Marketing

Marketing Definition and History

O seguinte artigo científico, intitulado “Marketing Definition and History”, explora as origens, as principais escolas de pensamento e a evolução do marketing até aos dias de hoje.


The Wiley Blackwell Encyclopedia of Consumption and Consumer Studies
The Wiley Blackwell Encyclopedia of Consumption and Consumer Studies

Abstract

Marketing is the scientific knowledge and procedures used to persuade consumers to behave according to the objectives set by organizations and individuals. To attain these goals, organizations and individuals offer value to consumers, that is, ways of satisfying their needs and desires, in a relational process of intended reciprocal benefit. Such objectives can encompass selling products, changing attitudes and behaviors, ensuring satisfaction, and motivating adherence to causes. After World War II, marketing became a consistent managerial practice and a recognized academic subject. As well as businesses, marketing is now used by nonprofit organizations. Important marketing concepts are: marketing plan, marketing network, product, service, product life cycle, marketing environment, competition, targeting, segmentation, niche, relationship marketing, CRM, customization, personalization, co-creation, collaborative marketing, social marketing, green marketing, and online marketing.
Raquel Barbosa Ribeiro,
Isabel Soares
The Wiley Blackwell Encyclopedia of Consumption and Consumer Studies
Published Online: 24 MAR 2015
DOI: 10.1002/9781118989463.wbeccs160
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Marketing Definition and History


Marketing is the scientific knowledge and procedures used to persuade consumers to behave according to the objectives set by organizations and individuals. To attain these goals, organizations and individuals offer value to consumers, that is, ways of satisfying their needs and desires, in a relational process of intended reciprocal benefit. Such objectives can encompass selling products, changing attitudes and behaviors, ensuring satisfaction, and motivating adherence to causes.

Consumers are pivotal to the notion of marketing, a derivative of “market,” narrowly defined as demand. Amply, market is the network of players (providers, suppliers, partners, stakeholders, competitors etc.) intervening in the value exchange process between organizations or individuals and their consumers. Related terminology for consumers includes buyers, purchasers, users, clients, and customers. From the standpoint of marketing, voters, donors, members, fans, and supporters can also be consumers. Influencers and prescribers are relevant agents as far as the market is concerned.

The first notions regarding marketing can be traced to the industrial revolution, and were further developed in the United States in the first decades of the twentieth century. After World War II, a period of mass market expansion, marketing became a consistent managerial practice and a recognized academic subject. Wilkie and Moore (2003) locate the foundation of the field between 1900 and 1920 and its formalization between 1920 and 1950. The National Association of Teachers of Marketing and Advertising was formed in 1924 in the United States, followed by the American Marketing Society in 1930. Both merged into the American Marketing Association in 1937. The American Marketing Journal was first published in 1934 and the Journal of Marketing appeared in 1936. From 1945 interest grew in theorizing the field, expressed in the proliferation of books and journals dedicated to marketing.

Marketing is the scientific knowledge and procedures used to persuade consumers to behave according to the objectives set by organizations and individuals. To attain these goals, organizations and individuals offer value to consumers, that is, ways of satisfying their needs and desires, in a relational process of intended reciprocal benefit. Such objectives can encompass selling products, changing attitudes and behaviors, ensuring satisfaction, and motivating adherence to causes. Consumers are pivotal to the notion of marketing, a derivative of “market,” narrowly defined as demand. Amply, market is the network of players (providers, suppliers, partners, stakeholders, competitors etc.) intervening in the value exchange process between organizations or individuals and their consumers. Related terminology for consumers includes buyers, purchasers, users, clients, and customers. From the standpoint of marketing, voters, donors, members, fans, and supporters can also be consumers. Influencers and prescribers are relevant agents as far as the market is concerned.

The first notions regarding marketing can be traced to the industrial revolution, and were further developed in the United States in the first decades of the twentieth century. After World War II, a period of mass market expansion, marketing became a consistent managerial practice and a recognized academic subject. Wilkie and Moore (2003) locate the foundation of the field between 1900 and 1920 and its formalization between 1920 and 1950. The National Association of Teachers of Marketing and Advertising was formed in 1924 in the United States, followed by the American Marketing Society in 1930. Both merged into the American Marketing Association in 1937. The American Marketing Journal was first published in 1934 and the Journal of Marketing appeared in 1936. From 1945 interest grew in theorizing the field, expressed in the proliferation of books and journals dedicated to marketing.

