Benefits Of Marketing Functions To Firms And Society
Benefits of Marketing Functions to Firms and Society
The history of marketing in the United States shows how marketing functions evolved in response to needs created by the economic development of society. Today, marketing activities are so pervasive in America that people rarely stop to appreciate the benefits of marketing to society or take time to consider the problems that consumers would face if marketing did not exist. On the contrary, excessive pressure from telemarketers, direct mail campaigns, and frequent media advertising understandably create irritation in society to the extent that demand for products and services designed to avoid intrusions has grown (answering machines, Caller ID, commercial zapping technologies, etc.).
Clearly, firms benefit when buyers listen to their promotional communications, when their products are well distributed, and when their product benefits and costs are balanced against optimal pricing strategies. Marketing research obviously helps companies to design and target their products and services efficiently. Successful firms provide jobs and taxes that support the economy, and they often provide products or services to the community as good corporate citizens. These benefits of marketing are easy to see.
It is harder to appreciate the benefits that marketing provides directly to society. To understand these benefits, consider the alternatives. Marketers create products and services using research results and a general understanding of what society needs and wants. Without the product development function, there would be a mismatch between supply and demand, such as is found in parts of Eastern Europe today. There, old manufacturers continue to produce old-fashioned, enamel-coated pots and pans rather than modern Teflon and stainless steel designs. They believe that because consumers buy enamel, they want enamel, when it is actually more likely is that consumers want Teflon and stainless, but without those products in their stores, they are forced to buy only enamel.
In a market economy, prices change freely based on the balance between the supply of products or services compared to the corresponding demand. Marketers study prices of competitive products and substitute products to create competitive prices that also cover all business expenses and yield some profit for investors. Therefore, the prices that buyers find in stores tend to be relatively stable and fair. If this were not the case, people might waste too much time shopping to learn about radical variations in pricing.
The distribution function makes it possible to buy products from all over the world in one store. Imagine how difficult and expensive it would be if one could only buy a product directly from the factory. Of course, one could pay to have each item shipped directly to your home, but think of how much one would spend for delivery fees each month. Centralized distribution systems dramatically reduce the cost of acquiring a broad variety of products manufactured around the globe.
Imagine that you needed to buy a car, but advertising and branding did not exist. How would you obtain the information you needed to select a car with the features you wanted? You would probably waste a lot of time finding places that sell cars and investigating each car. Promotional activities such as advertising, promotional events, and personal selling provide information, reminders, and persuasive reasons to buy. In short, marketing communications compare benefits with competitive offerings. While some argue that promotional and branding activities merely add to the cost of products and services, advertising and point-of-sale materials provide standardized answers to most questions at a much lower cost to both suppliers and buyers. They help you to know where you can find what you need, as branding creates standards that can be expected from specific brand names. Trained salespeople have studied product benefits and disadvantages, so they can answer questions quickly, thus saving shoppers time for researching features.
Marketing functions create value (utility) for both firms and society. It is the responsibility of firms to perform marketing activities considerately and ethically. It is the responsibility of consumers to avoid rewarding marketers that engage in undesirable forms of marketing. However, in general, marketing functions provide more benefits than harm to society by yielding products and services with desired benefits at relatively fair and consistent prices in places convenient for buyers. The costs associated with these activities are reduced through centralized marketing functions.