What is Marketing? Pulling It All Together

At the start of this chapter, Figure 1.1 presented a simple model of the marketing process. Now that we've discussed all of the steps in the process, Figure 1.6 presents an expanded model that will help you pull it all together.

What is Marketing?

Simply put, marketing is the process of building profitable customer relationships by creating value for customers and capturing value in return. The first four steps of the marketing process focus on creating value for customers. The company first gains a full understanding of the marketplace by researching customer needs and managing marketing information. It then designs a customer-driven marketing strategy based on the answers to two simple questions. 

The first question is " What consumers will we serve ? " ( market segmentation and targeting ). Good marketing companies know that they cannot serve all customers in every way. Instead, they need to focus their resources on the customers they can serve best and most profitably. The second marketing strategy question is " How can we best serve targeted customers? "

 ( differentiation and positioning ). Here, the marketer outlines a value proposition that spells out what values. the company will deliver in order to win target customers. With its marketing strategy decided, the company now constructs an integrated marketing program - consisting of a blend of the four marketing mix elements, or the four Ps that transforms the marketing strategy into real value for customers. The company develops product offers and creates strong brand identities for them. 

It prices these offers to create real customer value and distributes the offers to make them available to target consumers. Finally, the company designs promotion programs that communicate the value proposition to target consumers and persuade them to act on the market offering. Perhaps the most important step in the marketing process involves building value-laden, profitable relationships with target customers. Throughout the process, marketers practice customer relationship management to create customer satisfaction and delight. 

In creating customer value and relationships, however, the company cannot go it alone. It must work closely with marketing partners both inside the company and throughout the marketing system. Thus, beyond practicing good customer relationship management, firms must also practice good partner relationship management. The first four steps in the marketing process create value for customers. 

In the final step, the company reaps the rewards of its strong customer relationships by capturing value from customers. Delivering superior customer value creates highly satisfied customers who will buy more and will buy again. This helps the company to capture customer lifetime value and a greater share of customers. The result is increased long-term customer équity for the firm. 

Finally, in the face of today's changing marketing landscape, companies must take into account three additional factors. In building customer and partner relationships, they must harness marketing technology, take advantage of global opportunities, and ensure that they act in an ethical and socially responsible way. 

Figure 1.6 provides a good road map to future chapters of the text. Chapters 1 and 2 introduce the marketing process, with a focus on building customer relationships and . capturing value from customers. Chapters 3, 4, 5, and 6 address the first step of the marketing process - understanding the marketing environment, managing marketing information, and understanding consumer and business buyer behavior. 

Next, we look more deeply into the two major marketing strategy decisions: selecting which customers to serve ( segmentation and targeting ) and deciding on a value proposition ( differentiation and positioning ). Chapters 8 through 17 discuss the marketing mix variables, one by one. Chapter 18 sums up the customer-driven marketing strategy and creates a competitive advantage in the marketplace. Then, the final two chapters examine special marketing considerations: global marketing and marketing ethics and social responsibility.