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The Scope ofMarketing

PART1

■ What are your favourites?It may seem very strange to start the first chapter of a textbook with a question.However, it is a highly pertinent one. Before reading the Introduction take a fewminutes to answer the following brief questions:

� What are your three favourite movies? Why are they your favouritemovies? What influenced you to go to see them?

� What are your three favourite CDs? Why are they your favourite CDs?What influenced you to go to buy them? If you did not buy them, were theya gift to you?

� What is your favourite food? Why is it your favourite food? Did anyone oranything influence you to try this food for the first time?

Encapsulated within those brief questions are the basics of marketing. By thetime you reach the end of this textbook you will know exactly how pertinentthese questions are to you and your understanding of marketing.

IntroductionThe aim of this chapter is to ‘set the scene’, to consider what marketing reallyis to you and me. It discusses what marketing comprises, its development andhow it affects our daily lives. Marketing, as we shall see throughout this text, iscomposed of many elements from numerous subject areas and disciplines. Forinstance, economics, sociology, psychology, statistics and mathematics, as wellas politics and the law, have all influenced marketing in one form or another.

CH

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1A Brief Introduction toMarketing

Learning outcomes 3What are your

favourites? 3Introduction 3The origin of

marketing 4An economics approach 5A consumer’s (or

buyer’s) approach 6The societal approach 6The managerial or

systems approach 7A broader approach 7Relationships 9Transactions 9Time 9Dialogue 9The marketer:

alchemist, magician,sorcerer and medicine man 10

Marketing as an organisational function 11

Who is engaged in marketing? 12

Marketing now and tomorrow: current and future trends 12

2004–14? 13Chapter summary 15Questions for review

and reflection 16References 16

ContentsLearning outcomes

After completing this chapter you should be able to:

� outline the origins and the different orientations of marketing

� debate the role of the marketer within a business environment

� evaluate the development of marketing

� consider marketing within the ‘realistic’ real world environment.

The actual term ‘marketing’ may be a creation ofrecent history, often associated with the dawn of the20th century. However the actions of marketingdate back thousands of years. We know from exca-vations of caves that early civilizations used ‘adver-tising’ to inform other members of the communityof events and issues, indeed also to warn them ofperils in the area. Equally customers or consumers,as we know them, are far from being a recentphenomenon. Customers are as old as the firsttransaction between two people.

The social, economic, political and technologicalchanges during the 20th century revolutionised theway we lived and worked. Moreover these ‘revolu-tions’ provided the means or the platform for anequally dramatic change in the marketing of prod-ucts and services linked to dynamic competitiveenvironments. The 21st century obviously remainsan unknown quantity. Already in its early years thiscentury has witnessed tremendous growth incertain business sectors, decline in others, increasedcompetition in both home and internationalmarkets, societal change and geopolitical turmoil.Where the next 20 or so years will lead us isanyone’s guess. However, marketing, in one form

or another, will play an integral role in reacting tochange and even shaping change.

■ The origin of marketingMarketing is something that affects every one ofus every waking moment of our lives – eventhough we may not necessarily be conscious of it.From that very moment we stir out of deep sleep,turn on the radio or television, and walk aroundthe house, we are bombarded by marketing mes-sages. They are not always in the form of adver-tisements beaming from the radio or television.

4 1 • INTRODUCTION TO MARKETING

Figure 1.1

© Jonathan Groucutt

Everywhere we go we are being marketed to in oneform or another. Marketing is with us each second ofour waking lives.This is a Parisian street with marketing images galore.What are the marketingimages where you live?

Figure 1.2


Stunning architecture such as the Eiffel Tower in Parisacts as a branding not only of Paris but of France.Thesame could be said of the Statue of Liberty in NewYork, the Opera House in Sydney and the Houses ofParliament in London.What other national symbols doyou think represent countries? What are the nationalsymbols of your country?

Think of the packaging in your kitchen or bath-room. Even on non-commercial radio and televi-sion stations there are still marketing messages, inthe form of publicity and public relations. Evenbefore we leave the house we have already seen orheard hundreds of marketing messages. Then itjust explodes – newspapers, magazines, billboardsand posters. There are messages everywhere,invading every aspect of our lives.

All this relates to marketing, but how do wedefine marketing? This is not as easy as onemight think. Indeed as Cooke, Rayburn andAbercrombie (1992) suggested, ‘after about 80years of formal marketing education (thought)there is no consensus on the definition ofmarket’. Has this perspective changed? No. It isperhaps a scary thought that a subject that is amajor course at the vast majority of universitieshas no hard and fast definition. However, beingable to debate a definition for marketing allowsus to consider the subject as being flexible anddynamic, just like the world we live in.

