What does the term marketing mean? Many people think of marketing only as selling and advertising. It is no wonder—every day we are bombarded with television commercials, newspaper ads, direct-mail campaigns, Internet pitches, and sales calls. However, selling and advertising are only the tip of the marketing iceberg. Although they are important, they are only two of many marketing functions and are often not the most important ones.
Today, marketing must be understood not in the old sense of making a sale—"telling and selling"—but in the new sense of satisfying customer needs. Selling occurs only after a product is produced. By contrast, marketing starts long before a company has a product. Marketing is the homework that managers undertake to assess needs, measure their extent and intensity, and determine whether a profitable opportunity exists. Marketing continues throughout the product's life, trying to find new customers and keep current customers by improving product appeal and performance, learning from product sales results, and managing repeat performance. If the marketer does a good job of understanding consumer needs, develops products that provide superior value, and prices, distributes, and promotes them effectively, these products will sell very easily. Thus, selling and advertising are only part of a larger "marketing mix"—a set of marketing tools that work together to affect the marketplace.
We define marketing as a social and managerial process whereby individuals and groups obtain what they need and want through creating and exchanging products and value with others. To explain this definition, we will examine the following important terms: needs, wants, and demands; products and services; value, satisfaction, and quality; exchange, transactions, and relationships; and markets. Figure 1.1 shows that these core marketing concepts are linked, with each concept building on the one before it.
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