Chapter 1: Introduction to Marketing
Introduction
Marketing, more than any other business function, deals with customers. The simplest definition is this one:
Marketing is engaging customers and managing profitable customer relationships. The twofold goal of
marketing is to attract new customers by promising superior value and to keep and grow current customers
by delivering value and satisfaction.
For example, Nike leaves its competitors in the dust by delivering on its promise to inspire and help
everyday athletes to “Just do it.” Amazon dominants the online marketplace by creating a world-class online
buying experience that helps customers to “find and discover anything they might want to buy online.”
Facebook has attracted more than 1.5 billion active web and mobile users worldwide by helping them to
“connect and share with the people in their lives.” And Coca-Cola has earned an impressive 49 percent
global share of the carbonated beverage market—more than twice Pepsi’s share—by fulfilling its “Taste
the Feeling” motto with products that provide “a simple pleasure that makes everyday moments more
special.”
Many people think it means the same as personal selling. Others think marketing is the same as personal
selling and advertising. Still others believe marketing has something to do with making products available
in stores, arranging displays, and maintaining inventories of products for future sales. Actually, marketing
includes all of these activities and more. Marketing has two facets. First, it is a philosophy, an attitude, a
perspective, or a management orientation that stresses customer satisfaction. Second, marketing is activities
and processes used to implement this philosophy.
Sound marketing is critical to the success of every organization. Marketing is all around you, in good old
traditional forms like in the abundance of products at your nearby shopping mall and the ads that fill your
TV screen, spice up your magazines, or stuff your mailbox and in a host of new forms, from websites and
mobile phone apps to videos and online social media. But in recent years, marketers have assembled a host
of new marketing approaches, everything from imaginative websites and smartphone apps to blogs, online
videos, and social media. Today’s marketers want to become a part of your life and enrich your experiences
with their brands. They want to help you live their brands. At home, at school, where you work, and where
you play, you see marketing in almost everything you do.
The History of the Evolution of Marketing
1. 1900-1910: Discovery Period - first marketing courses and publications appear. Academically,
research focused on the distribution system for agricultural products, although concepts and ideas drew
from or were based on economic principles related to distribution and international trade.
2. 1910-1920: The Conceptualization Period - as the name suggests, this was the decade when many
marketing concepts were first conceptualized, classified, and terms and designations defined. Ralph
Starr Butler and Arch W. Shaw are the pioneers assigning to marketing the responsibility, among others,
for coordinating the operations of production, distribution, and marketing, facilitation, or management
functions. Marketing thought was divided into three distinct major schools that would endure until the
1950s, which took different perspectives: (1) consumer goods, focused on products; (2) institutional,
which was interested in the types of institutions that interacted with the product; (3) functional, which
focused on the activities of the marketing process.
3. 1920-1930: Period of Integration - the principles of marketing are postulated and the concepts, ideas,
terms, and designations, as well as all the knowledge in the field, are integrated for the first time. The
designation appears for the first time in a book with the title “Principles of Marketing”.
4. 1930-1940: Developmental Period - specialized areas of marketing are developed, and research
continues in which hypothetical assumptions are verified and quantified; new directions emerge that
seek to explain what marketing is.
5. 1940-1950: Period of Re-evaluation - the traditional concepts, assumptions, and justifications inherent
to marketing are re-evaluated, recognizing the need to evaluate new paradigms and the relevance of
systematization of scientific knowledge. The concept of marketing planning and control emerges in this
period.
6. 1950-1960: Period of Reconceptualization - the traditional marketing paradigms are overcome by a
progressive interest focused on management decision-making processes, on the social aspect of
marketing, and on qualitative and quantitative analyses. New concepts are introduced from
management and other areas, especially the social sciences.
7. 1960-1970: Period of Differentiation - the expansion of concepts, ideas, and designations, as well as
marketing thinking, led to the integration of differentiating elements (management, holistic,
environment, systems, and internationalization) creating a discipline with a unique, different identity.
8. Since 1970: Socialization Period - the perception of marketing’s influence on society, in general,
determined a particular focus of the discipline on social aspects.
Defining Marketing
Marketing is about identifying and meeting human and social needs. One of the shortest good definitions
of marketing is “meeting needs profitably.” When Google recognized that people needed to more
effectively and efficiently access information on the Internet, it created a powerful search engine that
organized and prioritized queries. When IKEA noticed that people wanted good furnishings at substantially
lower prices, it created knockdown furniture. These two firms demonstrated marketing savvy and turned a
private or social need into a profitable business opportunity.
The 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. Coping with these
exchange processes calls for a considerable amount of work and skill.
Marketing management takes place when at least one party to a potential exchange thinks about the
means of achieving desired responses from other parties. Thus, we see marketing management as the
art and science of choosing target markets and getting, keeping, and growing customers through
creating, delivering, and communicating superior customer value.