In the next section we investigate some of thevarious definitions of marketing, drawing on arange of subject areas. It may well turn out thatthere is no one definition that fits all aspects ofmarketing. As marketers we may have to be flexible in our understanding of the subject, andits relationship with us both as individuals and a

society, especially within a turbulent macro environment.

An economics approachWith an economics approach the emphasis is onproducts (usually referred to as goods) and services,sources of supply, the most commonly used chan-nels of distribution and the functions performedduring the marketing process (Cooke et al. 1992).

Three definitions can be provided on the basis ofthe economics approach:

Marketing is the performance of business activ-ities directed toward, and incident to, the flow ofgoods and services from producer to consumeror user.(American Marketing Association (AMA) 1948)

Marketing embraces all the business activitiesinvolved in getting commodities of all kinds,including services, from the hands of producersand manufacturers into the hands of the finalconsumers. All the business steps through whichgoods progress on their way to final consump-tion is the concern of marketing. This is

THE ORIGIN OF MARKETING 5

Figure 1.3

© Shereen Baig. Reproduced with kind permission.

The Taj Mahal at Agra in the Uttar Pradesh region ofNorthern India.This imposing extravagant white marble mausoleum has become, in essence, the touristsymbol of traditional India.

Figure 1.4


Marketing however is not just about symbols andbrands. It is about how we choose the products andservices we want to buy. In this weekly Italian marketthe shoppers have a wide variety of choice of bothfresh food and goods including clothing, toys and luggage.They will make decisions based on several factors including quality, price and customer service.

especially true of the points in those stages atwhich change of ownership takes place.

(McNair et al. 1975)

Marketing is the performance of business activ-ities that direct the flow of goods and servicesfrom producer to consumer or user.

(AMA 1960)

As Cooke et al. (1992) state, there are several keywords that summarise these definitions:

� goods/services

� transfer of ownership

� storage

� flow of goods/services

� distribution/transport

� functions.

We shall return to these points later.

A consumer’s (or buyer’s) approachThis perspective arises out of consumers’ dissat-isfaction with products, services and the organi-sations that provide them. Linked to this is thesubsequent need for governments to protect indi-vidual consumer rights through legislation. Thedissatisfaction emanated from the followingviews:

� The marketing system was unresponsive toconsumer wants.

� Marketing practitioners were unscrupulous.

� Marketers made claims that were not borne outby the actual performance of the product.

� Consumers sought increased product quality.

� Increasing concern over hazardous and unsafeproducts entering the marketplace, especiallyelectrical goods and children’s toys.

� Concern over misleading advertising, deceptive packaging and labelling.

Three definitions provide an insight into theconsumer perspective:

Marketing consists of four general activities: 1.Identifying and selecting the type of customerthat the business will cultivate, learning hisneeds and desires; 2. Designing products orservices that the firm can sell at a profit inconformity with customers desires; 3. Persuad-ing customers to buy at the firm’s offerings; 4.Storing, moving, and displaying goods afterthey leave the production site.

(Oxenfeldt 1966)

Note the use of the word ‘his’. Perhaps the focusremained male dominated?

That process through which a business enterprise,institution, or organization 1. selects targetcustomers or constituents, 2. assesses the needs orwants of such target customers, and 3. manages itsresources to satisfy those customer needs or wants.

(Star et al. 1977)


� consumer

� meet – fulfil – satisfy

� product (goods and services)

� wants

� determine – assess needs

� needs

� target customers.

We shall return to these points later.

The societal approachThis can be considered as a needs-fulfillingexchange or relationship activity that is present, toa greater or lesser degree, within all cultures. Cookeet al. (1992) suggest that it is the ‘process ofexchange in society and this process must occur insociety so that the consumption of values canoccur’. They continue:

The societal view of marketing as exchange rela-tionships begin with the basic idea that mosthuman behaviour is the planned, purposefulquest and search for want satisfaction. Individu-


als act to satisfy their wants and desires. Goods,services, or ideas are the source of this satisfaction.

Cunningham and Cunningham (1981) suggest that societal marketing performs three essential functions:

1 As an information network – knowing andunderstanding the consumer’s changing needsand wants.

2 Equalising the distribution function – effi-ciently and effectively managing the supplyand demand of products and services.

3 Centralising the exchange function – efficientprovision of distribution and payment processing systems.

Two definitions provide an insight into the societalperspective:

Marketing may be thought of as that phase ofbusiness activities which human activities aresatisfied by the exchange of goods and services,on the one hand, for some valuable consideration– using money or its equivalent – on the other.

(Pyle 1931)

Marketing is the delivery of a standard of livingto society.

(Mazur 1947)


� consumption – relationship

� matching

� society

� exchange

� social process

� standard of living.

Once again, we shall return to these points later.

