There is no standard definition because marketing is always changing. In short, marketing is the process of communicating the value of a product or service to customers, for selling. Although Marketing isn’t only about selling and advertising, these are just the part of the marketing but the most interesting for the wallets, of course.
From an expanded point of view, marketing serves the selling, promoting, and knowledge of any ideas or people. Thus the marketing extends to non-profit areas such as education, culture, religion, or politics.
Marketing is a combination of social sciences because it covers some areas of economics, psychology, sociology, anthropology, management sciences, and applied mathematics.
From a subjective, societal point of view, marketing is the link between a society’s material requirements and its economic patterns of response. Marketing satisfies these needs and wants through exchange processes and building long-term relationships. Marketing can be looked at as an organizational function and a set of processes for creating, delivering, and communicating value to customers, and managing customer relationships in ways that also benefit the organization and its shareholders. Marketing is the science of choosing target markets through market analysis and market segmentation, as well as understanding consumer buying behavior and providing superior customer value.
There are five competing concepts under which organizations can choose to operate their business:
- Production concept
A firm focusing on a production orientation specializes in producing as much as possible of a given product or service. Thus, this signifies a firm exploiting economies of scale until the minimum efficient scale is reached. - Product concept
A firm employing a product orientation is chiefly concerned with the quality of its product. A firm would also assume that as long as its product was of a high standard, people would buy and consume the product. - Selling concept
A firm using a sales orientation focuses primarily on the selling/promotion of a particular product, and not determining new consumer desires as such. Consequently, this entails simply selling an already existing product, and using promotion techniques to attain the highest sales possible.
Such an orientation may suit scenarios in which a firm holds dead stock, or otherwise sells a product that is in high demand, with little likelihood of changes in consumer tastes that would diminish demand. - Marketing concept
The ‘marketing orientation’ is perhaps the most common orientation used in contemporary marketing. It involves a firm essentially basing its marketing plans around the marketing concept, and thus supplying products to suit new consumer tastes. - Holistic marketing concept
The holistic marketing concept looks at marketing as a complex activity and acknowledges that everything matters in marketing – and that a broad and integrated perspective is necessary for developing, designing, and implementing marketing programs and activities.
The four components that characterize holistic marketing:
- Relationship marketing, Relationship management
Emphasis is placed on the whole relationship between suppliers and customers. The aim is to provide the best possible customer service and build customer loyalty. - Business marketing or Industrial marketing
In this context, marketing takes place between businesses or organizations. The product focus lies on industrial goods or capital goods rather than consumer products or end products. Different forms of marketing activities, such as promotion, advertising and communication to the customer are used. - Societal marketing
Similar characteristics to marketing orientation but with the added proviso that there will be a curtailment of any harmful activities to society, in either product, production, or selling methods. - Branding
In this context, “branding” refers to the main company philosophy and marketing is considered to be an instrument of branding philosophy.
Marketing mix
The marketing mix is a business tool used in marketing and by marketing professionals. The marketing mix is often crucial when determining a product or brand’s offer, and is often associated with the four Ps: price, product, promotion, and place. In service marketing, however, the four Ps are expanded to the seven Ps or eight Ps to address the different nature of services.
In the 1990’s, the concept of four Cs was introduced as a more customer-driven replacement of four Ps. There are two theories based on four Cs: Lauterborn’s four Cs (consumer, cost, communication, convenience), and Shimizu’s four Cs (commodity, cost, communication, channel).
In 2012, a new four P’s theory was proposed with people, processes, programs, and performance.
McCarthy’s four Ps
The marketer E. Jerome McCarthy proposed a four Ps classification in 1960, which has since been used by marketers throughout the world.
- Product
A product is seen as an item that satisfies what a consumer demands. It is a tangible good or an intangible service. Tangible products are those that have an independent physical existence.
Every product is subject to a life cycle including a growth phase followed by a maturity phase and finally an eventual period of decline as sales fall. Marketers must do careful research on how long the life cycle of the product they are marketing is likely to be and focus their attention on different challenges that arise as the product moves. - Price
The amount a customer pays for the product. The price is very important as it determines the company’s profit and hence, survival. Adjusting the price has a profound impact on the marketing strategy, and depending on the price elasticity of the product, often it will affect the demand and sales as well. The marketer should set a price that complements the other elements of the marketing mix.
When setting a price, the marketer must be aware of the customer’s perceived value for the product. Three basic pricing strategies are market skimming pricing, market penetration pricing, and neutral pricing. - Promotion
All of the methods of communication that a marketer may use to provide information to different parties about the product. Promotion comprises elements such as advertising, public relations, sales organization, and sales promotion.
