Section 1.1 Marketing
7
A need is something necessary for survival,
such as food, clothing, and shelter. A need
can also be defined as something necessary to
function in society. Your needs might include
schoolbooks, transportation, and power. A want
is something that a person desires, but could live
without, such as a new cell phone or a vacation.
However, in order to understand
marketing, it is necessary to understand the
basic concepts of business. Business is the
term for all of the activities involved in devel-
oping and exchanging products and services.
Business is the engine that powers economies
around the world. Businesses perform many
activities or functions. Function is a general
word for a category of activities. The functions
of business are production, finance, marketing,
and management, as shown in Figure 1-1.
Without customers, there would be no busi-
nesses. Marketing is the function of business
that focuses on customers. Marketers help the
entire business focus on the needs and wants
of customers. The marketing function includes
learning about customers. This helps the busi-
ness to create and offer products customers want
and are able to buy. The promotion and selling of
the products also fall under marketing. Finally,
marketing provides customer service to make
sure customers are satisfied and will buy again.
AMA Tip
The American Marketing Association (AMA)
revises its definition of marketing as it deems
necessary. In 2011, the definition was: “Mar-
keting is the activity, set of institutions, and
processes for creating, communicating, deliver-
ing, and exchanging offerings that have value
for customers, clients, partners, and society at
large.”
www.marketingpower.com
Importance of Marketing
It has been said that by building a better
mousetrap, it will sell itself. That is not neces-
sarily true. If customers do not know you
have a better mousetrap, how would they
know they can buy it? Marketing tells the
product story so people will want to buy it.
Marketing Helps Businesses
Grow and Increase Profits
In today’s business world, it is often
difficult to get the attention of customers.
Marketing efforts can target the best customers,
research how to improve a product, and find
new ways to sell it. Without marketing, busi-
ness profits would decline because there would
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many businesses might close.
Marketing efforts help businesses sell
more products and increase profits. When
customers are spending more, compa-
nies are willing to invest more. They can
expand a current business or start new ones.
Marketing helps to create a positive cycle of
economic growth.
Production
Marketing
Finance
Management
Figure 1-1 The four functions of business work together
to create customer satisfaction and business success.
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