THE DEFINITION OF MARKETING
The basic concept of marketing is based on the concept of an exchange of equal market values for the purpose of satisfying human needs or wants. This definition raises several additional questions.
What is an exchange?
A marketing exchange occurs when an individual gives something of value for a sought-after product or service. The vehicle most often used for an exchange transaction is money. Barter is another form of exchange which does not require the use of money. Rather, in a barter system, there is an exchange of property or services. An example is marketing consulting services given in exchange for the purchase of a computer system.
What is market value?
Market value is established by actual or potential buyers and sellers. A marketplace can either be centralized, such as a stock market, or decentralized, as in a national marketplace. In the decentralized marketplace, advertising and mass communication inform the buyers and sellers as to market values.
What is a need?
A need is an unfulfilled desire that an individual has which acts as a strong motivator. The individual seeks to fulfill a need. Needs include physical, social and psychological desires. Marketing can create individual needs.
What is a want?
A want is the process of satisfying an unfulfilled need. Wants are culturally based in the sense that when an individual has a need for shoes, he/she will think of a particular brand name to satisfy the need. Individuals who have a need for a chocolate bar state they want a “Hershey Bar” when any brand chocolate bar will suffice. Wants and needs are often confused. Some computer manufacturers emphasize the speed and power of a computer, when many consumers only need a simple word processor to type a letter. Thus, computer manufacturers who bundle word processing software with the computer can emphasize its simplicity and usefulness for word processing, rather than its technological features, and gain market share.
What is the role of products and services in marketing?
Marketable products and services are used to satisfy the wants and needs of consumers in the marketplace. An individual having a need to appear successful may want to purchase expensive clothing or a luxury car to satisfy the need.