The term marketing encompasses all those specialized activities and processes through which goods and services reach from the producers to consumers in such a way that the consumers’ satisfaction or utility is maximized and societal well being is enhanced. Functions of marketing revolve around the strategies that enable a brand, business, manufacturer or a company to widen its reach by knowing what its customers want and then connect, convince and convert those customers for their products and services.
Thus it can be considered as an act which links the customer and the producer.
Experts consider marketing as an art as well as a science that is quite crucial for the success of any business, as with the help of marketing; products and services are brought into the place of consumption.
For a layperson, marketing may seem synonymous with selling, but it is way beyond that. The marketing process begins with the conceptualization of the potential outcome. The end-stage is reached when the product reaches the final customer/consumer.
Between the former and the latter, several key stages exist, all of which are collectively referred to as the functions of marketing. A key feature of all the purposes of marketing is that they are interrelated and interconnected.
In this post, we will dive deep into the world of different functions of marketing and what their key roles are in channelizing a business. So, let us get started with the introduction to the functions of marketing.
What are the Functions of Marketing?
The genesis of marketing as a specialized component of commerce is traced to the twentieth century. It has also marked the dawn of the industrial era in history.
Till the early twentieth century, marketing functions were widely absent. It was because the commodities were of reasonable quality and nature, and were disposed of in vast by the ‘sales-organizations’.
In the 1920s, the concept of marketing originated and was closely associated with advertising. Products were advertised, and their quality, grade, price, and durability were identified. As the industrial revolution progressed, in the 1930s, product differentiation was introduced.
Traditionally, the marketing functions involved exchange functions, storage, finance, risk management, transportation, grading, standardizing, labeling and packing and the like.
However, in this digital age of technology and information, where the change outpaces generations, marketing is a race without a finish line.
As a result, new functions of market information have attained far greater importance.
To bring you the facts and bust all the myths about the functions of marketing, 13 essential functions of marketing are outlined as follows:
1. Market Research
It predominantly involves identifying the needs and wants of consumers.
The aim here is to generate adequate information regarding the particular ‘target’ market. The underlying principle is to understand the customers.
Earlier, market research was focused on increasing sales rather than understanding customers. Over time, the need to understand the buyers was recognized.
Perhaps this old Spanish saying exemplifies this new change:
“To be a bullfighter, you must first learn to be a bull.”
2. Marketing Planning
These objectives may range from increasing market share to dominate the market. An ideal marketing plan imbues the confidence that the company will win the war even before fighting its first battle.
A marketing plan spells out the threats, opportunities, weaknesses, and strengths of the company. Based on these, the policy sets goals and a time frame for achieving them. It also outlines the budget that would be required to achieve these goals.
Furthermore, it includes measures and review periods that would gauge whether progress is being made or not. The most important part, however, is to implement the plan. Marketing plans will not yield any returns if they are not implemented.
3. Product Designing and Development
The development of a product is based on the results of market research. After assessing what the consumers want, a product is developed.
Other factors that play a role in the development of the product include potential costs, prevalent technology, etc.
Designing, on the other hand, facilitates development. It provides a set of tools and concepts for developing successful products and services.
Product design focuses on various attributes of the potential outcome. These include being easy to assemble, easy to use, easy to repair and easy to dispose of. The design also provides a competitive advantage in the market.
4. Grading and Standardization | Functions of Marketing
Standardization means producing goods of predetermined standards. Uniformity is necessary for agricultural as well as manufactured products.
It ensures that all the articles of a given product are homogeneous and uniform. Standardization is essential for gaining the trust of the buyers. It assures the buyers of quality, price, and packaging of the product. Conformity to a standard of quality ensures consumer allegiance, sustained growth and earnings.
Grading, on the other hand, means sorting the supply of a given commodity as per specified or fixed norms or standards. These include classifying based on quality, size, quantity et cetera.
5. Packaging and Labeling
The package and label cast the first impression on the buyer.
In addition to protecting the goods from deterioration and damage, they also act as promotional tools.
The packaging is often called the fifth P, an addition to the marketing mix of 4 Ps – product, price, place, and promotion. The packaging is often called “advertising on the shelf”.
6. Exchange Functions
One of the highly significant functions of marketing is the exchange functions that revolve around buy and selling relations functionalities.
