Business has only two functions - marketing and innovation.
Business has only two functions -
marketing and innovation. Marketing provides ‘leverage’ and ‘direction’
to innovation”
My Version of above
Marketing: From Inception to Conclusion
Let’s
say you have to build a house for yourself, you would start with laying base
which you may call ‘groundwork’ for the same, the second step would be to erect
the ‘structure’ of the house like walls, pillars etc. The final step would be
the ‘materialization’ wherein you buy the furniture, curtains and décor. Now
that your house is finally built next task is to ‘maintain’ which you do by
leaning it every day and repainting every couple of years.
Building
a house can be very similar to establishing and then running a company, let’s
have a closer look at the four steps of building a house and understand how
these four different phases of marketing would not only help one start a
company but also run it effectively.
Step
one, the laying
groundwork is the ‘foundation’ of a
company which is the first principle of marketing, and it can further be
divided into four sub stages:-
1)
Core Concepts – company’s approach to market
2)
Customer perceived value
3)
Market driven strategy – understanding the prevailing
environment & formulating an optimum strategy
4)
Understanding
the customer buying behavior
If I
decide to get into the business of selling shoes, primarily I need to decide
would I be producing the shoes myself or would I be a channel partner or should
I just operate a multi brand outlet. Deciding this is the very foundation of my
business and the ‘marketing processes’ like ‘research’ would allow me to make
an informed and suitable decision. Marketing is not just about selling; it is
about taking right decisions at right time.
Step
two, erecting
the structure is the ‘Formation’ of
the company which again can further be divided into three sub parts:-
1)
Segmenting – Classifying mass on basis of
demographics, age, sex, passion etc.
2)
Targeting – Selecting one or more segment as
your target group
3)
Positioning – Presenting your brand in a
appealing manner to selected target group.
Now that I have decided that I
would operate a multi brand shoes outlet, next I need to decide is who I would
be selling to, to the rich urban class or average middle class, to which age
group would I be catering because my product would depend on that.
If I want to target middle class
school children then I would sell leather shoes of Liberty or Bata, if I decide
to target the urban class youth I would keep a stock of elegant and stylish
shoes of brands like Nike or Adidas.
In order
to make this decision I must study the market, competition, society
demographics etc. This process is nothing but marketing and in order to take
the right decisions you need marketing.
Step three; the materialization would be
the ‘manifestation’ of the company, which can also be further divided into four
sub parts
1)
Product – Market & product research
that goes into product fabrication
2)
Price – deciding on price on basis of
target group, competition & margins.
3)
Placement – Retail & distribution
channel, setting up accessible markets for product
4)
Promotion - spreading the idea
Let’s
say I have finalized the target segment (rich urban youth) for my multi brand
store, my products would be sports shoes, casual sandals and party wear shoes.
The price should not only give me a profitable margin but should also be
appealing to consumer which will give me an edge over competition. Now to
spread the idea I would do some promotional activities like advertisements or
sales offers.
Needless
to say, deciding on all these parameters is again a function of marketing.
Step four - Now I have my store up and
running, so next task is the ‘maintenance’
which in business world may be referred to as dealing with competition and
maintaining your quality standards at a reasonable cost.
I would do that by measuring the
consumers’ response and continuously observing the tactics of competition and
always keeping myself updated with upcoming trends and fashion.
Marketing is not about just
limited a product, it is a cycle of multiple processes which understands the
customer perceived value and then creates, promote and deliver the same to
achieve customer satisfaction.
When you build your house the
foundation would not be visible to the visitors and structure would be covered
with materialization like curtains, doors, emulsions, hence people would only
notice the décor and furnishings.
Same happens in world of
marketing too, the foundation and structure goes unnoticed in many cases and
people only notice the manifestation and on basis of that they develop an
understanding of marketing which is only limited to manifestation like
advertising and sales offers.
For example if one is to analyze
Wal-Mart, one notices that it is successful because of low price and high
availability and we limit the marketing to only in shop offers and branding.
One must understand that the inception of the very idea of having large stock
and selling at a lower price is result of marketing. It is the foundation of the company, a market
driven strategy deduced after understanding the consumer perceived value and
buying behavior.
Same principal applies to Indigo
airlines which have the second largest market share in India (16.7%), its
approach to market is providing quality service to middle class person at a
reasonable cost.
Marketing is not just about
spreading the idea; it is a cycle which helps in inventing, maintaining and
delivering the Idea.
