Why Marketing is Important in Businesses?

Marketing is defined as the collection of activities undertaken by a firm to relate profitability to its market. Marketing in the modem context goes beyond its immediate role as a process through which exchange of goods and services takes place and is viewed as an integral part of the total socio economic system which provides the framework within which activities take place. Marketing involves the performance of operation in a business system It is concerned with all activities that are concerned with the physical distribution of goods and their exchange in the market place, including channel of selection, transportation, shipping, warehousing, storage, inventory control and so on and so forth.

In marketing, there are four basic kinds of utility – form, time, place and ownership utility. Form utility is created when the firm converts raw materials and component inputs into finished goods and services. Although marketing provides important inputs that specify consumer preference, the organization’s production function is responsible for the actual creation of form utility. Marketing function creates time, place and ownership utilities. Time and place utility occur when consumers find goods and services available when and where they want to purchase them. Vending machines focus on providing place utility for people buying snacks and soft drinks. The transfer of title to goods or services at the time of purchase creates ownership utility.

Peter F.Drucker emphasized the importance of marketing in his classic book, The Practice of Management as: ‘If we want to know what a business is, we have start with its purpose. And its purpose must lie outside the business itself. In fact, it must lie in society since a business enterprise is an organ of society. There is one valid definition of business purpose: to create a customer’. 

How does an organization create a customer?

Guiltinan and Paul explained it this way:

Essentially, ‘creating’ a customer means identifying needs in the marketplace, finding out which needs the organization can profitably serve and developing an offering to convert potential buyers into customers.

Marketing managers are responsible for most of the activities which are necessary to create the customers as well as to retain the customers. The primary activities of marketing managers are :

  1. Identifying customer needs
  2. Designing goods and services that meet those needs
  3. Communication information about those goods and services to prospective buyers
  4. Making the goods and services available at times and places that meet customers’ needs
  5. Pricing goods and services to reflect costs, competition and customers’ ability to buy
  6. Providing for the necessary service and follow-up to ensure customer satisfaction after the purchase

What is Marketing?

The following table summarizes the key differences between marketing and selling concepts.

The difference between selling and marketing can be best illustrated by this popular customer quote: ‘Don’t tell me how good your product is, but tell me how good it will make me’. The American Marketing Association, the official organization for academic and professional marketers, defines marketing as: Marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational objectives.

Another definition goes as ‘… process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others’. Simply put: Marketing is the delivery of customer satisfaction at a profit.”

The expanded concept of marketing activities permeates all organizational functions. It assumes that the marketing effort will follow the overall corporate strategy and will proceed in accordance with ethical practices and that it will effectively serve the interests of both society and organization. The concept also identifies the marketing variables – product, price, promotion and place – that combine to provide customer satisfaction. In addition, it assumes that the organization begins by identifying and analyzing the consumer segments that it will later satisfy through its production and marketing activities. The concept’s emphasis on creating and maintaining relationships is consistent with the focus in business on long-term, mutually satisfying sales, purchases and other interactions with customers and suppliers. Finally it recognizes that marketing concepts and techniques apply to non-profit organizations as well as to profit-oriented businesses, to product organization and to service organizations, to domestic and global organizations, as well as to organizations targeting consumers and other businesses. 

Marketing is a tool used to create and maintain demand, relevance, reputation, competition and more. Without it, the question of business existence will come. .

Why Marketing is important in businesses?

The following points are listed below:

  1. Marketing Is an Effective Way of Engaging Customers: Engaging customers is different from pushing your offers. Engaging involves providing relevant information about products. It’s all about creating fresh content.
  1. Marketing Helps to Build and Maintain the Company’s Reputation: Marketers use effective communication, branding, PR and CSR strategies to ensure that a business’s reputation is maintained. The reputation of business determines brand equity.
  1. Marketing Helps to Build a Relationship between a Business and Its Customers: Businesses need to build a relationship of trust and understanding with their customers. The trust and understanding between the business and its customers make your commercial activities more fruitful.
  1. Marketing is a Communication Channel Used to Inform Customers: Through marketing, the customers get to know about the value of the products, their usage and additional info that might be helpful to the customers. It creates brand awareness and makes the business stand out.
  1. Marketing helps to boosts Sales: Marketing utilizes different ways to promote products or services. Customers may want to try their desired products or services and this will trigger a purchase decision.
  1. Marketing Aids in Providing Insights about Business: Every marketer understands the need for targeting the right audience. However, the marketer must develop right marketing strategies that can help them to establish what business messaging will convince the target audience.
  1. Marketing Helps Businesses to Maintain Relevance: Every relationship needs to be maintained. Marketing helps the marketers to maintain a good and cordial relationship with customers by delivering right types of product at right price and right place.
  2. Marketing Creates Revenue Options: It is the marketing function who is responsible for revenue generation.
  3. Marketing Helps the Management Team to Make Informed Decisions: Every business is confronted with problems such as to what, when, for whom and how much to produce. Through marketing and from the market place the marketers can identify the deficiencies and after that they can take up the right type of decisions.

Dr Suman Kumar Dawn

Principal ( Acting)