Marketing
Marketing is the act of acquiring, satisfying and retaining customers. It is one of the primary components of business management and commerce.
Marketing is usually conducted by the seller, typically a retailer or manufacturer. Products can be marketed to other businesses or directly to consumers. Sometimes tasks are contracted to dedicated marketing firms, like a media, market research, or advertising agency. Sometimes, a trade association or government agency advertises on behalf of an entire industry or locality, often a specific type of food, food from a specific area, or a city or region as a tourism destination.
Market orientations are philosophies concerning the factors that should go into market planning. The marketing mix, which outlines the specifics of the product and how it will be sold, including the channels that will be used to advertise the product, is affected by the environment surrounding the product, the results of marketing research and market research, and the characteristics of the product's target market. Once these factors are determined, marketers must then decide what methods of promoting the product, including use of coupons and other price inducements.
Definition
Marketing is currently defined by the American Marketing Association as "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". However, the definition of marketing has evolved over the years. The AMA reviews this definition and its definition for "marketing research" every three years. The interests of "society at large" were added into the definition in 2008. The development of the definition may be seen by comparing the 2008 definition with the AMA's 1935 version: "Marketing is the performance of business activities that direct the flow of goods, and services from producers to consumers". The newer definition highlights the increased prominence of other stakeholders in the new conception of marketing.File:Portrait of Josiah Wedgwood gupjg13 4 ics8nad.tiff|thumb|right|The 18th century retail entrepreneur Josiah Wedgwood, who devised a number of sales methods for his tableware, is "credited with inventing modern marketing" according to the Adam Smith Institute.
Recent definitions of marketing place more emphasis on the consumer relationship, as opposed to a pure exchange process. For instance, prolific marketing author and educator, Philip Kotler has evolved his definition of marketing. In 1980, he defined marketing as "satisfying needs and wants through an exchange process", and in 2018 defined it as "the process by which companies engage customers, build strong customer relationships, and create customer value in order to capture value from customers in return". A related definition, from the sales process engineering perspective, defines marketing as "a set of processes that are interconnected and interdependent with other functions of a business aimed at achieving customer interest and satisfaction".
Some definitions of marketing highlight marketing's ability to produce value to shareholders of the firm as well. In this context, marketing can be defined as "the management process that seeks to maximise returns to shareholders by developing relationships with valued customers and creating a competitive advantage". For instance, the Chartered Institute of Marketing defines marketing from a customer-centric perspective, focusing on "the management process responsible for identifying, anticipating and satisfying customer requirements profitably".
In the past, marketing practice tended to be seen as a creative industry, which included advertising, distribution and selling, and even today many parts of the marketing process involve the use of the creative arts. However, because marketing makes extensive use of social sciences, psychology, sociology, mathematics, economics, anthropology and neuroscience, the profession is now widely recognized as a science. Marketing science has developed a concrete process that can be followed to create a marketing plan.
Concept
The "marketing concept" proposes that to complete its organizational objectives, an organization should anticipate the needs and wants of potential consumers and satisfy them more effectively than its competitors. This concept originated from Adam Smith's book The Wealth of Nations but would not become widely used until nearly 200 years later. Marketing and Marketing Concepts are directly related.Given the centrality of customer needs, and wants in marketing, a rich understanding of these concepts is essential:
Marketing research, conducted for the purpose of new product development or product improvement, is often concerned with identifying the consumer's unmet needs. Customer needs are central to market segmentation which is concerned with dividing markets into distinct groups of buyers on the basis of "distinct needs, characteristics, or behaviors who might require separate products or marketing mixes." Needs-based segmentation "places the customers' desires at the forefront of how a company designs and markets products or services." Although needs-based segmentation is difficult to do in practice, it has been proved to be one of the most effective ways to segment a market. In addition, a great deal of advertising and promotion is designed to show how a given product's benefits meet the customer's needs, wants or expectations in a unique way.
B2B and B2C marketing
The two major segments of marketing are business-to-business marketing and business-to-consumer marketing.B2B marketing
B2B marketing refers to any marketing strategy or content that is geared towards a business or organization. Any company that sells products or services to other businesses or organizations typically uses B2B marketing strategies. The 7 P's of B2B marketing are: product, price, place, promotion, people, process, and physical evidence. Some of the trends in B2B marketing include content such as podcasts, videos, and social media marketing campaigns.Examples of products sold through B2B marketing include:
- Major equipment
- Accessory equipment
- Raw materials
- Component parts
- Processed materials
- Supplies
- Venues
- Business services
- Producers - use products sold by B2B marketing to make their own goods
- Resellers - buy B2B products to sell through retail or wholesale establishments
- Governments - buy B2B products for use in government projects
- Institutions - use B2B products to continue operation
B2C marketing
Traditionally, this could refer to individuals shopping for personal products in a broad sense. More recently the term B2C refers to the online selling of consumer products.
C2B marketing
Consumer-to-business marketing or C2B marketing is a business model where the end consumers create products and services which are consumed by businesses and organizations. It is diametrically opposed to the popular concept of B2C or business-to-consumer where the companies make goods and services available to the end consumers. In this type of business model, businesses profit from consumers' willingness to name their own price or contribute data or marketing to the company, while consumers benefit from flexibility, direct payment, or free or reduced-price products and services. One of the major benefit of this type of business model is that it offers a company a competitive advantage in the market.C2C marketing
marketing or C2C marketing represents a market environment where one customer purchases goods from another customer using a third-party business or platform to facilitate the transaction. C2C companies are a new type of model that has emerged with e-commerce technology and the sharing economy.Differences in B2B and B2C marketing
The different goals of B2B and B2C marketing lead to differences in the B2B and B2C markets. The main differences in these markets are demand, purchasing volume, number of customers, customer concentration, distribution, buying nature, buying influences, negotiations, reciprocity, leasing and promotional methods.- Demand: B2B demand is derived because businesses buy products based on how much demand there is for the final consumer product. Businesses buy products based on customer's wants and needs. B2C demand is primarily because customers buy products based on their own wants and needs.
- Purchasing volume: Businesses buy products in large volumes to distribute to consumers. Consumers buy products in smaller volumes suitable for personal use.
- Number of customers: There are relatively fewer businesses to market to than direct consumers.
- Customer concentration: Businesses that specialize in a particular market tend to be geographically concentrated while customers that buy products from these businesses are not concentrated.
- Distribution: B2B products pass directly from the producer of the product to the business while B2C products may additionally go through a wholesaler or retailer.
- Buying nature: B2B purchasing is a formal process done by professional buyers and sellers, while B2C purchasing is informal.
- Buying influences: B2B purchasing is influenced by multiple people in various departments such as quality control, accounting, and logistics while B2C marketing is only influenced by the person making the purchase and possibly a few others.
- Negotiations: In B2B marketing, negotiating for lower prices or added benefits is commonly accepted while in B2C marketing prices are fixed.
- Reciprocity: Businesses tend to buy from businesses they sell to. For example, a business that sells printer ink is more likely to buy office chairs from a supplier that buys the business's printer ink. In B2C marketing, this does not occur because consumers are not also selling products.
- Leasing: Businesses tend to lease expensive items while consumers tend to save up to buy expensive items.
- Promotional methods: In B2B marketing, the most common promotional method is personal selling. B2C marketing mostly uses sales promotion, public relations, advertising, and social media.