The managerial or systems approachThis is the approach of management within individual companies or organisations (including

not-for-profit and public sector organisations) tomarketing. The emphasis is on how the individualorganisation processes marketing and develops thestrategic dimensions of marketing activities.Hughes (1978) suggests that marketing managersfocus on market analysis and the selection of targetmarket segments, strategy development and thecreation of a profit plan. Of course, a profit plandoes not exist within a not-for-profit organisation,such as a charity. Nevertheless these organisationsneed to generate revenues to both develop theorganisation and to deliver products/services to itsclients: for example, the distribution of food andmedical supplies in famine-stricken areas.

The managerial approach can be described asfollows:

Marketing is the combination of activitiesdesigned to produce profit through ascertaining,creating, stimulating, and satisfying the needsand/or wants of a selected segment of the market.

(Eldridge 1970)

As Cooke et al. (1992) state, there are several keywords that summarise this approach:

� anticipate (demand)

� business – corporation – organisation

� goods – services

� objectives of organisations

� product development – design

� stimulate (demand)

� assess – determine

� create (demand)

� meet – fulfil

� profit

� strategy

� target (customers).

A broader approachWhile some definitions fit relatively neatly into oneof the four categories above, not all definitions do.Perhaps marketing is not as easy to define as wemight think?

In the early 1990s Kotler defined marketing as:


A social and managerial process by which indi-viduals and groups get what they need andwant through creating and exchanging productsof value with others.

(Kotler 1991)

By 2000 he had slightly modified this to:

A societal process by which individuals andgroups obtain what they need and want throughcreating, offering, and freely exchanging prod-ucts and services of value with others.

(Kotler 2000)

While the differences between the two definitionsmight appear slight, they are significant. Considerthe following:

� The second definition has introduced the term‘societal’ and removed the managerial element.However, it could be debated that marketingneeds management of the process in order forit to be both effective and efficient.

� Also in the second definition the word ‘freely’is introduced. Marketing involves an exchangeof one form or another. This can be anexchange of a product for money. Equally itcould be an exchange of an emotional feeling(for instance, a thank you) for a donation to acharity, or a huge hug when we give a gift to aloved one.

� In the second definition Kotler has also intro-duced the word ‘service’. While an early focuson marketing was driven by ‘products’, the last30 years especially have witnessed a dramaticrise in service-oriented business, coveringeverything from travel companies to super-markets. Thus ‘service’ is a key ingredient inmarketing operations, even within a mainlyproduct-based business. This is an element thatrecurs throughout this text.

Now compare Kotler’s views with those of theAMA. In many ways they are similar, only differingin some of the nomenclature and specifics, such aspricing. However, it could be argued that theAMA’s definition is more financially focused interms of transactions.

In the 1960s the AMA defined marketing as:

The process of planning and executing theconception, pricing, promotion and distribu-tion of ideas, goods and services to create exchanges that satisfy individual andorganisational goals.

(AMA 1960)

As Cooke et al. (1992) state, definitions of market-ing change as a result of environmental changes,or because our knowledge of the subjectimproves, or indeed through a combination ofthese two reasons. Marketing as a subject ordiscipline is therefore evolving. It is important tocomprehend marketing as a dynamic and not astatic subject. As we shall see as we journeythrough this textbook, the elements thatcomprise the marketing discipline are often in astate of flux due to the fluidity of both the microand macro environments. (See Chapter 2.) It ishow the people involved in marketing handlesuch environments and experiences that oftendetermines whether a product or service is viableor not, and over what time frame.

This is made clear by a new definition issued bythe AMA in 2004 (Keefe 2004):

Marketing is an organizational function and setof processes for creating, communicating anddelivering value to customers and for managingcustomer relationships in a way that benefitsboth the organization and the stakeholder.

While there is still an emphasis on process – thatis fundamental to marketing – we now see theuse of the words ‘value’, ‘managing customerrelationships’ and ‘stakeholders’ being broughtto centre stage. These are issues that are reflectedthroughout this text.

Equally, as Mercer (1997) contends:

Marketing is the one (our italics) fundamentalactivity undertaken by all organizations. Formost of them it is also the most importantcontributor to their success or failure.

Mercer (1997) also suggests that marketing is:

Both a relationship with the customer, basedupon a series of transactions which, over time,should result in mutual benefit, and a parallel


dialogue between you and the customer(s),which communicates the information necessaryto define the relationship.

There are several key elements to Mercer’s descrip-tion which define the interaction between customer(buyer) and supplier (seller) as ‘complex’. Thiscomplexity has often been overlooked.

RelationshipsThese must be seen as two-directional, not just purelyseller to buyer, but also buyer to seller. The sellermust understand the needs and wants of the buyerin order to deliver a suitable product and/or service.

