What Is Marketing?

By this time, many of you have already had a marketing course and feel quite comfortable about providing a good definition of marketing. However, there is no harm with a little redundancy and to refresh our memories.

Earlier definitions of marketing usually focused on the “exchange” between buyers and sellers. More recently, we have started using a definition more reflective of the current marketing thought process. Accordingly, marketing may be defined as the activities that are designed to accomplish an organization’s goals by understanding customer needs, creating value to satisfy those needs, and building long-term relationships with customers. You'll notice that this definition focuses more on delivering value to customers and sustaining relationships with them.

So, what is value?  It is related to the customer’s perception of the difference between the benefits of a product and the costs of having the product.

Graphic created in Microsoft Office (© 2012)

Figure 1.1. Value Equation

Therefore, we have to look from the customer’s point of view in defining the value. Products can deliver a variety of benefits (functional, experiential, and psychological) to the customers. Therefore, to increase the value of a product in consumer’s mind, marketers need to convince customers about those benefits and reduce the costs of acquiring them.