With the help of exchange functions, it gets to ensure that the offerings of the company are present in the market as per its requirements. Demand and supply chain management is channelized by the adept functionality of exchange functions of buying and selling.
Coca-Cola, FedEx, and Porsche are brands, and the reason behind their establishments as top-rated brands is their effective branding which is based upon their unique features, market credibility, reach and advertising.
So, branding means-
Giving a brand-name to the product to create a distinct identity vis-a-vis competitor’s products or substitutes
Branding creates meaning, association, market presence, and long-lasting credibility.
The amount of money that a customer is required to pay for purchasing the product is known as product price.
The price of a product is a crucial determinant of demand for that product. Charging too little increases sales but makes small profits. Loading too much may lose both customers and sales.
The marketing challenge is to find ways to maintain both prices and profitability in the face of competition, globalization, and availability of information to consumers. The optimal price depends on the customer’s view of the value of the product. Thus, pricing also relies on market research.
The main objective of development is to augment sales of the product. In this regard, sales promotion through incentives like discounts is an effective short-term technique. In the longer run, advertisement is imperative.
Coupons, rebates, price packs, premiums, contests, product demonstrations, and warranties are most likely going to nudge consumers into buying.
Advertisement is an art. The aim of ads is not to state facts about a product, but to sell a solution. Ads inform, persuade, remind, or reinforce a purchase decision.
For new products, advertisements need to report. For old products, they need to tell them. In conjunction, announcements and incentives can boost sales.
10. Customer Satisfaction and Service
This is again one of the very crucial functions of marketing that take the presence of a business in its target base to the next level.
Customers are the essential factors in the market which make Customer Support Service the most significant function of any marketing campaign that resolves all the issues of the customers in the most personalized manner.
Different customer support services that are the functions of marketing include After Sales Services, Technical Assistance, Managing Customer Complaints, Maintenance Services, and Credit Facilities, and so on.
Offering the customized support to customers help a business in creating a satisfied customer base that has to be the most significant factor in today’s time when cut-throat competition in hijacking competitors’ customers is quite prevalent. It also increases the repeat value of your brand, and customers would opt for purchases repeatedly from you.
11. Physical Distribution
When it comes to different functions of marketing, physical distribution does incorporate a significant role.
It deals with the strategies and practices related to the channelizing things from the place of production to the locations of consumption where the target customer bases reside.
Physical distribution-related functions of marketing revolve around different vital factors such as warehousing, inventory, order processing and transportation. Physical distribution makes sure that the key elements are organized, managed and channelized in a result-driven manner to satisfy customers and accomplish business goals.
We just discussed a brief about the transportation in 11th function of marketing. Still, it is significant enough that we have to consider this as one of the most crucial tasks of marketing here in the 12th position.
Transportation is essential because ideation, production, marketing, storage, sales, and transportation cannot occur at the same place, and they have to happen separately in a well organized, scheduled and channelized fashion.
With the help of the right use of transportation, businesses can let their marketed products and services reach to the target audience base in an efficient manner. Business uses different means and carriers for allowing their products and services to reach the audience base, which makes transportation one of the most crucial functions of marketing.
13. Storage or Warehousing
This is again one of the critical features of marketing under the subset of distribution (part of sales management). Storage or warehousing is quite essential and it needs a separate coverage as well.
When a company manufactures a product, and when it plans to market it, so the potential customers can buy it, there is for sure a time gap. And that is why the storage of goods as the right place for this time interval is quite essential. Godowns are one of the most famous examples of storage functions of marketing.
Marketing managers have to pay heed to warehouse related functions of marketing, so their stock is always ready when customers start making purchases of different products and services.
Wrapping it up!
Also, marketing performs social functions. Modern businesses thrive on the intersection of the economy and society.
Therefore, the social dimension of marketing cannot be ignored.
Companies have a responsibility towards their employees, the community and the society at large. For example, increasing responsibility towards the environment, fair working conditions to employees and a reasonable return on shareholders’ investment are some areas through which businesses can make healthy interventions in society.
What are your thoughts about the functions mentioned above of marketing? Did we miss any of the critical functions of marketing in this post? Share your views with us in the comments below.