What Is Marketing?

Marketing refers to activities a company undertakes to promote the buying or

selling of a product or service. Marketing includes advertising, selling, and
delivering products to consumers or other businesses. Some marketing is done by
affiliates on behalf of a company.

Professionals who work in a corporation's marketing and promotion departments seek

to get the attention of key potential audiences through advertising. Promotions are
targeted to certain audiences and may involve celebrity endorsements, catchy
phrases or slogans, memorable packaging or graphic designs, and overall media
exposure.

KEY TAKEAWAYS
Marketing refers to all activities a company does to promote and sell products or
services to consumers.
Marketing makes use of the "marketing mix," also known as the four Ps—product,
price, place, and promotion.
Marketing used to be centered around traditional marketing techniques including
television, radio, mail, and word-of-mouth strategies.
Though traditional marketing is still prevalent, digital marketing now allows
companies to engage in newsletter, social media, affiliate, and content marketing
strategies.
At its core, marketing seeks to take a product or service, identify its ideal
customers, and draw the customers' attention to the product or service available.
What Is the Goal of Marketing?
Marketing as a discipline involves all the actions a company undertakes to draw in
customers and maintain relationships with them. Networking with potential or past
clients is part of the work too and may include writing thank you emails, playing
golf with prospective clients, returning calls and emails quickly, and meeting with
clients for coffee or a meal.

At its most basic level, marketing seeks to match a company's products and services
to customers who want access to those products. Matching products to customers
ultimately ensures profitability.

Formal Definition:
"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. "
—Official definition from the American Marketing Association, approved 2017.
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What Are the 4 P's of Marketing?

Product, price, place, and promotion are the Four Ps of marketing. The Four Ps
collectively make up the essential mix a company needs to market a product or
service. Neil Borden popularized the idea of the marketing mix and the concept of
the Four Ps in the 1950s.

Image
Image by Sabrina Jiang © Investopedia 2020
Product
Product refers to an item or items the business plans to offer to customers. The
product should seek to fulfill an absence in the market, or fulfill consumer demand
for a greater amount of a product already available. Before they can prepare an
appropriate campaign, marketers need to understand what product is being sold, how
it stands out from its competitors, whether the product can also be paired with a
secondary product or product line, and whether there are substitute products in the
market.
Price
Price refers to how much the company will sell the product for. When establishing a
price, companies must consider the unit cost price, marketing costs, and
distribution expenses. Companies must also consider the price of competing products
in the marketplace and whether their proposed price point is sufficient to
represent a reasonable alternative for consumers.

Place
Place refers to the distribution of the product. Key considerations include whether
the company will sell the product through a physical storefront, online, or through
both distribution channels. When it's sold in a storefront, what kind of physical
product placement does it get? When it's sold online, what kind of digital product
placement does it get?

Promotion
Promotion, the fourth P, is the integrated marketing communications campaign.
Promotion includes a variety of activities such as advertising, selling, sales
promotions, public relations, direct marketing, sponsorship, and guerrilla
marketing.

Promotions vary depending on what stage of the product life cycle the product is
in. Marketers understand that consumers associate a product’s price and
distribution with its quality, and they take this into account when devising the
overall marketing strategy.

Marketing refers to any activities undertaken by a company to promote the buying

or selling of a service. If there is a limited quantity of a product, a company may
market itself in an attempt to be better positioned as one of the few who get to
buy something.
Types of Marketing Strategies
Marketing is comprised of an incredibly broad and diverse set of strategies. The
industry continues to evolve, and the strategies below may be better suited for
some companies over others.

Traditional Marketing Strategies

Before technology and the internet, traditional marketing was the primary way
companies would market their goods to customers. The main types of traditional
marketing strategies includes:

Outdoor Marketing: This entails public displays of advertising external to a

consumer's house. This includes billboards, printed advertisements on benches,
sticker wraps on vehicles, or advertisements on public transit.
Print Marketing: This entails small, easily printed content that is easy to
replicate. Traditionally, companies often mass produced printed materials, as the
printed content was the same for all customers. Today, more flexibility in printing
processes means that materials can be differentiated.
Direct Marketing: This entails specific content delivered to potential customers.
Some print marketing content could be mailed. Otherwise, direct marketing mediums
could include coupons, vouchers for free goods, or pamphlets.
Electronic Marketing: This entails use of TV and radio for advertising. Though
short bursts of digital content, a company can convey information to a customer
through visual or auditory media that may grab a viewer's attention better than a
printed form above.
Event Marketing: This entails attempting to gather potential customers at a
specific location for the opportunity to speak with them about products or
demonstrate products. This includes conferences, trade shows, seminars, roadshows,
or private events.
Digital Marketing
The marketing industry has been forever changed with the introduction of digital
marketing. From the early days of pop-up ads to targeted placements based on
viewing history, there are now innovating ways companies can reach customers
through digital marketing.