Advertising covers any communication that is paid for, from cinema commercials to radio and Internet advertisements through print media and billboards. Public relations is where the communication is not directly paid for and includes press releases, sponsorship deals, exhibitions, conferences, seminars, or trade fairs and events. Word-of-mouth is an informal communication about the product by ordinary individuals, satisfied customers or people specifically engaged to create word-of-mouth momentum. Sales staff often plays an important role in word of mouth and public relations. - Place (Distribution)
Refers to providing the product at a place that is convenient for consumers to access. Various strategies such as intensive distribution, selective distribution, exclusive distribution, and franchising can be used by the marketer to complement the other aspects of the marketing mix.
Seven Ps
The “seven Ps” is a marketing model that adds to the aforementioned four Ps, including “physical evidence”, “people”, and “process”: It is used when the relevant product is a service, not merely a physical good.
- Physical evidence
The evidence which shows that a service was performed, such as the delivery packaging for the item delivered by a delivery service, or a scar left by a surgeon. This reminds or reassures the consumer that the service took place, positively or negatively. - People
The employees that execute the service, chiefly concerning the manner and skill in which they do so. - Process
The processes and systems within the organization that affect the execution of its service, such as job queuing or query handling.
Lauterborn’s four Cs
Robert F. Lauterborn proposed a four Cs classification in 1990 which is a more consumer-oriented version of the four Ps that attempts to better fit the movement from mass marketing to niche marketing.
- Product ? Consumer
A company will only sell what the consumer specifically wants to buy. So, marketers should study consumer wants and needs to attract them one by one with something he/she wants to purchase. - Price ? Cost
Price is only a part of the total cost to satisfy a want or a need. The total cost will consider for example the cost of time in acquiring a good or a service, the cost of conscience by consuming that, or even the cost of guilt “for not treating the kids”. It reflects the total cost of ownership. Many factors affect cost, including but not limited to the customer’s cost to change or implement the new product or service and the customer’s cost for not selecting a competitor’s product or service. - Promotion ? Communication
While promotion is “manipulative” by the seller, communication is “cooperative” from the buyer to create a dialogue with the potential customers based on their needs and lifestyles. It represents a broader focus. Communications can include advertising, public relations, personal selling, viral advertising, and any form of communication between the organization and the consumer - Place ? Convenience
In the era of the Internet, catalogs, credit cards, and phones people neither need to go anyplace to satisfy a want or a need nor are limited to a few places to satisfy them. Marketers should know how the target market prefers to buy, and how to be there and be ubiquitous, to guarantee convenience to buy. With the rise of the Internet and hybrid models of purchasing, Place is becoming less relevant. Convenience takes into account the ease of buying the product, finding the product, finding information about the product, and several other factors
Four Cs: in the 7Cs Compass Model
After Koichi Shimizu proposed a four Cs classification in 1973, this was expanded to the 7Cs Compass Model to provide a more complete picture of the nature of marketing in 1981. It attempts to explain the success or failure of a firm within a market and is somewhat analogous to Michael Porter’s diamond model, which tries to explain the success and failure of different countries economically.
A formal approach to this customer-focused marketing mix is known as the “Four Cs” (commodity, cost, communication, channel) in the Seven Cs Compass Model. The four Cs model provides a demand/customer-centric version alternative to the well-known four Ps supply side model (product, price, promotion, place) of marketing management.
- Corporation
The core of the four Cs is a corporation (company and nonprofit organization). C-O-S (organization, competitor, stakeholder) within the corporation. The company has to think of compliance and accountability as important. The competition in the areas in which the company competes with other firms in its industry. - Product ? Commodity
Co-creation. It is not “product out”. The goods and services for the consumers or citizens. Steve Jobs has been making the goods with which people are pleased. It will not become commoditization if a commodity is built starting. - Price ? Cost
There are not only production and selling costs but also purchasing and social costs. - Promotion ? Communication
Marketing communication: Not only promotion but communication is important. Communications can include advertising, sales promotion, public relations, publicity, personal selling, corporate identity, internal communication, SNS, and MIS. - Place ? Channel
Marketing channels. The flow of goods. - Consumer
(Needle of compass to consumer) The factors related to consumers can be explained by the first character of the four directions marked on the compass model. These can be remembered by the cardinal directions, hence the name compass model: N = Needs; W = Wants; S = Security; E = Education: (consumer education) - Circumstances
(Needle of compass to circumstances ) In addition to the consumer, there are various uncontrollable external environmental factors encircling the companies. Here it can also be explained by the first character of the four directions marked on the compass model: N = National and International (Political, legal, and ethical) environment; W = Weather; S = Social and cultural; E = Economic
These can also be remembered by the cardinal directions marked on a compass. The 7Cs Compass Model is a framework in co-marketing (symbiotic marketing). It has been criticized for being little more than the four Ps with different points of emphasis. In particular, the seven Cs inclusion of consumers in the marketing mix is criticized, since they are a target of marketing, while the other elements of the marketing mix are tactics. The seven Cs also include numerous strategies for product development, distribution, and pricing, while assuming that consumers want two-way communications with companies.
This article uses material from Wikipedia article “Marketing” and “Marketing mix”, which are released under the Creative Commons Attribution-Share-Alike License 3.0.