Importance of Marketing
Importance of Marketing strategy, Plan is given in the diagram below.
Image credits © Manoj Patil.
Importance of Marketing in organizational success are given below.
- Customer Satisfaction
- Competitive Advantage
- Corporate Image
- Expansion of Business
- Economies of Scale
- Organizational Objectives
- Optimum Use of Resources
- Brand Loyalty
- Brand Equity
- Brand Image
- Benefits to Stakeholders
Importance of Marketing to business firms are as follows:
1. Customer Satisfaction
Importance of marketing strategy, customer satisfaction is the main focus of the marketers in today's scenario. The product performance and customer expectation has a correlation between customer satisfaction.
- When product performance is below customer expectation, the customer is dissatisfied.
- When product performance matches with customer expectation, the customer is satisfied.
- When product performance exceeds customer expectation, the customer is delighted.
- When product performance exceeds very much more than expectation, the customer is astonished.
Examples of importance of marketing
In case of after-sale-service of consumer durable like AC, TV, etc.:
When a customer does not get service, as agreed upon, or the customer gets service only after repeated reminders to the service centre, the customer gets dissatisfied. Such customer may spoil the name of the firm.
When a customer gets additional service during the service period, which was not agreed upon by the seller, the customer is delighted.
When a customer gets additional service (free of cost) beyond the service period, the customer is astonished.
2. Competitive Advantage
Importance of the marketing plan, because of effective marketing there is healthy competition in the market. The proactive nature of the professional marketers helps in the decision-making process. They come up with:
- Inventive and creative designs or patterns.
- Artistic promotion plans.
- Efficient customer relationship systems, etc.
The pro-active decisions give a competitive advantage to the professional marketers.
3. Corporate Image
Importance of Marketing to business firms builds and intensifies its corporate image. Higher performance of the firm is achieved due to effective and efficient marketing strategies (price, right product, etc.). Hence corporate image ameliorates, which develops trust and confidents in the minds of Employees, Customers, Dealers, Suppliers, Shareholders and other stakeholders.
A good corporate image of the firm attracts many investors, which help the firm to widen and diversify it horizons. The support of various investors is required for the survival and success of the organization.
4. Expansion of Business
- Product development strategy: introduction of new products in the existing markets or modern markets.
- Market development strategy: entering in new markets with the existing products or new products.
- Market penetration strategy: increasing marketing efforts in the current markets.
5. Economies of Scale
Importance of Marketing in organizational success, professional marketers take proactive decisions. Therefore, there is an increase in demand for the firm's products. Increase in demand results in large-scale production and distribution. As a result, the company gets economies of large scale such as:
- Economies of large-scale distribution such as discount on bulk purchase of materials.
- Economies of large-scale distribution such as the freight concession due to bulk transportation.
Importance of Marketing, effective marketing brings higher profits. A part of the profits is spent on various activities such as:
- Research and development.
- Technology up gradation.
- Training and development, etc.
All the above activities improve efficiency of the firm, i.e... The firm gets higher returns at lower costs.
7. Organizational Objectives
Importance of Marketing, organizational objectives of the firm are accomplished with the help of marketing. Inventive and creative designs or patterns, Artistic promotion plans and distribution are in a proper manner then it helps the firm to achieve increment in sales. The following is the objectives:
- Increase in profits.
- Improved brand image.
- Increase in market share.
- Improved corporate image.
- Enhanced customer loyalty, etc.
8. Optimum Use of Resources
Importance of Marketing, due to effective marketing, the company gets higher demand for goods / services. Increase in demand leads to higher production and distribution. Therefore, a firm can make optimum use of resources such as:
- Physical resources: machines, equipments, tools, etc.
- Capital resources: working capital funds and fixed capital funds.
- Manpower: managerial and non-managerial employees.
9. Brand Loyalty
Importance of Marketing, brand loyalty of the product grows due to effective marketing. Brand loyalty refers to:
- Repeat purchases by satisfied / delighted customers.
- Brand loyalty of the product increases by suggestions and reviews of existing clients / customers to friends, neighbors, etc.
Marketing guru Al Ries says, “that customer word-of-mouth is the best alternative to advertising.” He calls such a customer as an evangelist (religious believer). This is because; loyal customers influence others to buy those brands, with which they are satisfied.
10. Brand Equity
Importance of Marketing, Brand equity is developed due to marketing activities. Brand equity helps to increase the value of the product. For effective marketed products, customers are willing to pay more price. For instance, unique product design, excellent after-sale-service and such other marketing activities enable a firm to command premium price for its brands.
11. Brand Image
Importance of Marketing, brand image improves marketing activities. The impression of the brand image is always remembered by the customer. Good brand image products always give an advantage to the firm in the market. For instance, powerful marketing strategies such as promotion, Publicity, Sales Promotion, Advertising, Salesmanship, etc., of the product benefits the firm to enhance its brand image in the market. Good brand image not only generates customer loyalty, but customers are also willing to pay higher price.
12. Benefits to Stakeholders
Importance of Marketing, the higher returns to the firm are brought by effective marketing. The stakeholders get many advantages from higher returns such as:
- Salaries and other incentives / perks of the employer may rise.
- Dealers may earn extra incentives due to increase in demand of the product.
- Higher tax revenue may generated by the government.
- Higher dividends may be given to the shareholder of the company.
- Distributors of this firm may generate more orders.
- Increasing profit might benifite the society.
Some important articles on Marketing are given below.