TransactionsTraditionally writers have considered transactionspurely in terms of the exchange of money for aproduct. This is a tangible transaction: somethingsolid changes hands. Thus there was a view thatdefinitions containing the word ‘transaction’ werenot applicable to not-for-profit organisations, suchas charities, as the transactions they dealt in wereintangible. However a transaction does not have toinclude money for a physical product or service: itcan equally take place within a charitable environ-ment. For instance, if a person donates 100 euros toa children’s charity, three parties benefit from thatdonation:

� the child who receives the direct benefit of thedonation

� the charity in terms of raising donations and itsprofile

� the individual who donates the 100 euros,whose element of the transaction is the psycho-logical good he or she feels, and the belief thathe or she has contributed to helping to providea child with a better life.

TimeMercer (1997) refers to ‘a series of transactionswhich, over time, should result in mutual benefit’.The time element could be construed in several ways.

Some transactions take place within a very short

time frame. For example, a commuter buying anewspaper from a street corner vendor on his orher way to work is engaged in a quick transaction.Others do not. For example, an individual maywant to purchase a product or donate to a charity.He or she is short of funds and unable to do so rightaway, but intends to do so later, perhaps in a weekor a month. One important issue here is the needfor the organisation to maintain a dialogue with theprospective customer (see below).

Mercer’s statement comes into its own when thebuyer and seller develop a relationship. Continualtransactions – for example, regular visits to a partic-ular restaurant – can deepen the relationshipbetween the staff/owner and the customer. Themutual benefit derived can be a mixture of:

� revenue for the restaurant – not only from thecustomer but also from the customer’s friends(to whom he or she recommends it)

� loyalty from the customer in the form ofcontinuing support

� the food and ambience that the customerenjoys, and his or her personal feeling of‘reward’ for dining at that restaurant.

DialogueThere must be a dialogue between the buyer andthe supplier. This can take two forms.

Supplier to buyer

This is usually in the form of marketing communi-cations such as advertising and public relations.This is where the supplier communicates andpromotes the features and benefits of the product orservice.

Buyer to supplier

This is where buyers either directly or indirectlystate their personal needs and wants. A customermay communicate directly with a companythrough marketing research, where the companyseeks feedback on specific marketing issues. Alter-natively, the customer may have an indirectdialogue with the company by switching brands.This indirect dialogue can be seen as informing thecompany that ‘something is wrong with the


product’. This ‘problem’ could be price, quality,accessibility or a combination of factors.

We have looked at a few definitions of market-ing, but there are significantly more. McDonald(2002), for example, cites some 30 definitions. Virtu-ally everyone who has written on the subject ofmarketing has probably put forward his or her owndefinition in one way or another. So as for manyother disciplines, there is no absolute definition.The definitions given vary to a greater or lesserextent, depending on circumstances, attitudes andthe time at which they were conceived. At the endof this chapter we briefly consider the future of thisdiscipline called ‘marketing’. While it will continueto affect our lives into the distant future, what wecall it and how we define it may be different fromthe terms we use now.

■ The marketer: alchemist,magician, sorcerer andmedicine man1

As we have seen from the brief examples earlier inthis chapter, marketing is universal. However, is it anart or a science? Perhaps marketing is more likesorcery. Think of a sorcerer collecting ingredientsfrom different sources and mixing them into a potion,accompanied with the magical effect of a flash of lightand the illusion to follow. To some extent this fits withCulliton’s vision of a marketer as a ‘mixer of ingredi-ents’ (a view we consider fully in a later chapter). Ofcourse sorcerers are more mythical than real, but if westay with this myth it may help to dispel some of themyths surrounding ‘marketing’.

Though mythical, sorcerers were far fromperfect. Not all their potions and spells succeeded.When they tried to cure diseases, the patient oftendied through severe poisoning – and the fate of thesorcerer was anyone’s guess. Perhaps the samecould be said of alchemists. Alchemy was themedieval dream of using a ‘philosopher’s stone’ tochange base metals like iron and lead into gold. Itwas a combination of chemistry, astrology, philoso-phy and mysticism, and took hold not only inEurope but in India and China too. No base metalwas ever transmuted into gold, but plenty of peoplespent their lives searching for the formula.

So what has this to do with marketing? In realitya great deal.

Let’s consider a Disney movie for a moment. In1940 the Disney Organization made a movie thathas stood the test of time, and remains one of thebest-animated movies ever created – Fantasia. Themovie is a series of vignettes involving animatedcharacters with their actions set to classical music.In one sequence Mickey Mouse™ is a Sorcerer’sApprentice who decides to find another solution tofilling the well other than his carrying buckets ofwater. Through magic he replicates a broom manytimes over and provides the replicants with armsand hands to carry the buckets. Having given thecommand to the brooms to fill the well he promptlyfalls asleep only to be woken by the flow of runningwater. The well has been filled to overflowing andpoor Mickey, now awake, doesn’t know how tostop the brooms filling the overflowing well. Panicsets in, but worse is to come as the Sorcerer returnshome to see mayhem. With one wave of the handcalm is restored except for a bedraggled apprentice.

