The Definition of Marketing
Peter Drucker, a renowned business theorist, loved a certain quotation from Czech writer Milan Kundera: “Business has only two functions – marketing and innovation.”
Innovation means creating something new, either a new product or service. Sometimes, that “new” product or service simply improves a product or service that already exists (example: a new courier service that provides different or better services than the competition). As a company, Apple has succeeded not by creating completely new ideas that never existed before, but in taking old ideas and innovating ways to make them cooler, more accessible, and more attractive than the competition. Portable music players existed long before the iPod came out, but Apple designed a product that was so much better, cooler, and sexier than anything before it that it changed the world. That’s innovation.
But what is marketing? Many people think that marketing is simply creating advertisements and running promotions. Let’s take a look at how the American Marketing Association defines marketing:
“Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.”
That doesn’t help much, does it? Let’s see if we can translate this definition a bit. Let’s use something else Peter Drucker said to give us some hints:
“The aim of marketing is to make selling superfluous. The aim of marketing is to know and understand the customer so well that the product or service fits him and sells itself. Ideally, marketing should result in a customer who is ready to buy.”
That makes a lot more sense than the first definition. So does that mean that marketing is actually a process of understanding who your customers are and shaping your product or service to exactly match what they want? Yes, that’s a big part of it. But wait, doesn’t that mean that marketing isn’t so much about putting up advertisements as it is about gaining insight into the people who you were trying to reach with those advertisements? We’re getting somewhere now.
Marketing is an ongoing process. That process begins with learning more about your market and understanding the needs of your customers, continues with the innovation of ideas that will create value for your customers and communicating them, and concludes with the implementation of those ideas into action and solving those problems for your clients. Then the process starts over.
So, to bring it home, how can we use this understanding when we are thinking about starting a courier service? Well, grab a pencil and let’s jot down the answers to some questions:
1) Who is your target market?
2) Why are they your target market?
3) How can you find out what are their biggest problems on a day-to-day basis?
4) How can your services address their biggest problems?
5) What is your plan for communicating #4 to your potential clients?
By answering these questions, you have taken the first steps in formulating a marketing plan. And that’s where we’ll pick up next time.