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.
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".
Besides, customers 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 (e.g. product design, art director, brand management, advertising, inbound marketing, copywriting etc.) 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. 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:
Needs: Something necessary for people to live a healthy, stable and safe life. When needs remain unfulfilled, there is a clear adverse outcome: a dysfunction or death. Needs can be objective and physical, such as the need for food, water, and shelter; or subjective and psychological, such as the need to belong to a family or social group and the need for self-esteem.
Wants: Something that is desired, wished for or aspired to. Wants are not essential for basic survival and are often shaped by culture or peer-groups.
Demands: When needs and wants are backed by the ability to pay, they have the potential to become economic demands.
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 (also known as benefit 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.
The two major segments of marketing are business-to-business (B2B) marketing and business-to-consumer (B2C) marketing.B2B marketing
B2B (business-to-business) 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 (vs. consumers) typically uses B2B marketing strategies.
Examples of products sold through B2B marketing include:
Major equipment
Accessory equipment
Raw materials
Component parts
Processed materials
Supplies
Business services
The four major categories of B2B product purchasers are:
Producers- use products sold by B2B marketing to make their own goods (e.g.: Mattel buying plastics to make toys)
Resellers- buy B2B products to sell through retail or wholesale establishments (e.g.: Walmart buying vacuums to sell in stores)
Governments- buy B2B products for use in government projects (e.g.: purchasing contractor services to repair infrastructure)
Institutions- use B2B products to continue operation (e.g.: schools buying printers for office use)B2C marketing
Business-to-consumer marketing, or B2C marketing, refers to the tactics and strategies in which a company promotes its products and services to individual people.
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.
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.
C2C marketing
Customer to customer 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 must 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 (particularly in Western cultures) 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.
Content Source: https://en.wikipedia.org/wiki/Digital_marketing
Image: Pexels
Affiliate marketing is a type of performance-based marketing in which a business rewards one or more affiliates for each visitor or customer brought by the affiliate's own marketing efforts.