In the section heading ‘medicine man’ wasincluded. There is some link to alchemists here inthat many were also considered healers, mostnotable being Paracelsus.2 Although medicine mencan be associated with native North Americans, thenative tribes of South America, Australia’s aborig-ines and African tribes, there is also an associationwith the charlatans who preached to communitiesin Victorian England and the emerging townshipsof 18th and 19th-century North America. These‘medicine men’ pronounced that they ‘held in theirhands a bottle that contained the elixir of life’. Atbest it was a rough alcohol, at worst it was a poison-ous concoction that could lead to an untimely andpainful death. Indeed many were simply known as‘snake-oil merchants’ doing little to promote theindividual seller or merchant in the then ‘WildWest’.

So what has any of this got to do with market-ing? I can see four separate, but linked, ways inwhich an analogy can be made.

1 Companies spend billions of dollars onmarketing campaigns that either help to selltheir goods or services, or do not. The literatureis full of companies that have implementedmarketing campaigns which for one reason oranother have failed. Therefore some of or all ofthe ingredients in this marketing potion werewrong, or incorrectly mixed.


2 Those with some knowledge of marketing donot always have enough knowledge to dealwith specific situations and the complica-tions that can ensue. It is sometimes claimedthat if you can market cars you can marketcosmetics – it’s all the same. This is a myth.An understanding of marketing principles isonly the start. Then you need to understandthe product or service you are marketing, notjust in broad terms but in depth. In the movieFantasia, Mickey as the apprentice had abasic understanding of the magician’s craft –but not sufficient to achieve what he set outto accomplish, hence the debacle at the end.Marketing comprises a series of techniquesor tactics that can be engaged as a part of anoverall marketing strategy. This, in turn,feeds into the corporate strategy. For amarketing strategy to be successful themarketer must understand what tactics touse, when and when not to use them, and inwhat proportion to use them and for howlong. It is a skill that is developed over time.

3 Marketers need to have a grip on reality.Research conducted at Cranfield University inthe United Kingdom by McDonald (2003)suggests that marketers, consultants andacademics have failed to understand the realdynamics of the marketplace. McDonald (2003)found that a significant number of seniormarketing practitioners revealed a depressing‘lack of knowledge about the financial impactof marketing expenditure’. He also contendsthat many companies fail to integrate market-ing within corporate strategy decision making,and to measure marketing performance (forexample, the link between customer retentionand profitability).

4 Marketing is not a cure for all ills. It. Forinstance, it cannot sell a product or service forwhich there is no market. It cannot turn aroundthe fortunes of a business that has no markets,no real product or an unsafe product, any morethan a government that has continually lied topeople can use spin to keep its majority in ademocracy. Thus marketers cannot be medi-cine men who turn a failed product or serviceinto an overwhelming success, no matter howmuch they believe they can, or how cleverlythey manipulate their clients and the public at

large. As with the snake oil merchants, the game will unravel, with disastrous consequences for all parties.

Earlier in this chapter a statement was made thatmarketing is neither a science nor an art. In factit is a hybrid drawing upon a diverse range ofdisciplines. Purists would disagree with thisview and suggest that it is really a science or anart. However, if you consider the range of disci-plines that marketing draws upon, it can reallyonly be classed as a hybrid. Those less disposedto such a description may call marketing a ‘thiefin the night who steals ideas from other disci-plines’. Whichever view you are predisposed totake, remember that it is a ‘potion’ that cannotcure all ills. Many marketers have believed thatthey can build a brand in such a way as to gainand sustain competitive advantage, only to see itfalter and fail. Equally, organisations have failedto harness the possibilities that marketing maybe able to deliver, to in turn falter and fail.

Therefore marketing must be viewed objectively,and a course in marketing does not make amarketer. It is experience, and the knowledgegained from that experience, that makes for apotentially more objective and thus ‘successful’marketer.

■ Marketing as anorganisational function

While marketing is central to most organisations,it does not stand alone. Figure 1.5 shows a typical arrangement of functional units within anorganisation. Each unit has separate functions,procedures and staff, but they are also integratedwithin the organisation as a whole.

Marketing cannot operate without finance,operations, HRM and other functions within anorganisation. Table 1.1 illustrates the linkagebetween Marketing and other functional unitswithin the organisation.

