1.3 Marketing

What Is Marketing?

Do a Google search on the topic, “What is marketing?” and you will find dozens of sites defining marketing in a variety of different ways. The American Marketing Association states that 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.”1 No matter what the definition, some basic concepts that most marketers agree on include selecting a specific group of target consumers, setting the marketing objectives, and creating and maintaining the marketing mix: product, price, place and promotion).2

The Marketing Mix

Introduced by E. Jerome McCarthy in 1964, the marketing mix was created as a means of translating marketing planning into long-term or short-term practices.3 Just as a contractor can adjust and assemble the materials he needs depending on the type and style of house he wants to build, so can elements of the marketing mix be changed depending on the product or the desired results.

• Product: The product is the tangible, physical items (e.g., cars, furniture, computers, or sports equipment) or an intangible service (e.g., pest control, house painting, piano lessons, or auto repair) that is being sold or purchased.

• Price: The price is the amount a consumer pays for the product or service. Price is extremely important for the marketer because it determines the company’s profits. The marketer must set the price of the product high enough for the company to make a profit, yet low enough so the consumer will make the purchase. The marketer must know and understand the consumer’s perceived value of a product in order to set the price. Higher prices are typically associated with higher quality products and lower prices are associated with lower quality products.

• Place: Often referred to as the distribution of the product, place is concerned with getting the product from the manufacturer into the hands of the consumers. The distribution includes storing and transporting the products to the stores so consumer purchases can be made.

• Promotion: Promotion is the communication segment of the marketing mix consisting of advertising, public relations, and promotions. This is also known as the promotional mix. The role of promotions is “to help bring about mutually satisfying exchanges with target markets by informing, educating, persuading, and reminding them about the benefits of an organization or product.”4

The Promotional Mix

The part of the marketing mix that is the most important to advertisers is promotion. Promotion includes all of the promotional variables available to a marketer to promote the product. These communication variables include but are not limited to the following:

• Advertising: Advertising was defined earlier in the chapter as paid, nonpersonal communication from an identified sponsor using mass media to persuade or influence an audience.5

• Public Relations: The Public Relations Society of America (PRSA) defines public relations as “a strategic communication process that builds mutually beneficial relationships between organizations and their publics.”6

  Picture by Michal Chmurski via Shutterstock.

• Sales Promotions: A sales promotion is a “marketing activity that adds to the basic value of the product or service for a limited period of time and directly stimulates purchasing by the target audience.”7

• Direct Marketing: The Direct Marketing Association of America states that “direct marketing is a channel-agnostic form of advertising that allows businesses and nonprofits organizations to communicate straight to the customer, with advertising techniques that can include mobile, text messaging, email, interactive consumer websites, online display ads, fliers, catalog distribution, promotional letters, and outdoor advertising.”8