Search Engine Marketing: This entails companies attempting to increase search

traffic through two ways. First, companies can pay search engines for placement on
result pages. Second, companies can emphasize search engine optimization (SEO)
techniques to organically place highly on search results.
E-mail Marketing: This entails companies obtaining customer or potential customer
e-mail addresses and distributing messages or newsletters. These messages can
include coupons, discount opportunities, or advance notice of upcoming sales.
Social Media Marketing: This entails building an online presence on specific social
media platforms. Like search engine marketing, companies can place paid
advertisements to bypass algorithms and obtain a higher chance of being seen by
viewers. Otherwise, a company can attempt to organically grow by posting content,
interacting with followers, or uploading media like photos and videos.
Affiliate Marketing: This entails using third-party advertising to drive customer
interest. Often, an affiliate that will get a commission from a sale will do
affiliate marketing as the third-party is incentivized to drive a sale for a good
that is not their own original product.
Content Marketing: This entails creating content, whether eBooks, infographics,
video seminars, or other downloadable content. The goal is to create a product
(often free) to share information about a product, obtain customer information, and
encourage customers to continue with the company beyond the content.
In 1978, Gary Thuerk sent a message to roughly 400 people using ARPANET, the first
public packet-switched computer network. With that message, the first ever recorded
spam e-mail message had been sent.
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What Are the Benefits of Marketing?

Well-defined marketing strategies can benefit a company in several ways. It may be
challenging in developing the right strategy or executing the plan; when done well,
marketing can yield the following results:

Audience Generation. Marketing allows a company to target specific people it

believes will benefit from its product or service. Sometimes, people know they have
the need. Other times, they don't realize it. Marketing enables a company to
connect with a cohort of people that fit the demographic of who the company aims to
serve.
Inward Education. Marketing is useful for collecting information to be processed
internally to drive success. For example, consider market research that finds a
certain product is primarily purchased by women aged 18-34 years old. By collecting
this information, a company can better understand how to cater to this demographic,
drive sales, and be more efficient with resources.
Outward Education. Marketing can also be used to communicate with the world what
your company does, what products you sell, and how your company can enrich the
lives of others. Campaigns can be educational, informing those outside of your
company why they need your product. In addition, marketing campaigns let a company
introduce itself, its history, its owners, and its motivation for being the company
it is.
Brand Creation. Marketing allows for a company to take an offensive approach to
creating a brand. Instead of a customer shaping their opinion of a company based on
their interactions, a company can preemptively engage a customer with specific
content or media to drive certain emotions or reactions. This allows a company to
shape its image before the customer has ever interacted with its products.
Long-lasting. Marketing campaigns done right can have a long-lasting impact on
customers. Consider Poppin' Fresh, also known as the Pillsbury Doughboy. First
appearing in 1965, the mascot has helped create a long-lasting, warm, friendly
brand for Pillsbury.
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Financial Performance. The ultimate goal and benefit of marketing is to drive
sales. When relationships with customers are stronger, well-defined, and positive,
customers are more likely to engage in sales. When marketing is done right,
customers turn to your company, and you gain a competitive advantage over your
competitors. Even if both products are exactly the same, marketing can create that
competitive advantage for why a client picks you over someone else.
According to MarTech, a digital marketing provider, the world will spend $4.7
trillion on marketing by 2025. This estimate includes an increase of $1.1 trillion
from 2021 to 2025.
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What Are the Limitations of Marketing?

Though there are many reasons a company embarks on marketing campaigns, there are
several limitations to the industry.

Oversaturation. Every company wants customers to buy its product and not its
competitors. Therefore, marketing channels can be competitive as companies strive
to garner more positive attention and recognition. If too many companies are
competing, a customer's attention may be strongly diluted, resulting in any form of
advertising not being effective.
Devaluation. When a company promotes a price discount or sale, the public may
psychologically eventually see that product as worth less in the future. If a
campaign is so strong, customers may even wait to purchase a good knowing or
remembering what the sale price was from before. For example, some may
intentionally hold off buying goods if Black Friday is approaching.
No Guaranteed Success. Marketing campaigns may incur upfront expenses that hold no
promise of future success. This is also true of market research studies, where
time, effort, and resources are poured into a study that may yield no usable or
helpful results.
Customer Bias. Loyal, long-time customers need no enticing to buy a company's brand
or product. However, newer, uninitiated customers may. Marketing naturally is
biased towards non-loyal patrons as those who already support the company would be
better served by further investment in product improvement.
Cost. Marketing campaigns may be expensive. Digital marketing campaigns may be
labor-intensive to set up and costly to maintain the scheduling, implementation,
and execution of the plan. Don't forget about the headlines that promote Super Bowl
commercial expenses in the millions.
Economy-Dependent. Marketing is most successful when people have capital to spend.
Though marketing can create non-financial benefits such as brand loyalty and
product recognition, the ultimate goal is to drive sales. During unfavorable
macroeconomic conditions when unemployment is high or recession concerns are
elevated, consumers may be less like to spend no matter how great a market campaign
may be.