Managers face an endless challenge to create unique strategies that will enable them provide positional advantage in an effort to achieve superior financial or customer performance. A company’s pecuniary success largely depends upon prudent marketing efforts along with financial, operational, accounting and other business functions. Marketing is identified as focusing on strategies concerning the critical decision of market definition and market segmentation as well as the identification of potential bases for differentiation.
Sometimes, people ask why marketing is important in the financial success of a company. The answer to this question is, assume you have a product to offer with excellent features, best quality and amazing packaging but no one knows about your product? There will be no demand in the market for your it, the company will make no sale and eventually no profit. Here comes the importance of marketing. The most important function of marketing, along with others, is to create awareness about products/services and make loyal customers. Through marketing customers get an opportunity to know what you are offering them and you get the opportunity to convince them to buy your products/services.
The overall marketing umbrella covers advertising, public relations, promotions and sales. Marketing is a process by which a product or service is introduced and promoted to potential customers. Without marketing, your business may offer the best products or services in your industry, but none of your potential customers would know about it. Without marketing, sales may crash and companies may have to close. Production and distribution depend largely on marketing. Many people think that sales and marketing are basically the same. These two concepts are different in many aspects. Marketing covers advertising, promotions, public relations, and sales. It is the process of introducing and promoting the product or service into the market and encourages sales from the buying public. Sales refer to the act of buying or the actual transaction of customers purchasing the product or service.
Some important reasons why marketing is important include:
- Getting the Word Out – For a business to succeed, the product or service it provides must be known to potential buyers. Unless your business is known in the community and communication with your customers is readily available, you have to use marketing strategies to create product or service awareness. Without marketing, your potential customers may never be aware of your business offerings and your business may not be given the opportunity to progress and succeed. Using marketing to promote your product, service and company provides your business with a chance of being discovered by prospective customers.
- Higher Sales – Once your product, service or company gets on the radar screen of your prospects, it increases your chances that consumers will make a purchase. As awareness becomes a reality, it is also the point where new customers start to spread the word, telling friends and family about this amazing new product they discovered. Your sales will steadily increase as the word spreads. Without employing marketing strategies, these sales may not have ever happened; without sales, a company cannot succeed.
- Company Reputation – The success of a company often rests on a solid reputation. Marketing builds brand name recognition or product recall with a company. When a company reaches the high expectations of the public, its reputation stands on firmer ground. As your reputation grows, the business expands and sales increase. The reputation of your company is built through active participation in community programs, effective communication (externally and internally) and quality products or services, which are created or supported by marketing efforts.
- Healthy Competition – Marketing also fosters an environment in the marketplace for healthy competition. Marketing efforts increases awareness and gets the word out on pricing of products and services, which not only reaches the intended consumers, but also reaches other companies competing for the consumers’ business. As opposed to companies that have a monopoly on products and services that can charge almost any price, marketing helps keep pricing competitive for a business to try to win over consumers before its competition does. Without competition, well known companies would continue to sell while lesser known companies or new companies would stand little chance of ever becoming successful. Marketing facilitates the healthy competition that allows small businesses and new businesses to be successful, enter and grow in the marketplace. As there is high competition in the market and you are not the only one to offer that product, certain issues need to be considered, issues like; how is this product different from that of competitors? What do I have better to offer than my competitor? And why should a customer buy my product rather than my competitors’? All this is achieved through intelligent marketing campaign and is self-evident of the significance of marketing. It enables an organization to capture maximum market share, make a big brand name, make loyal customers and retain them.
Marketing Promotes Product Awareness to the Public
It has already been mentioned in the previous paragraph that getting the product or service recognized by the market is the primary goal of marketing. No business possibly ever thought of just letting the people find out about the business themselves, unless you have already established a reputation in the industry. But if you are a start-out or an average company, the only means to be made known is to advertise and promote. Your business may be spending quite a lot on advertising and promotional programs but the important thing at the end of the day is that product and company information is disseminated to the buying public, they get interested and purchase it and as a result increasing sales and revenue for the company.
Various types of marketing approaches can be utilized by an organization. All forms of marketing promotes product awareness to the market at large. Offline and online marketing make it possible for the people to be educated with the various products and services that they can take advantage of.
A company must invest in marketing so as not to miss the opportunity of being discovered by potential consumers. If expense is to be considered, there are cost-effective marketing techniques a company can embark on such as pay-per-click ads and blogging.
Marketing Helps Boost Product Sales
Apart from public awareness about a company’s products and services, marketing helps boost sales and revenue growth. Whatever your business is selling, it will generate sales once the public learns about your product through TV advertisements, radio commercials, newspaper ads, online ads, and other forms of marketing. The more people hear and see more of your product, the more likely it would be for them to want to try it. It’s this basic principle that makes firms spend millions on marketing activities.
If your company aims to increase the sales percentage and double the production, the marketing department must be able to come up with effective and strategic marketing plans.
Marketing Builds Company Reputation
In order to conquer the general market, marketers aim to create a brand name recognition or product recall. This is a technique for the consumers to easily associate the brand name with the images, logo, or caption that they hear and see in the advertisements.
For example, McDonalds is known for its arch design which attracts people and identifies the image as McDonalds. For some companies, building a reputation to the public may take time but there are those who easily attract the people.
With an established name in the industry, a business continues to grow and expand because more and more customers will purchase the products or take advantage of the services from a reputable company.