The American Marketing Association has defined marketing as 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. We can also think of marketing, more
simply, as the activities buyers and sellers perform to facilitate mutually satisfying exchanges.
In the past marketing focused almost entirely on helping the seller sell. That’s why many people
still think of it as mostly selling, advertising, and distribution from the seller to the buyer. Today,
much of marketing is instead about helping the buyer buy.
The future of marketing is doing everything you can to help the buyer buy. The easier a marketer
makes the purchase decision process, the more that marketer will sell. 2
. Marketing in the United States has passed through four eras: (1) production, (2) selling, (3)
marketing concept, and (4) customer relationship. Today, a new era is emerging: mobile/on-
The production era
From the time the first European settlers began their struggle to survive in America until the
early 1900s, the general philosophy of business was “Produce as much as you can, because there
is a limitless market for it.” Given the limited production capability and vast demand for
products in those days, that production philosophy was both logical and profitable. Business
owners were mostly farmers, carpenters, and trade workers. They needed to produce more and
more, so their goals centered on production.
The selling era
By the 1920s, businesses had developed mass-production techniques (such as automobile
assembly lines), and production capacity often exceeded the immediate market demand.
Therefore, the business philosophy turned from producing to selling. Most companies
emphasized selling and advertising in an effort to persuade consumers to buy existing products;
few offered extensive service after the sale.
The marketing concept era
Businesses recognized that they needed to be responsive to consumers if they wanted to get their
business, and a philosophy emerged in the 1950s called the marketing concept.
The marketing concept had three parts:
1. A customer orientation. Find out what consumers want and provide it for them. (Note the
emphasis on meeting consumer needs rather than on promotion or sales.)
2. A service orientation. Make sure everyone in the organization has the same objective:
customer satisfaction. This should be a total and integrated organizational effort. That is,
everyone from the president of the firm to the delivery people should be customer-
oriented. Does that seem to be the norm today?
3. A profit orientation. Focus on those goods and services that will earn the most profit and
enable the organization to survive and expand to serve more consumer wants and needs.
The customer relationship era Customer relationship management (CRM) is the process of learning as much as possible about
present customers and doing everything you can over time to satisfy them—or even to exceed
their expectations—with goods and services. 6 The idea is to enhance customer satisfaction and
stimulate long-term customer loyalty.
Nonprofit organizations and marketing
States use marketing to attract new businesses and tourists. Many states, for example, have
competed to get automobile companies from other countries to locate plants in their area.
Schools use marketing to attract new students. Other organizations, such as arts groups, unions,
and social groups, also use marketing. The Ad Council, for example, uses public service ads to
create awareness and change attitudes on such issues as drunk driving and fire prevention.
We can divide much of what marketing people do into four factors, called the four Ps to make
them easy to remember. They are:
Managing the controllable parts of the marketing process means (1) designing a want-satisfying
product, (2) setting a price for the product, (3) putting the product in a place where people will
buy it, and (4) promoting the product. These four factors are called the marketing mix because
businesses blend them together in a well-designed marketing program
Once you’ve researched consumer needs and found a target market (which we’ll discuss in more
detail later) for your product, the four Ps of marketing come into play. You start by developing a
product or products. A product is any physical good, service, or idea that satisfies a want or
need, plus anything that would enhance the product in the eyes of consumers, such as the brand
It’s a good idea at this point to do concept testing. That is, you develop an accurate description
of your restaurant and ask people, in person or online, whether the idea of the restaurant and
the kind of meals you intend to offer appeals to them. If it does, you might go to a supplier that
offers vegetarian products to get the ingredients to prepare samples that you can take to
consumers to test their reactions. The process of testing products among potential users is
called test marketing
You may want to offer some wellknown brand names to attract people right away. A brand
name is a word, letter, or group of words or letters that differentiates one seller’s goods and
services from those of competitors. Brand names of vegetarian products include Tofurky, Mori-
Nu, and Yves Veggie Cuisine.
After you’ve decided what products and services you want to offer consumers, you have to set
appropriate prices. Those prices depend on a number of factors. In the restaurant business, the
price could be close to what other restaurants charge to stay competitive. Or you might charge
less to attract business, especially at the beginning. Or you may offer high-quality products for
which customers are willing to pay a little more (as Starbucks does). You also have to consider
the costs of producing, distributing, and promoting the product, which all influence your price. Such intermediaries are the middle links in a series of organizations that distribute goods from
producers to consumers. (The more traditional word for them is middlemen.) Getting the product
to consumers when and where they want it is critical to market success
Promotion consists of all the techniques sellers use to inform people about and motivate them to
buy their products or services. Promotion includes advertising; personal selling; public relations;
publicity; word of mouth (viral marketing); and various sales promotion efforts, such as coupons,
rebates, samples, and cents-off deals.
Promotion often includes relationship building with customers. Among other activities, that
means responding to suggestions consumers make to improve the products or their marketing,
including price and packaging. For Very Vegetarian, postpurchase, or after-sale, service may
include refusing payment for meals that weren’t satisfactory and stocking additional vegetarian
products customers say they would like. Listening to customers and responding to their needs is
the key to the ongoing process that is marketing.
Every decision in the marketing process depends on information. When they conduct marketing
research, marketers analyze markets to determine opportunities and challenges, and to find the
information they need to make good decisions.
Marketing research helps identify what products customers have purchased in the past, and what
changes have occurred to alter what they want now and what they’re likely to want in the future.
Marketers also conduct research on business trends, the ecological impact of their decisions,
global trends, and more. Businesses need information to compete effectively, and marketing
research is the activity that gathers it
The Marketing Research Process
A simplified marketing research process consists of at least four key steps:
1. Defining the question (the problem or opportunity) and determining the present situation.
2. Collecting research data.
3. Analyzing the research data.
4. Choosing the best solution and implementing it.
Usable information is vital to the marketing research process. Research can become quite
expensive, however, so marketers must often make a trade-off between the need for information
and the cost of obtaining it. Normally the least expensive method is to gather information already
compiled by others and published in journals and books or made available online.
Such existing data are called secondary data, since you aren’t the first one to gather
them. Despite its name, secondary data is what marketers should gather first to avoid incurring
Often, secondary data don’t provide all the information managers need for important business
decisions. To gather additional in-depth information, marketers must do their own research. The results of such new studies are called primary data. One way to gather primary data is to
conduct a survey.
Telephone surveys, online surveys, mail surveys, and personal interviews are the most common
forms of primary data collection. Focus groups (defined below) are another popular method of
A focus group is a group of people who meet under the direction of a discussion leader to
communicate their opinions about an organization, its products, or other given issues