Saturday, June 13, 2009

2. I love what I do, but marketing, that stresses me out: Understanding Marketing

Are you one of those people who has something beautiful to offer to this world, but does not feel comfortable marketing it? This blog posting is a response to people’s fears and misperceptions about marketing. There are many (mis)interpretations of what marketing is and the purpose of this blog is:

1) To bring awareness to some reasons for negative perceptions about marketing

2) To clarify the meaning of marketing and differentiate it from related terms like selling and advertising

3) To lay out the eight steps in marketing as a systematic and natural aspect of living a mindful life

I started writing this posting as one, but it ended up being so long that I have split it into three separate postings, addressing each of the purposes stated above separately.

So, what is marketing? What purpose does it serve?

Part 2 of 3 of “I love what I do, but marketing, that stresses me out.”

According to the American Marketing Association, the largest marketing association in North America, “Marketing is 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.” The Chartered Institute of Marketing, which is noted as the world's largest marketing body, defines marketing as "The management process responsible for identifying, anticipating and satisfying customer requirements profitably." The two definitions bring out the essence of marketing, which is understanding people’s needs and finding ways to meet those needs in a way that is beneficial to the customers, partners, and society at large. Now, companies can deviate from this purpose or do a bad job of implementing the purpose, but marketing is intended to perform a very important function in society.

I will briefly lay out the scope of the marketing strategic process so we do not confuse marketing with a small aspect of it and can truly appreciate the potential it has to benefit the world. Marketing strategy involves three stages – planning, implementation, and control. I will be focusing on the planning stage in this blog. Implementation basically refers to systematically implementing the plan and control refers to comparing the results with the plan to evaluate performance and make required improvements.

The eights steps in a marketing plan

1) Your business mission: The first step is having a clear mission statement, which defines your business’s core purpose, specific needs you will be satisfying of your target market, and your unique competencies that sets you apart from other businesses. The mission statement provides the framework for setting your objectives, values, and your business culture.

2) The situational scan: This step involves what is generally called the SWOT analysis. The SWOT analysis stands for a systematic study of the firm’s inner strengths and weaknesses and the opportunities and threats in the firm’s external environment. It is important for the business to stay in touch with factors in the environment that affect its business like the changes in consumer culture, technology, competitors, the economy, and political changes.

3) Your target market: If you try to make everyone happy, you will not make anyone happy. Based on an understanding of what you have to offer and the environment decide on what kind of consumers you will be serving. Try to get as much information about your target market as possible, like demographics, personality traits, their lifestyles, their preferences of communication channels, their needs, any other information that helps you understand and serve them better.

4) Your positioning: This step requires that you identify how you will meet your customers’ requirements uniquely vis-à-vis other businesses. What is it that you will be doing that is different from others? How do you want people to see you? What is your brand personality? You can differentiate your product or service along different variables like product attributes, pricing, services that you provide, brand personality, and channels of distribution. For example, Dell has positioned itself using price as an advantage while Apple has used its strong innovation and style as differentiating features.

5) Product; This step deals with specifying the product features and attributes and relating those with customers’ needs. It includes new product developments, services and warranties, and branding activities.

6) Promotion: This aspect of marketing involves all those activities that inform customers about your product with the purpose of building a brand image and/or sales. It includes advertising, sales promotions, publicity, and personal selling.

7) Price: This step involves setting a price for your product, including all discounts. There are many ways to determine the right price for your product. The easiest pricing strategies are based on your cost plus adding a margin and using competitors as a reference point.

8) Place: This step involves deciding the ways in which the product will be made available to your customers. It requires selecting all the distribution channels that are most expedient for delivering the products available to your customers. For example, many big companies use a combination of channels such as the internet, retail outlets, and catalogs to make their products easily accessible to their customers.

The eight steps illustrate that marketing is more than advertising and sales. In fact, advertising and sales are one aspect of promotion, which is only one of the eight essential elements in a marketing plan. Now you know what marketing entails. But this presents new problems - someone new to marketing may find it intimidating to think of all these things that need to be done to make your product available to your customers. So, next I am sharing a new perspective on what I like to call mindful marketing, which is a natural outcome of who you are and not something you need to do.

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