reasons for marketing:
- Inform the target market about your (new) product or service. (Product Awareness)
- Introduce the target market to your (new) business or brand. (Brand Awareness)
- Motivate and persuade the target market to actual buying. (Demand Creation)
- Create a stable customer account for your business. (Customer Loyalty)
- Attain sustainable competitive advantage in the market (Brand Positioning)
- Achieve reputation or goodwill in the minds of customers (Customer Perception)
- Realize Brand Equity ultimately.
This covers the entire experience of business interaction between the seller and the buyer. These seven reasons also define the major areas of effective marketing.
Now we discuss different types of marketing concepts.
Marketing vs. Selling
There are two aspects of effective marketing: selling and marketing. Sellers and marketers are perceptually two different groups of people in a marketing activity. They have distinct views and approach towards the customers.
Harvard’s Theodore Levitt drew a perceptive contrast between the selling and marketing concepts: “Selling focuses on the needs of the seller; marketing on the needs of the buyer. Selling is preoccupied with the seller’s need to convert his product into cash; marketing with the idea of satisfying the needs of the customer by means of the product and the whole cluster of things associated with creating, delivering, and finally consuming it.”
Strategic alignment between marketing and selling is vital for better results.
“A study from App Data Room and Marketo found that sales and marketing alignment can make an organization 67% better at closing deals, reduce friction by 108%, and generate 209% more value from marketing.”
Marketing vs. Branding
Branding is the marketing process by which a marketer or brand manager summarizes a company’s market reputation or perception into a single word or phrase or design.
American Marketing Association defines a brand as “a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.”
There is a well-known rule in marketing: “Sell what people are buying.” Similarly, there is a well-performing rule in branding: Brand the attributes that people love.
An established brand creates customer trust and emotional attachments with the target market. As a result, brands foster relationships (often emotional) among customers, products, and businesses. Branding can provide valuable benefits to your business such as:
- Premium pricing,
- Low promotion cost,
- Loyal customers, &
- Constantly growing market share.
In a nutshell, a branding effort ultimately enhances the Brand Equity of businesses.
Brand Equity is the brand’s power derived from the goodwill and name recognition that it has earned over time.
Brand Equity translates into higher sales volume and better profit margins against competing brands in the market. The vital strategic aspect of Brand Equity creation is internal branding. Internal branding consists of managerial activities and processes that help, inform and inspire employees about brands.
In a branding effort, a marketer or an entrepreneur adopts four perspectives for effective branding:
To ascertain the desirability of your products or services for the customers.
To improve, technically and aesthetically, presentation and delivery process of your products or services.
To understand and exploit the differentiability and parity content or feature of your products or services with respect to your competitors.
To work on the creation of possible Brand Equity.
In branding, you create a perception of your product and business in the minds of customers. In marketing, you motivate or persuade customers to actual buying.
Branding is who you are. Marketing is how you affect customers’ decision process.
“Branding or Brand Management is a communication function in marketing that includes analysis and planning on how that brand is positioned in the market, which targets public the brand is targeted at and maintaining a desired reputation of the brand.”
Marketing vs. Advertising
Marketing deals with multiple business efforts to realize Profitable Sales:
- Market research,
- Pricing & distribution of product or service,
- Selling, &
- Public relations.
Advertising is just one component of marketing. In advertising, an entrepreneur or business communicates to the target market about their products or services.
Advertising is defined as: “Any form of communication in the paid media.” The prominent advertising mediums are print media, electronic media, and social media.
Conceptually, marketing is the way or strategy to convince your potential customers that you have the right product or service for them. Advertising is the conversion of your marketing strategy into specific communication media.
In advertising, you tell potential customers about the existence and availability of the right product or service for them.
The greatest issue of present-day advertising is Cluttering. An Advertising Clutter refers to the excessive amount of ad messages consumers are exposed to on a daily basis. It is the responsibility of a marketer to manage the clutter. Clutter management means to find the right time and place to connect with target customers and to send compelling messages to them about your business and products or services.
Marketing vs. Networking
Networking is a systematic interaction with fellow human beings to exchange information and opportunities.
Business Networking is dynamically linked with effective marketing. Business networking is an outcome of the socio-economic interactions of an entrepreneur. The networking efforts shape a business circle.
A business cannot survive or flourish, at least with full potential, without proper interaction among all economic agents and stakeholders. Executives’ presence in a big socio-economic circle and related associations is important to realize effective business networking. Business networking, BtoB and BtoC, is a crucial aspect of effective marketing.
All Sides of Effective Marketing
Concisely speaking, effective marketing is a combination of networking, branding, marketing, advertising, and selling.
Networking earmarks areas of targeted customers. Branding prepares ground through shaping and reshaping of perceptions and emotions of prospective customers. Advertising informs customers about the product or service through multiple media. Marketing motivates customers towards buying. Finally, selling materializes the actual profitable sale.