Schools of marketing thought, as identified by Shaw and Jones (2005), are divided into two main periods. Before 1955, they were represented by the marketing functions school (the activities of marketing), the marketing commodities school (the classification of goods related to marketing functions), and the marketing institutions school (the actors of marketing functions). Between 1955 and 1975, academics such as Wroe Alderson helped instigate a paradigm shift from traditional to modern schools of marketing: marketing management, marketing systems, consumer behavior, macro-marketing, and exchange.

The marketing management school introduced seminal concepts in marketing. Coined in 1960, E. Jerome McCarthy’s terms marketing mix and the 4Ps (Product, Price, Placement, Promotion) identified the principal decisions marketing managers take to develop long-term strategies and short-term tactical programs. Marketing-mix variables were for a long time considered the key elements of the marketing plan, a managerial document set for three to five years and revised annually, which summarizes the resources and decisions an organization needs in order to accomplish its marketing objectives.

The product, either a good or a service, received most of the attention in the study of the marketing mix. Product life cycle, Chester R. Wasson’s conceptual instrument, assumed that products go through different stages (introduction, growth, maturity, and decline), ranging from acceptance to costs and profits, each of which entails differentiated marketing strategies. Every product is associated with a certain utility package for the consumer, that is, benefits that are the reason for its acquisition and that may go beyond its material value. “Marketing myopia,” Theodore Levitt’s expression of 1960, claimed that it would be more important for businesses to meet their customers’ needs rather than to focus on selling products, thus revealing the concept of customer orientation which became a cornerstone of marketing. As Charles Revson, Revlon’s founder, stated, “in the factory we make cosmetics, and in the drugstore we sell hope.”

Still within the marketing management school, marketers worked on new ways to distinguish their products from others on consumers’ minds, upon realizing that competition was fierce. Strategies such as positioning, intended to simplify consumption choices, were therefore developed. Positioning is the set of main and distinctive traits that define the image of an organization, product, or brand. It is determined by consumers’ expectations, the organization’s offer, and competitors’ attributes. The result should be a positioning statement with key messages and customer value propositions to be used for communication with the target audience.

Moving beyond the improvement of the marketing offer, the school of marketing management explored the potentials of unattended demand. Consumers’ differences were considered in order to develop cost-effective strategies and attain better results as far as the organization–consumer relationship is concerned. Generated by this perspective, market segmentation is the process through which organizations identify and separately deal with distinct types of consumers (segments) and their different needs and profiles. Usual criteria for segmenting markets are demographics, socioeconomic and psychological variables, and shopping behavior patterns. Differentiated offers, positioning, and strategies are developed in line with the particulars of each segment, in what is known as targeting. Within market segmentation, niches are smaller, albeit substantial, segments with a restricted number of consumers with very specific needs, who tend to be considered highly profitable or influential.

A later development of the school of marketing management, Philip Kotler’s “analysis, planning and control,” entered marketing in 1967. Overall, based on their knowledge of the market (gained from organizational diagnosis, market analysis, competitor evaluation, and consumer research), marketing managers define the offer to the market (in the form of products, services, or others), make decisions about such offers (including product specifications, packaging, branding, pricing, distribution and logistics, communication, and customer service), negotiate the best terms with the business partners (suppliers, distributors, financial institutions, etc.), elaborate a budget, schedule and implement decisions (sales, promotion, logistics), assess results, and correct mistakes.

After marketing management, Alderson’s subsequent contribution was the school of marketing systems, which dealt with the interaction between micro- and macro-marketing. It recognized the importance of articulating marketing activities with the organization’s broad environment. This environment entails demographic, economic, natural, technological, political-legal, and social-cultural variables that may affect the marketing network. A marketing network consists of the organization and its supporting stakeholders (customers, employees, suppliers, distributors, and partners) with whom it builds mutually beneficial relationships.

While marketing management matured and systems declined, the school of consumer behavior concerned itself with the economic, psychological, and sociological scientific knowledge required for understanding needs, desires, and satisfaction. Behavioral contributions grew in the marketing field in the 1960s, coexisting alongside developments in mathematics and statistically based models applied to marketing research. Together, qualitative and quantitative techniques provided marketers with instruments that enabled them to perform complex and comprehensive analysis and thus forecast consumers’ beliefs, preferences, and actions.

