Marketing

In this chapter we seek to provide some answers to the frequently posed question ‘What is marketing?’ We will argue that, essentially, marketing is concerned with exchange relationships between producers and users, suppliers and customers, and will suggest that uncertainty, confusion or misunderstanding as to the scope and nature of this exchange relationship would seem to stem from the fact that all of us have participated in such interchange and have formulated our own interpretation of its nature.

The purpose of this chapter is to establish why it is considered essential that the study and practice of marketing should be founded upon a sound theoretical base.

In the preceding chapter we were concerned primarily with defining the nature and function of theory in order to justify our view that a theoretical foundation is essential to the development of any body of knowledge. Further, we endeavoured to show that improvement in practice is dependent upon the development of such a body of knowledge which, in turn, would seem to proceed most effectively when based upon a scientific approach. In this chapter we turn our attention to an examination of the progress made towards the evolution of theory in marketing.

A republic made up of many states, each with its own culture and tongue, federated to achieve a common purpose. So might one describe consumer behaviour, with its foundation of contributions from the diverse sources of psychology, economics, sociology, statistics, anthropology and cybernetics. While this melange may offer a fertile ground for theoretical exploration, the marketing practitioner can be forgiven for querying the relevance of such an apparent miscellany of ideas and concepts to the attainment of corporate goals.

There is a general assumption; among marketing theorists, that consumer buyer behaviour has been the subject of a far greater number of research studies than has the field of organisational-industrial buyer behaviour.

The term ‘marketing communications’ was chosen deliberately and carefully as the title of this chapter, despite the unarguable fact that it is not yet widely used in marketing practice, because it defines the subject matter as precisely as possible.

Developing new products, modifying existing ones, and eliminating those that no longer make a positive contribution to the company’s marketing performance, are key activities for marketing management. In Levitt’s original terms¹ every major industry was once a growth industry, based on a new technology embodied in new product or service. Eventually major industries also became decline industries because of a failure to introduce new products or services to replace those on which their original success was based.

As we saw in the previous chapter, a natural consequence of the marketing concept, with its emphasis upon the determination of consumer wants and the deployment of resources to match these wants, is that the marketing function places particular stress upon new-product development. In this chapter we will attempt to demonstrate that the problems associated with introducing new products into the market-place appear to be remarkably similar to those experienced in gaining acceptance for innovations in other areas of activity. This being so, one might reasonably anticipate that there are considerable benefits to be gained by studying the process by which other innovations appear to secure acceptance as a basis for enhancing consumer reaction to new products.

Claims to be the oldest profession in the world have been made by a number of disciplines, and the merchant is no exception. The merchant, some would claim, was the medieval fount of the Industrial Revolution, maker of kings and princes, exploiter of commodity movements, shaper of empires and the mainspring of a colonial system that covered the world. His function is generally described as commerce, and its effect is to allow the manufacturer to communicate with distant markets. This, as Adam Smith¹ pointed out, allowed the manufacturer to benefit from the division of labour, or, in today’s terms, large-scale operations.

The concept of a ‘natural’ development in channel structure underlines many of the economic approaches to channel theory. It can be seen in the concept of the life-cycle applied to the firm’s channels (Baker),¹ or the view that channels reflect the stage of economic development of a country (Wadinambiaratchi).² Bucklin³ proposed that, in the long run, the members of the commercial channel will be driven to providing desired consumer services at the minimal cost possible, and that this will come about because of competition. This suggests that market forces in a competitive economy are the principal shapers of relationships. At the level of the firm the channels are influenced by the development of the firm or the product, as suggested by Guiltinan.⁴ This supposes that perfectly competitive markets can be found in the economy.

The hallmark of human survival throughout the ages is its biological and cultural adaptation to a changing environment. Evolution has endowed mankind with a ‘survival kit’ that enables him not only to accept a changing environment, but also to use his sense of foresight to manipulate it.

To this point we have been concerned with establishing a definition of marketing, with justifying the need for a sound theoretical foundation if the discipline is to grow, and with indicating how marketing has borrowed from other disciplines such as economics and the behavioural sciences in developing such a foundation. In this chapter we examine the extension of marketing thinking beyond the traditional areas with which it is usually associated-the sale of goods and services.

As indicated in the ‘Preface to the First Edition’, the thrust of this book has been concerned with establishing the need for a sound theoretical foundation on which to develop a discipline of marketing while recognising that the function and practice are of considerable antiquity. Based upon this argument we examined in Part II specific sub-areas within marketing to show how these had grown by borrowing concepts and ideas from other disciplines and then synthesising and developing these in a marketing context. And, in the preceding chapter, we reviewed the arguments in favour of extending the marketing concept into areas not traditionally associated with it-services and the outputs or ‘products’ of non-profit associations.