When marketing works effectively in concertwith other functional units, the organisation has an opportunity to create an efficient corpo-rate strategy. Unfortunately, though, manyorganisations operate in a manner that pays onlylip service to functional integration. The organi-sation might survive in the short term, but its

ALCHEMIST, MAGICIAN, SORCERER AND MEDICINE MAN 11

longer-term future could be in jeopardy, as this isan inefficient use of valuable internal resources.Business history is littered with examples ofcompanies that were once powerful but havesince gone bankrupt, or have been acquired andmerged into other businesses. In many casestheir collapse has been caused by a lack of func-tional integration and a dynamic and soundcorporate strategy.

■ Who is engaged in marketing?It would probably be very difficult to find agroup or organisation that is not, in some way oranother, engaged in marketing. Even tribeswithin remote jungles often engage in tradethrough barter. They are ‘selling’ and exchangingproduce to gain a mutual benefit.

Table 1.2 outlines the various groups involved inmarketing. The objective here is to consider the vastarray of organisations involved in marketing opera-tions, and the groups to which they market. B2C andB2B are widely acknowledged abbreviations, but theother abbreviations given are less well established.

As you can see from the table, every one of us,

in both our working and private lives, has adirect or indirect link to marketing activity. Wemight take it for granted, but it is with us all ourwaking lives.

■ Marketing now andtomorrow: current and futuretrends

Initially it may seem out of place to comment onfuture trends towards the end of the first chapter.However, in attempting to understand whatmarketing is, we need to consider and analysewhere marketing is positioned today, and where itmay be positioned in the future. While there arenumerous industry watchers, in the main the focusof investigation has been the work of the MarketingScience Institute (MSI). In its research it hasoutlined the key developments and research topicsover a ten-year period (see Table 1.3). Many of theissues raised in the MSI research are discussed inthis text. However, it is worth briefly consideringwhat might be the ‘hot’ marketing topics over thenext years or so.


Figure 1.5 Marketing within an organisational context

Board of Directors or Governing Committee

Marketing

Marketing Director

FinanceDirector

OperationsDirector

HRMDirector

Marketingteam Finance team Operations team HRM

team

Finance Operations Human Resource Management

MARKETING NOW AND TOMORROW

Marketing’s relationship with

Description/comment

Accounting & Finance Provides the finance, maintains bank accounts and advises budget preparation.Allocatesthe funds for marketing activities.

Operations Marketing works with operations to meet customer needs and wants.The marketing department needs to sell to the quantity of products that can be realistically produced by operations.

Human ResourceManagement

Develops a Human Resource Strategy for the organisation. Involved in the recruitment of suitable staff (all levels) to work within the marketing department.Theinstigation of appropriate structures and operational procedures including those legallyenforceable such as working hours directives (European Union).

Facilities This unit provides the resources that enable organisations to function: for example, stationery and other consumables, computers, furniture, telephones and cleaning.

2004–14?

It is easy to speculate; that is part of the fun. So hereis some blue-sky thinking for the future:

� There will be stronger links between marketingand strategy. It will be the real strategicthinkers who will be able to leverage productsor services into the marketplace. Indeed themarketplace may increasingly be looked uponas a battlespace where companies compete formarket share.

� Competitive sustainability will becomeincreasingly hard to maintain within a globalbusiness environment. More of the developingnations will attain developed status, and havethe products and services to compete withestablished companies and brands head tohead. The major brands of the future might benot American or European, but Indian, Africanand Chinese. China-based companies havealready created several major brands.

� The marketing mix and relationship marketingwill combine to form a new approach to howcompanies and organisations relate to theircustomers.

� Information will be the key to success in thecompetitive world of the future. Thus compet-

itive intelligence and marketing research willform the platform for the development of newmarketing information systems, incorporatingreal-time analysis.

� Computing power will increase, and lead tomore embedded systems within the home andoffice that act on behalf of customers. Forinstance, remote systems will order productsand services automatically. Thus will market-ing messages need to be directed to the homecomputer system rather than the home owner?Will customers use home computers to removethe marketing clutter from their lives?

� The World Wide Web and the Internet willgrow – but what form will they take, how willwe interact with them, and on what scale?Whatever the answers, companies will need tobe both proactive and reactive to meet theneeds of customers working and living incyberspace.

� Measurement will be critical to truly under-standing success or failure. Computer systemswill drive the mathematics to interpret real-time movements in products and services.

� Customers will seek deliveries at times thatsuit them. While some companies are alreadyproviding such services, not all companieshave realised that customers will switch

Table 1.1 Marketing relationships

13


Table 1.2 Groups involved in marketing

Group Abbreviation Description/comment

Business to consumer

B2C A business (an individual or a multinational company) markets a product orservice directly to the consumer – the end user. For example, cruise lines market a Caribbean cruise to potential and current consumers.