Philip Kotler defines marketing as ―a social process by which individuals and groups obtain what
they need and want through creating, offering and freely exchanging products and services of
value with others.
The Chartered Institute of Marketing says Marketing is “the management process responsible for
identifying, anticipating and satisfying customer requirements profitably.”
As defined by Evans & Berman ―Marketing is the anticipation, management and satisfaction of
demand through the exchange process.
We can distinguish between a social and a managerial definition of marketing. A social definition shows
the role marketing plays in society; for example, one marketer has said that marketing’s role is to
“deliver a higher standard of living.”
Here is a social definition that serves our purpose: Marketing is a societal process by which
individuals and groups obtain what they need and want through creating, offering, and freely
exchanging products and services of value with others. Co-creation of value among consumers and
with businesses and the importance of value creation and sharing have become important themes in the
development of modern marketing thought.
Managers sometimes think of marketing as “the art of selling products,” but many people are surprised
when they hear that selling is not the most important part of marketing! Selling is only the tip of the
marketing iceberg. Peter Drucker, famed management theorist, put it this way: There will always, one can
assume, be need for some selling. But the aim of marketing is to make selling superfluous. The aim of
marketing is to know and understand the customer so well that the product or service fits him and
sells itself. Ideally, marketing should result in a customer who is ready to buy. All that should be needed
then is to make the product or service available.
Marketing involves more than just activities performed by a group of people in a defined area or department.
In the often quoted words of David Packard, cofounder of Hewlett-Packard, “Marketing is too important to
be left only to the marketing department.” Marketing entails processes that focus on delivering value and
benefits to customers, not just selling goods, services, and/or ideas. It uses communication, distribution,
and pricing strategies to provide customers and other stakeholders with the goods, services, ideas, values,
and benefits they desire when and where they want them. It involves building long-term, mutually
rewarding relationships when these benefit all parties concerned. Marketing also entails an understanding
that organizations have many connected stakeholder “partners,” including employees, suppliers,
stockholders, distributors, and society at large.
The Value of Marketing
Finance, operations, accounting, and other business functions won’t really matter without sufficient demand
for products and services so the firm can make a profit. Thus, financial success often depends on marketing
ability. Marketing’s value extends to society as a whole. It has helped introduce new or enhanced products
that ease or enrich people’s lives. Successful marketing builds demand for products and services, which, in
turn, creates jobs. By contributing to the bottom line, successful marketing also allows firms to more fully
engage in socially responsible activities. Few of the benefits of marketing are given as under:
1. Increased employment opportunities
As a business grows, thanks to acquiring customers based on professional services satisfying their
needs, they will need to hire more employees to accommodate expanding operations.
2. Awareness and acknowledge of consumer and social well-being
When consumers are doing well then that leads to society as a whole doing well. A business can make
sure that this is happening by prioritizing needs outside of what services it can offer to its consumers
by improving production and operations.
3. Focus on the scientific frame of thought
In order for a business to strategically find a way to be beneficial to society as a whole, it must be based,
not only on market research but on scientific research as well.
4. Increased quality of production
Knowing what the consumer needs can allow for a business to mould their products in the production
process to meet expectations, thus increasing the quality of what they have to offer.
5. The reason for business operations
What is the point of running a business and offering products and services, if said business does not
even know what people want or need?
6. Creates an environment for healthy competition
Different people want/need different things. This allows for multiple businesses (no matter the size) to
thrive in the same marketing by catering to those various needs
7. Increasing consumer status
The more a consumer is happy with a business’ products/services, the more they will buy. New
consumers become and the more they buy, they eventually become a business’ targeted and loyal
demographic.
8. Streamlining business and societal goals
The collaborative effort in a business attempting to align their goals with societal wants leads to more
satisfaction across the board.
9. Effective consumer engagement: Businesses must engage customers, and herein, marketing proves to
be an effective tool. Customers can be engaged by telling them what they do not know and creating
good content around your products and services.
10. Building and maintaining reputation: The reputation of your business depends on how it grows and
what its lifespan is. This is where marketing comes across as a way to build the brand equity of
businesses. And this happens when the expectations of the customers are met.
11. Building relationships between customers and business: For any business to grow, it must build a
long-lasting relationship with its customers. Marketing is based on demographics, psychographics, and
consumer behavior and therefore, gives an understanding of what customers want.
12. Boosting sales: Since marketing utilizes different ways to promote products or services, it helps in
increasing the likelihood of better sales. Happy customers translate into a company’s brand
ambassadors automatically.
13. Staying relevant: Marketing helps a business to remain relevant to the customers and in its domain. It
helps in maintaining good relationships.
14. Making informed decisions: The basic questions that every business has are around the how’s and
why’s of producing products or delivering services. This underscores the importance of marketing for
businesses and the fact that it links a business and society.
