What is Marketing -- Part 1

Philip Kotler, the leading marketing academician of our time and author of the leading MBA marketing text, Marketing Management, has said, “Marketing is the art of creating genuine customer value.” Although Professor Kotler has appropriately described the marketer’s job as creating value, this quote -- taken by itself -- leaves one with the impression that marketing is an art form.

Marketing as an Art

Of course, Professor Kotler is correct; marketing is an art. In art, one uses personal judgment and creativity to produce a desired result. Marketing does require good personal judgment and creativity. What business activity isn’t made better with the application of good personal judgment and creativity?

Many companies, especially in business-to-business categories, act as if marketing were only an art. They staff their marketing departments with engineers and sales people who have good personal judgment and creativity. “Joe’s a bright young man who’s done well in research and development. Let’s put him in the marketing department and see how he does.”

Note, however, that these same companies don’t make the mistake of putting Fred, the marketing manager, in the research and development department. They understand that there are qualifications, such as a degree in engineering or one of the physical sciences, to succeed in research and development. Yet these same companies fail to understand that there should be qualifications for marketing positions. Willem Burgers, Philips Electronics Chair Professor of Marketing at China Europe International Business School, has written an entertaining book about this phenomenon entitled The Marketing You Never Knew.

Many marketers are frustrated by their company’s failure to recognize that there is a body of marketing knowledge that their marketing employees should have. You will find not only engineers and sales people in the marketing departments of some companies; you’ll also find lawyers and physicians. Engineers, sales people, lawyers, and physicians can be competent marketing professionals if they learn the body of knowledge. If they fail to do so, they are just “playing” marketing manager.

The Evidence of Success or Failure

Why does this double standard exist? Perhaps it’s because of the weakness of the evidence of success or failure in marketing when compared to many other functional areas. Fred, the marketing manager, is moved to research and development. It quickly becomes obvious that Fred is incapable of doing the job. His new product designs are full of flaws and impossible to manufacture. There is concrete evidence that Fred is a failure.

So how’s Joe doing after moving from research and development to marketing? It’s difficult to say. The outcome of marketing, creating value for customers by getting them to buy, is attributable to many different marketing actions. It’s difficult to say that Joe’s decisions yielded optimal results because no one knows what optimal results are. Sales volume may be up by 10%, but that may be the result of the market being up. Joe may have introduced a new package design that was predominately red and sales increased by 5%. But what would have happened if the package had been predominately green? Would sales have increased? If so, how much? By 10%? We’ll never know. It’s just not certain whether Joe is a success or a failure.

Marketing as a Science

Returning to Professor Kotler’s definition of marketing, marketing is more than an art form. Marketing is also body of knowledge, an academic discipline. That’s why colleges and universities can offer degrees in marketing, why non-academic organizations offer public marketing training courses. Going further, marketing, in addition to being an art form, is a science. Returning to Professor Kotler:

But science is also important to marketing. Marketers produce interesting findings through marketing research, market modeling, and predictive analytics. Marketers are using marketing models to make decisions and guide their investments. They are developing marketing metrics to indicate the impact of their activities on sales and profits.

Marketing not a hard physical science like chemistry or physics. Rather, it’s a soft science, a social science, a people science like psychology or sociology. As a social science, the body of knowledge that is marketing is made up of generalizations or principles or guides that hold true most of the time.

As you follow this blog, your natural instinct will be to think of the exceptions to each game rule. However, challenge yourself to absorb the guides discussed in this blog. Ask yourself, “Does this apply to my product/service category? Does it apply to my brand?” You’ll find that most, if not all, the guides apply to your marketing situation.

More from Professor Kotler

Professor Kotler recognizes that marketing is more than an art form:

I would not say that marketing is more of an art, a craft or a science but rather that it has all these elements operating.

So let’s modify Professor Kotler’s definition to “Marketing is the art, craft, and science of creating genuine customer value.” Let’s also go two steps further to make sure we all understand what we’re saying in this definition. Let’s address two questions: who’s the customer and what is value?

Who’s the “Customer”?

Many companies don’t sell directly to the businesses or individuals who buy the company’s brand, use their brand, and return to the market to buy once again. These companies employ intermediate middlemen in their channels of distribution who resell their products. These middlemen may be called wholesalers, distributors, jobbers, dealers, retailers, mass merchandisers, original equipment manufacturers, etc.

These companies’ sales forces call upon these intermediate middlemen; and for the sales force, these intermediate middlemen are customers. However, these are not the customers to whom Professor Kotler is referring. The intermediate middlemen are lower case “c” customers. The customers to whom Professor Kotler is referring are the businesses or individuals who buy the company’s brand, use their brand, and return to the market to buy once again -- the end-users. If the marketer focuses on and successfully creates value for end-users, those end-users will develop a preference for and repurchase the company’s brand. This, in turn, will give the company the leverage of their brand over the intermediate middlemen in the channel of distribution. The end-user is the upper case “C” Customer. In the1950’s the marketing rally cry was, “The customer is king!” Let’s make sure that the coronation is for these end-users who drive our business.

A word of caution: If your company is sales oriented  -- that is, dominated by sales people pursuing volume – the focus tends to be on the direct customer rather than the end-user. The focus on the direct customer is so strong and so much a part of the culture that even disciplined marketing professionals are at risk of losing their focus on the end-user.

The customers’ wants/needs as the starting point brings us to the key distinction between consumer marketing and business-to-business marketing. Consumers have different wants/needs than businesses. Because consumers’ wants/needs are different from businesses’ wants/needs, many consumer goods marketing tactics don’t work in business-to-business. Conversely, many business to business marketing tactics don’t work in consumer goods marketing.

Another cautionary note: Don’t confuse the value that you are going to deliver to your target customers with the price that they are willing to pay to get that value. Value and price paid are two separate items.

Next Discussion

In the next discussion (What is Marketing -- Part 2), I'll focus on the difference in value in consumer goods categories versus business-to-business categories. Stay tuned, and let me know what you think of the first two posts.

Some References

Philip Kotler and Kevin Lane Keller, Marketing Management, 13^th Edition (Upper Saddle River, NJ: Pearson Prentice Hall), 2008.

William Burgers, The Marketing You Never Knew (New York: Amsterdam Press), 2004.



Re: Value

“The cynic knows the price of everything and the value of nothing. “ Oscar Wilde