Functions of Marketing
Functions Of Marketing
Marketing involves a series of activities that need to be performed to facilitate the exchange of goods and services from producers to consumers. These activities are often referred to as the Functions of Marketing.
These functions are performed by marketers to ensure that the right product, with the right features, is available at the right place, at the right price, and reaches the target customers with effective communication.
While the number and classification of functions may vary slightly depending on the source, some of the commonly accepted important functions are:
1. Gathering and Analysing Market Information
2. Marketing Planning
3. Product Designing and Development
4. Standardisation and Grading
5. Packaging and Labelling
6. Branding
7. Customer Support Services
8. Pricing of Product
9. Promotion
10. Physical Distribution
11. Transportation
12. Storage or Warehousing
Gathering And Analysing Market Information
This is the foundational function of marketing. It involves collecting relevant information about the market, such as consumer needs and wants, competitor strategies, market trends, demand patterns, and so on.
This information is then analysed to identify opportunities and threats, understand customer behaviour, and make informed decisions about product development, pricing, promotion, and distribution.
This function is also known as Market Research.
Marketing Planning
Based on the market information gathered, the marketing manager develops a marketing plan. This involves setting marketing objectives (e.g., increasing market share, launching a new product), formulating marketing strategies (e.g., target market selection, positioning), and outlining the steps and resources needed to achieve these objectives.
Marketing planning provides the roadmap for all marketing efforts.
Product Designing And Development
This function involves designing the product in a way that it appeals to the target customers and developing it based on the identified needs and preferences. Good design is not just about aesthetics; it also relates to the functionality, quality, and features of the product.
Product development involves bringing a new product idea to market or improving an existing one. It requires collaboration between marketing, R&D, and production teams.
Example 1. A furniture company in Rajasthan conducts surveys to find out what kind of sofas are preferred by young couples in metros. Based on the findings, they create new designs that are space-saving, modular, and available in vibrant colours. Which marketing functions are they performing?
Answer:
They are performing Gathering and Analysing Market Information (conducting surveys) and Product Designing and Development (creating new designs based on findings).
Standardisation And Grading
Standardisation is the process of producing goods of pre-determined specifications or characteristics to ensure uniformity and consistency in quality, size, design, weight, etc.
Grading is the process of classifying products into different groups based on some of their important characteristics such as quality, size, etc. It is usually done for agricultural products (like fruits, vegetables, grains) and raw materials.
These functions ensure that products meet certain quality benchmarks and help in fixing prices and facilitating sales.
Packaging And Labelling
Packaging involves designing and producing the container or wrapper for a product. It serves multiple purposes:
1. Protection: Protects the product from damage, spoilage, or pilferage during storage, transportation, and sale.
2. Identification: Helps in easy identification of the product.
3. Convenience: Makes handling, transportation, and consumption convenient for customers and intermediaries.
4. Promotion: Attractive packaging can attract customer attention and act as a promotional tool.
Labelling is putting an identification mark on the package. The label provides information about the product, such as contents, manufacturer, date of manufacturing, expiry date, price, instructions for use, etc. It provides statutory warnings if required.
Example 2. A company selling packaged snacks redesigns its packaging to be more colourful and include a small QR code that links to a recipe video using the snack. The label clearly lists ingredients, nutritional information, and manufacturing details. Which marketing functions are being highlighted here?
Answer:
This highlights the functions of Packaging (making it colourful and including a QR code for promotion and convenience) and Labelling (providing information like ingredients and manufacturing details).
Branding
Branding is the process of giving a name, term, sign, symbol, or design, or a combination of these, to a product or service to identify it and differentiate it from those of competitors. The name, term, sign, symbol, etc., is called a Brand.
A brand helps customers recognise and remember the product. It builds trust and loyalty. A good brand name is easy to pronounce, memorable, suggestive of product benefits, and distinctive.
Example: 'Tata', 'Reliance Jio', 'Amul', 'Maggi' are brands.
Advantages of Branding:
To Marketers: Helps in product differentiation, enables charging premium prices, facilitates advertising and sales promotion, creates loyalty.
To Customers: Helps in product identification, ensures quality, provides status symbol.
Customer Support Services
This function involves providing services to customers before, during, and after the sale to ensure customer satisfaction and build loyalty. These services can include after-sales service, handling customer complaints, maintenance services, credit facilities, technical assistance, and consumer information.
Good customer support services build a strong relationship with the customer and contribute to repeat sales and positive word-of-mouth.
Pricing Of Product
Pricing is the process of determining the value (in monetary terms) at which a product or service will be sold. The price is a critical factor influencing sales and profitability.
It requires careful consideration of various factors like cost of production, demand for the product, competition, government regulations, and the company's pricing objectives (e.g., profit maximisation, market penetration, market skimming).
$$ \text{Price} \approx \text{Cost} + \text{Profit Margin} $$ (A simplified view; actual pricing is more complex)
An appropriate pricing strategy is essential for the success of a product.
Promotion
Promotion involves activities aimed at informing, persuading, and reminding customers about the product or service and the company. It is used to stimulate demand.
Key elements of the promotion mix are:
1. Advertising: Impersonal form of communication through paid media (e.g., TV ads, newspaper ads, online banners).
2. Personal Selling: Direct face-to-face communication between a salesperson and a potential customer.
3. Sales Promotion: Short-term incentives to encourage immediate purchase (e.g., discounts, coupons, free samples, contests).
4. Public Relations: Building a favourable public image and handling unfavourable rumours or events (e.g., press releases, sponsorships, events).
5. Digital Marketing: Using digital channels like social media, search engines, email, and websites for promotion.
Example 3. A mobile company launches a new smartphone. They run full-page advertisements in leading newspapers, offer a ₹2,000 discount for the first week, send emails to potential customers, and train their store staff to explain the phone's features to visitors. Which marketing functions and promotion mix elements are used here?
Answer:
The main function highlighted is Promotion. The promotion mix elements used are:
- Advertising: Full-page advertisements in newspapers.
- Sales Promotion: Offering a ₹2,000 discount.
- Digital Marketing: Sending emails to potential customers.
- Personal Selling: Training store staff to explain features to visitors.
Physical Distribution
Physical Distribution involves all the activities required to move goods from the place of production to the place of consumption. It ensures that the product is available to customers at the right time, in the right quantity, and at the right place.
Key components of physical distribution include:
1. Channel of Distribution (Intermediaries)
2. Transportation
3. Warehousing (Storage)
4. Inventory Management
5. Order Processing
Transportation
Transportation is the physical movement of goods from the point of production to the point of consumption. The choice of transport mode (road, rail, air, water, pipeline) depends on factors like the nature of the product, distance, cost, speed, and accessibility.
Efficient transportation is crucial for making products available to customers across different locations.
Storage Or Warehousing
Storage or Warehousing is the activity of holding goods in a protected place from the time they are produced until they are needed for consumption. Production and consumption rarely occur simultaneously.
Warehousing helps in balancing demand and supply, ensuring availability of goods when customers need them, protecting goods from damage or theft, and enabling bulk breaking and sorting.
It creates 'time utility' by making goods available at the time they are demanded.
Example 4. A company manufacturing bicycles in Punjab sends them by railway wagons to distributors in different states like Uttar Pradesh, Bihar, and West Bengal. The distributors then store the bicycles in large warehouses before sending smaller batches to retailers in various cities. Which marketing functions are described here?
Answer:
This describes parts of the Physical Distribution function, specifically Transportation (sending bicycles by railway wagons) and Storage or Warehousing (distributors storing bicycles in warehouses).