Business to business

B2B Businesses market directly to other businesses. For example, food suppliersmarket their produce to a cruise line, a hair care company supplies a hairdresser with shampoos and conditioners, or an engine manufacturer supplies a jet engine to a aircraft manufacturer.

Business to employees

B2E This is also known as internal marketing. Here the organisation is marketing, forexample ideas, new practices or a restructuring, to its employees.While not allthe elements of the marketing mix (see Chapter 8) are used, key fundamentalssuch as promotion will be.

Business to government

B2G This can be approached from two angles. First, a business or an industry couldlobby government to adopt or amend a piece of legislation (see Chapter 10 onPromotion). Second, a business can market its products or services directly togovernment.This covers everything from office furniture to the contract tobuild the latest nuclear-powered aircraft carrier.

Business to non-governmental organisations

B2NGO Companies market special facilities and equipment to NGOs, especially for disaster relief: for instance, medicines, rescue equipment (inflatable boats) andtransport (heavy lift aircraft that can transport large quantities of relief suppliesinto terrain-difficult areas).

Government to business

G2B Governments market their services to businesses and industry. For example,governments may financially support home-country companies or organisationsto attend international exhibitions in order to win orders. Such actions canassist in providing a healthy balance of payments (see Chapter 2,The marketingenvironment). Equally, governments market to companies in other countries.Both the French and Spanish governments marketed their countries to theDisney Organization when Disney considered building a theme park in Europe.In such cases governments offer incentives such as providing infrastructures(road and rail networks), tax incentives and low-cost land.

Government topeople

G2P Democratically elected governments market their policies to the nation. Suchgovernments usually seek to explain why they have increased personal incometax. For example, by stating that it will be allocated to improve health care foreveryone. Equally governments market their national identities, not just to theirown people but also other nationalities.This is usually achieved through nationaltourist boards as a means of persuading people in other countries to visit astourists.

People to government

P2G The focus here is a particular aspect of public relations, namely lobbying. In thiscase interested parties or special interest groups (SIGs) market their cause togovernment.This is usually aimed at persuading the government to introduce,modify or remove a piece of proposed or actual legislation. Lobbyists can eitherbe individuals or more normally groups (of varying sizes). Recent examples inthe UK of such P2G activity have been proposals to lower the consenting agefor gay relationships and whether or not fox hunting should be banned.

MARKETING NOW AND TOMORROW 15

brands based upon delivery slots. This isbecause people’s time is increasingly limited.Companies that cannot adapt their distributionchannels to meet customer demands will notsurvive.

� Customers will seek the best deal for them, sobrand switching will increase. Companies thusneed to position themselves in the group ofbrands that customers consider. There will nolonger be single brands of choice.

� Consumers will seek higher ethical standardsfrom companies and organisations. The scan-dals of the late 1990s and early 21st centuryhave cost stakeholders significantly, forinstance, in stock values, life savings and prod-uct–service quality. Organisations that fail tomeet higher standards will see increasingshareholder power and boycott action.

� Clearly these are major issues. However,perhaps the greatest concern facinghumankind is the threat of global warming andglobal dimming (see Chapter 2). Individuals,

companies and governments must considerthe reality of this environmental threat, andhow they tackle this issue might determine theoutcomes of many of the trends suggestedabove.

These are thoughts based upon current trends.However, as we live in an increasingly turbulentworld it is really difficult to predict developmentsover the next few years. Whatever happens it willbe a challenge for marketers, no matter what typeof organisation they work in.

■ Chapter summaryThis chapter has briefly considered some of thedevelopmental aspects of marketing, the organisa-tion of marketing, who is involved in the marketingfunction, and possible future trends. It has statedthat marketing is an amalgamation of various disci-plines, so it is dependent on research and develop-ment in many disparate subject areas in order for itto evolve further. Equally, marketers must accept

Table 1.2 continued

Group Abbreviation Description/comment

People tobusiness

P2B This can be viewed as lobbying and/or boycotting activities. Customers [individuals and groups (free-forming or organised)] may actively lobby/boycott abusiness in order to force the business to modify its actions or policies. Forexample, consumers have boycotted companies such as Benetton, Nestlé andShell over specific practices.

Governmentto government

G2G Governments market to other governments, for example, in support of indige-nous companies that are pursuing contracts abroad. Equally, one government mayuse public relations tactics (see Chapter 10) to lobby another government toreduce barriers to market entry (protectionism).

Non-governmentalorganisationsto business

NGO2B This is marketing activity that supports good works.An example is UNICEF, theUnited Nations’ fund for the care and welfare of children worldwide. Such organisations will actively market to both businesses and organisations that theybelieve will help fund their welfare programmes in various countries around theworld.

