Scope of Marketing and What is Marketing?

In discussing the scope of marketing, we enter an area of controversy. Marketing is often regarded with suspicion by other departments in an organization as a threat to their independence and authority. The fact is that if marketing is to do its job properly, it is inevitable that other departments, including research and development, production, sales, finance and distribution, must abdicate some of their sovereignty in the common interests of the organization. If the purpose of the business organization is to earn a profit and that profit is dependent upon a sale, then the total resources of the organization have to be directed towards the creation and satisfaction of the consumer. It is the purpose of marketing to relate the abilities of the organization to the needs of the consumer, on the one hand, and to the profitable provision of goods’ and services, on the other.

The ability of a business to exploit a discovered consumer need is heavily dependent upon its relative strengths and weaknesses. No two people share precisely the same degree of ability, and no two commercial organizations, which are merely aggregates of people, have abilities that are identical. A company’s areas of relative weakness will result in constraints – things it cannot do – whereas its areas of relative strength will provide opportunity – things it can do well. Every firm has an accumulation of capabilities: the knowledge and experience of its management, the skills of its workforce, the capacity and performance of its plant and equipment, the financial resources and borrowing power at its command. Awareness by management of such strengths and weaknesses, and of the degree to which the company’s ability equates with the needs of the consumers whom it is intended to serve, is a basic necessity for any business.

What consumers want is the means to improve whatever it is they currently have in life. They are looking for betterment. Theoretically therefore, consumers are receptive to the purchase of anything and everything that will enhance their lives. In practice of course they are constrained by what they can afford. In the primitive state their essential needs are for sustenance and shelter. As they progress up the scale of living standards, their perception of essential needs ecomes increasingly complex. When they reach the advanced level achieved by what are called the developed nations of the modern world, they are likely to possess disposable income over and above at which is required to provide for their essential needs; this allows them to pick and choose among the vast array of luxury goods and services currently on offer. A natural desire for life improvement sustains their aspirations, whose realization is restricted only by the limit of their purchasing ability.

The complexity of the aspirations of today’s consumers has been fueled by modern technology. Every year technological advance creates yet more potential for human betterment which it is the task of commerce to convert into practical applications. To do this satisfactorily, it must understand consumers, their needs and desires.

Profitability depends on producing goods or services for sale at a price the consumer is willing to pay and at a cost that will allow sufficient margin for an acceptable return on the capital invested in the business.

No firm exists in a vacuum. The environment in which it operates will have a profound effect on all its activities: the behaviour of competitors; changes in technology; governmental policies of a political, economic, legal and financial nature; the ever-changing pattern of national and international attitudes and events. All such elements affect constantly the ability of the business organization to maintain profitability.

The bringing together of the abilities of the company and the needs of the consumer to achieve mutual benefit in what is often a hostile climate requires an attitude of mind and a method of operating different from those tolerable in former times. Marketing eschews the intuitive approach to problem-solving, insisting that management decision-making should be based on sound understanding of the commercial environment supported by factual knowledge and reasoned assumption. This is the scientific approach.


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