Marketing - Definition, Importance, Components & Example
What is Marketing?
Marketing is a process in business which helps to generate, communicate and transfer value about a product or service to customers, partners and the potential market. Marketing involves processes like market research, advertising, marketing communication, branding etc which showcases the customers the value proposition offered by companies. Marketing helps create brand awareness among the potential market and drives the business.
It also focuses on customer service, PR activities and other means which help a business grow. Marketing along with finance, human resources and operations forms the backbone for any business to increase sales revenue. All the activities managed within an organization fall under marketing management.
Importance of Marketing
Every company is busy making a product or service which is useful in fulfilling a need or requirement of a person which is the basis of marketing concept. However, with many companies involved in giving similar products or services, people are unaware of all the options available to them. This is where promotion plays an important role in business and helps improve the market share for a company. It helps businesses reach out to new customers, understand their needs better and advertise products for the customers to buy by advertising.
It helps in creating brand awareness of any business which has some value to offer to its customers. It has become an extremely specialized profile in businesses as well as it requires a lot of skill, experience and knowledge to understand the customer and deliver the correct message to them. Sometimes, social marketing is also done to bring about an effective change in the society. These days companies invest a lot in marketing information system (MIS) tools to gather relevant data of customers.
Components of Marketing
Marketing is a big domain in business covering important aspects of a business related to the product, service, customer, recognition, brand awareness etc. Some of the most important components are:
1. Marketing research- Understanding the business and customers by studying the market, industry, demographics etc which is a part of research.
2. Advertising- Using mediums of communication like TV, print, online, OOH etc by promoting brand through advertisements and sponsorships are essential components
3. Pricing- It helps to understand the optimum price of a product which a company should keep for maximum sales and high margins
4. Customer support- Providing service to customers in terms of after sales service, customer relationship management etc all come under customer support
5. Media Planning- Utilizing the correct channel for brand promotion is studied by understanding different types, costs and effectiveness of media
6. Public Relations- It helps companies spread a positive word about the products and services through news channels, newspapers, magazines etc and help build strong PR relations.
7. Sales- Marketing and sales go hand in hand in ensuring that a company’s business is prosperous as both are interdependent.
8. Brand promotion- Brand building exercises are done by effective strategies which help to build a loyal customer base for a business.
The above image shows the various components in marketing
Advantages of Marketing
There are several advantages of marketing for a business. Some of the benefits are:
1. It helps a business reach out to many customers across geographies by advertising
2. It helps understand the customer needs and requirements in a more systematic way.
3. The price of products which can give maximum profit to a business can be understood by marketing.
4. A good market research can help develop new products, improve existing products and capture a bigger market.
5. It helps companies have a loyal customer base as they provide a good after sales service, customer support etc
6. Brand awareness is spread by promotion as most of the people are unaware about the products or services available worldwide
Disadvantages of Marketing
Even though marketing is pivotal for every business, there are certain drawbacks. Some of them are:
1. It becomes extremely costly for a company which is involved in promoting its products by extensive promotion
2. A lot of time is invested into ensuring that the right kind of communication is given
3. Despite all investments, communication and business strategies, customers do not buy the product or service, which can lead to severe losses to a company.
Examples of Marketing
There can be thousands of examples of marketing. A few selected examples are:
1. Vodafone through its TV commercials, online ads and print ads created a buzz in the market with its ZooZoo campaign, which helped the business become a top of the mind brand
2. Nike is one of the leading companies in the world which focuses on promotions through advertising by having sports celebrities as brand ambassadors
3. Beverage giants Coca Cola and Pepsi come up with new campaigns every season and try to build a strong connect with their customers
Hence, this concludes the definition of Marketing along with its overview.
This article has been researched & authored by the Business Concepts Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.
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