Introduction to marketing

The American Marketing Association defines marketing as:

The process of planning and executing the conception, pricing, promotion, and distribution of
ideas, goods, and services to create exchanges that satisfy individual and organizational
objectives
NATURE OF MARKETING
1. Marketing is Consumer-oriented:
A business exist to satisfy human needs. Therefore, business must find out what the
customers want and then produce goods according to the needs of the consumers.
Only such products should be produced which best satisfy consumer needs and at the
profit to the maker.
2.

Marketing Starts and ends with the consumer:

Marketing is concerned only with the flow of goods and services from the producer to the
consumer. Under consumer-oriented marketing it is essential to know what the customers
really want and this is only possible if we collect information from consumers.

3. Modern Marketing Precedes and succeeds Production.

Today, all the organization s accepts that the marketing activities must start far ahead of
production. It is not enough if the activities are begun after the product is ready.
Marketing would have authority over product innovation and planning, production
scheduling as well as over the sale. In companies operating under the marketing concept
entire marketing is designed to serve consumer needs.
4. Modern Marketing is the guiding element of the business:
Marketing has become a pervasive force capable of guiding and even controlling
production. In fact, it is the market potential and not production resources that guide a
business today. This involves the integration of a number of activities from the
conception of a product idea to its profitable selling and ultimate consumption.
5. Marketing is a Science as well as Art:
Marketing is an art in the sense that a considerable body of rules or principles on buying,
selling, financing, standardization, market information etc. has been put into practice to
achieve success in the economic life of man.
But later development has changed the art base of marketing into a science base. Many
aspects of marketing are becoming increasingly technical. This has created the need for
complex tools of measurement and experimentation. Hence, it is not wrong to say
marketing is science-based.

6. Marketing is a System:
Marketing is a System consisting of several interdependent and interacting sub-systems.
It obtains the inputs from the environment (Supra system), transforms these inputs and
supplies the output (customer satisfaction, profits etc)
7. Exchange process is the Essence of Marketing
Exchange implies transactions between buyers and seller. The seller hands over a product
or service to the buyer who in turns gives money. There is exchange of information
between buyers and sellers.
8. Marketing is Goal-oriented:
The ultimate aim of marketing is to generate profits through the satisfaction of human
wants.
The following aims are sought to be achieved by studying marketing:
1. To provide guiding policies regarding marketing procedures and their
implementation.
2.
To study marketing problems according to circumstances and to suggest
solutions.
3. To analyse the shortcomings in the exiting pattern of marketing.
4. To enable managers to assess and decide a particular course of action.
5. To develop an intelligent appreciation of modern marketing practices.
9. Marketing is a Process:
It is a dynamic process because it keeps on adjusting to the changes in the environment of
business. Marketing is also a social process in the sense that it is concerned with human
needs. Marketing is a managerial process as it involves the functions of planning and
control

SCOPE OF MARKETING
The scope of marketing is very wide. It may be analyzed in the term of marketing performance
through various functions. These functions are to be performed on the basis of various utilities.

A)
Functions
of
Exchange

1. Buying Function
2. Assembling Function
3. Selling Function

MARKETIN
G
FUNCTION
S

B) Functions
of Physical
Distribution

C) Functions
of
Facilities

1.
2.
3.
4.

Transportation
Inventory Management
Warehousing
Material Handling

1.
2.
3.
4.

Financing
Risk Taking
Standardization
After Sales Service

A) Functions of exchange:
Buying Function: A manufacturer is required to buy raw materials for production
purposes. Similarly, a wholesaler has to buy goods from manufacturer for the purposes of
sales to retailers. Retailer has to sell the goods to consumers. Thus functions of buying
have to be performed at various levels.
Assembly Function: Assembling is different and separate from buying. Buying involves
transfer of ownership of the goods from seller to the buyer; whereas in assembling, goods
are purchased from various sources and assembled at one place to suit the requirement of
the buyer.
Selling Function: Selling involves transfer of ownership from seller to the buyer. Selling
function is vital to the success of any firm. Its importance has been continuously
increasing in all organizations due to the emergence of severe competition. Producing
goods is easy but it is very difficult to sell them.
B) Functions of Physical Distribution:
Transportation: it is the function of transformation to carry commodities from where utility is
relatively low to places where it is higher.
It includes decision to be taken on

Modes of transport
Claims etc
Service
Selection
Freight

consolidation

Processing,
Vehicle scheduling

VECHILE SCHEDULING
Vehicle Scheduling is part of the component Transportation Planning. It enables the
transportation planner to optimally use available capacities of trucks, trains, ships, and airplanes
with the goals of more efficiently planning loading capacities and lowering costs, since most
customers nowadays depend completely on external transportation companies for optimum
transportation (which means deliveries that are on time and cost saving).

PROCESSING
The aim of transportation processing is to complete the formalities involved in getting a
shipment ready for dispatching to the customer. Tasks in transportation processing include
weighing the shipments, loading, and goods issue posting as well as recording information on the
means of transport such the drivers details, the weight of the truck, and the time it arrive
premises.

Inventory Management :
It includes

Short term sales forecasting

Product mix at stocking points

JIT or push or pull

strategies
Number, Size & location
of stocking points

Warehousing:
Warehousing help in having a central place for keeping goods from where the distribution
could be made easily and according to needs. Ultimately, it tends to adjust the supply to
demand so as to equalize them in the interest of the manufacturers, middlemen and
consumers.
It includes

Space determination
Stock layout and design

Stock placements

Material Handling:
It includes

Equipment Selection
Equipment replacement

C) Functions of Facilities:
1. Financing

Order picking procedure

Stock storage & retrieval

Arrangement of finance has become an increasingly important function. Therefore, a

marketer can plan for various kinds of finance: short term finance, Medium term finance
and Long term finance.
There are various sources of finance for example, commercial banks, co-operative banks,
credit societies, government agencies etc.
2. Risk Taking :
There are innumerable risks in the process of marketing of goods and services. Risks
arise due to unforeseen circumstances. Risks can be insured also. For example, the risk
due to fire and accidents may be covered by insurance. But the risks due to changes in
government policies, risks due to increased competition, technological risks and business
cycle risks cannot be insured.
3. Standardization:
Buyers and sellers always prefer to have standardized goods and services. This will
relieve buyers from examining the product and wasting time. That is why standardization
has now been accepted as a convenient and ethical basis of marketing.
4. After sales service:
The importance of after sales service facilitates as a marketing tool cannot be ignored.
Hence arrangement of after sales service has become an increasingly important function.
Therefore, a marketer has to plan for after sales service.
For example: Repairs, replacements, maintenance etc.
5.

Marketing Information:
Modern marketing requires a lot of information accurately, adequately and promptly. This
information becomes the basis of many decision in marketing. Marketing information
makes a seller know when to sell, at what price to sell, who are the competitors etc.
marketing information and its proper analysis has led to marketing research.