The school of macromarketing rekindled the contributions of the school of marketing systems by highlighting the reciprocal impact of marketing in society and vice versa. Movements, policies, and macroeconomic development were taken into account. The school of exchange, on the other hand, encompassed both commercial transactions and generic human interactions, such as motivations and values between parties in a complex social context. These schools paved the way for the expansion of the marketing field proposed by Kotler after 1975.

From 1975 to 2000, marketing scholars, namely Kotler and his coauthors, further expanded the limits of marketing from business to all forms of human activity, not only economic but also social, political, religious, and personal. Marketing’s widened scope began to include experiences, events, personalities, places, properties, information, and ideas as well. Concurrently, variables such as political power, public opinion, participants, physical evidence, process, and personalization were added to the marketing-mix concept. This progressive “marketization of everything” has, however, been, both academically and ethically controversial.

Major topics stemming from this paradigm change include nonprofit organizations, societal impact, and stakeholders. Social marketing, a branch of marketing that gained relevance in this period, considers the use of marketing strategies to influence a public to voluntarily accept, change, or abandon behaviors for the sake of individuals and society. Marketing is presently considered relevant to companies in all business areas, nonprofit organizations, governments and public services, nongovernmental organizations, political parties, and individuals.

Kotler and Keller (2012) describe three stages in the evolution of marketing, from product centered (Marketing 1.0), to consumer based (Marketing 2.0), to value oriented (Marketing 3.0). In the contemporary stage, Marketing 3.0, organizations propose functional, emotional, and spiritual value to consumers through the use of collaborative strategies and technological innovations destined to meet the goal of making the world a better place.

Originally designed as an instrument for developing offers to consumers and persuading them to buy, marketing evolved to the value creation paradigm, a management attitude that assumes a consumer-centric and relational perspective based on value, used either for profit or for nonprofit purposes. Marketing is now conceptually more devoted to the interests of consumers and to the interests of stakeholders, which are increasingly ruling organizations’ decisions, than to profit making only. In this line of action, corporate social responsibility (CSR) refers to the organizational commitment to improve the well-being of the community. For instance, increasing environmental concerns and consumers’ growing awareness of these issues leads organizations to develop and communicate environmentally friendly practices.

In more recent decades, services have gained importance in the economy of most countries, posing new challenges to marketers as the world becomes increasingly globalized and consumers acquire more power. Contemporary sub-areas of marketing thought include services marketing, CRM (customer relationship management), and customized or personalized marketing. Services suppose different types of relations between clients and organizations. In services like transportation or tourism, consumer and provider are present and relate in the same physical place. In other cases, the service is provided remotely (online sales, home banking), or through machinery and equipment (ATM). Conceived for dealing effectively with various forms of interaction, relationship marketing, developed during the 1990s, aims at building long-term, valuable relations with consumers, partners, and stakeholders, for reciprocal preference and benefit.

A derivation of relationship marketing, CRM is a strategy for gathering, processing, and managing relevant information about consumers (or customers) and their relation with the organization in the light of maximizing their loyalty. CRM, technologically supported by database analysis and data mining tools, can help organizations identify and address their best customers, develop targeted marketing activities and campaigns, improve customer management, optimize information, and reduce costs. CRM also provides the basis for effective customization and personalization. In contrast to mass-marketing strategies, which address consumers in an undifferentiated way, customization and personalization seek to please consumers with offers adapted to their particular needs and desires. Expensive, “pure” customization is practiced by relatively few organizations (e.g., in the area of luxury goods and services or in business-to-business [B2B] marketing), but mass customization, a process allowing consumers to partly choose or co-create the attributes of their products from a set of predefined options, is expanding. The participation of consumers, not only in production but along all stages of the marketing strategy (known as collaborative marketing), has rocketed over the last years, especially due to online marketing possibilities.

More than a marketing tool, online marketing is an expanding sub-area of marketing itself. A mere distribution channel for electronic commerce in the early days of the internet, it now encloses any marketing activity, from research to advertising and CRM. Therefore, virtual communities, social media, viral marketing, and search engine optimization (SEO) are forecast to be prominent topics in the future of marketing.

See also: B2B Marketing

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