Non-governmentorganisationsto consumersor non-governmentorganisationsto people

NGO2C orNGO2P

Throughout the year but especially at the time of national disasters NGOs mar-ket the need for support from individuals, usually in the form of donations.Anexample is the earthquake that devastated the ancient city of Bam in Iran onChristmas Day 2003 killing an estimated 30,000 people. NGOs, such as theInternational Red Cross and UNICEF, immediately issued appeals for donations tohelp the thousands who had been made homeless.

that they too need to explore other disciplines, notonly to further the subject but to see how theirorganisation will compete in the future.

■ Questions for review andreflection

1 Briefly outline the development of marketingas a subject area for study. Why do you thinkmarketing has taken such a route?

2 Do the definitions illustrated in this chapterreflect how you interact with marketing activity?

3 Debate with a group of fellow students themeaning of marketing, and see if you canconstruct your own definition.

4 ‘Everyone is engaged in the marketingprocess.’ Discuss this statement.

5 Why do you think that so much emphasis isplaced on the study of marketing within busi-ness degree programmes?

6 Various suggestions were put forward as to thefuture development of marketing. Do youagree with these suggestions? What otherdirections do you think marketing could takein the future?

7 Do you think the term ‘marketing’ has a future?This may be a question to reflect on after youhave considered the contents of this book.

■ ReferencesAmerican Marketing Association (AMA) (1948)

‘Report of the definitions committee’, Journal ofMarketing 13 (October), p. 202.


Figure 1.6


An example of a B2G product.These are speciallydesigned fire-fighting flying boats.They collect water inspecial tanks as they skim across a lake or sea, then flyover a bush or forest fire releasing the water to dampen the flames.These particular aircraft were inaction in Corsica. However, they are operated by fireservices (usually government agencies) in various countries around the world.

Figure 1.7


This is a familiar sight in most high streets around theworld – an eye-catching store window display. It is anexample of B2C marketing.

17

AMA (1960) Marketing Definitions: A glossary of marketing terms, Chicago: AMA.

Cooke, E. F., Rayburn, J. M. and Abercrombie, C. L.(1992) ‘The history of marketing thought asreflected in the definitions of marketing’, Journal ofMarketing – Theory and Practice, Fall, pp. 10–20.

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Eldridge, C. E. (1970) Marketing for Profit,London: Macmillan.

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Kotler, P. (2000) Marketing Management, Millenniumedn, Harlow: Prentice Hall.

Lehmann, D. R. (2002) ‘What’s on marketers’ minds?’,Marketing Management 11(6) (November/December), pp. 16–20.

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McDonald. M. (2002) Marketing Plans: How to preparethem; how to use them, Oxford: Butterworth-Heinemann.

McDonald. M. (2003) ‘Marketing died in the lastdecade’, Interactive Marketing 5(2) (October/

Table 1.3 Key trends in marketing research according to the MSI

Source: Lehmann (2002).

1994–6 1996–8 1998–2000 2000–02 2002–04

Successfully introducing newproducts

Customers and consumers

Marketing metricsand performancemeasurement

E-business/e-commerce/impactof the Internet

Assessing marketing productivity (returnon marketing) andmarketing metrics

Market orientation Innovation and newproducts and markets

Understanding thecustomer experience

Metrics/measuringmarketing performance

Brands and branding

Customer relationships

Information technology and newmedia

Marketing and theInternet

Branding Managing customers

Information technology and theinformation highway

Marketing management organisations andprocesses

Relationship marketing

Managing customer relationships

Growth, innovationand new products

Marketing engineering andempirical generalization

Global marketing Managing brands:brand equity,product management

Collecting and usingmarketing knowledge

Understanding customers

Managerial use ofinformation

Management use ofinformation and market research

Marketing innovation: creatingcustomers, creatingnew products

New product/innovation

The role of marketing

Brand equity andproduct management

Brand equity andproduct and brandmanagement

Marketing knowledge management

Communications Collecting,interpreting andusing information

MARKETING NOW AND TOMORROW


December), pp. 144–59.McNair, M. P., Brown, M. P., Leighton, D. S. R. and

England, W. B. (1957) Problems in Marketing, 2ndedn, New York: McGraw-Hill.

Mercer, D. (1997) New Marketing Practice: Rules forsuccess in a changing world, London: Penguin.

Oxenfeldt, A. R. (1966) Executive Action in Marketing,Belmont: Wadsworth.

Pyle, J. F. (1931) Marketing Principles, New York:McGraw-Hill.

Star, S. H., Davis, N. J., Lovelock, C. H. and Shapiro, B.P. (1977) Problems in Marketing, New York:McGraw-Hill.

Wren, D. (1979) The Evolution of Management Thought,2nd edn, New York: Ronald Press.

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