Marketing is an essential part of any business, be it a huge corporation or a startup. In basic terms, the marketing function refers to all the processes involved in promoting a company’s products or services. It encompasses everything from understanding customer needs to developing new products and setting reasonable prices.
While casual audiences may only view marketing as normal ads or promotions, it performs several interconnected core functions that drive business success.
This article will provide a comprehensive yet friendly overview of the 7 key functions performed by marketing experts.
These 7 functions of marketing allow businesses to create sustained engagement with customers, promote their offerings effectively, fulfill demand, facilitate sales, and ultimately strengthen growth even in advanced markets.
So get ready to learn the basics of what effective marketing does for every company.
What Are Marketing Functions?
Marketing functions refer to the key activities and processes that make up a business’s overall marketing efforts.
These core marketing functions allow companies to analyze markets, attract new customers, engage with existing ones, and promote sales and growth.
Marketing functions encompass market research to understand what customers want, figuring out pricing and promotional strategies, developing new and improved products that serve customer needs better, distributing the offerings so target customers can easily purchase them, selling the products or services, and providing ongoing support and service.
Marketing functions encompass a full cycle of responsibilities, right from identifying what the market demands, creating value through goods/services to meet those demands, promoting and selling those offerings, and sustaining loyal customers over time through good after-sales service.
Each function focuses on a specific aspect, but they work together to acquire and retain customers.
For instance, advertising and sales work to convert customer interest into sales, while customer service ensures post-purchase satisfaction.
When a function is performed effectively for a longer period, then these marketing functions generate revenue and growth for companies, even in a competitive environment.
Hence, they are an effective investment for businesses to become successful in any industry.
Why Are Marketing Functions Important?
Marketing functions play an important role in allowing businesses to achieve success when selling products or services.
Marketing is important for the following key reasons:
- Marketing provides valuable insights into customers and markets through continual and in-depth research.
It identifies the target audience, their needs and demands, factors that influence purchasing decisions, pricing factors, and competitive offerings.
These insights help companies develop suitable offerings.
- Marketing promotes products and services that deliver greater value to customers based on those insights. This ensures that business offerings match accurately with customers in a better way.
- Marketing is responsible for putting together factors like pricing strategies, promotional campaigns, ideal distribution channels, and sales initiatives that make the offerings easily available, visible, and compelling for the target customers.
This assists awareness, interest, and the conversion of prospects into actual buyers.
- The customer service function under marketing helps in providing relevant support and handles the post-purchase needs of customers. This nurtures loyalty and repeat business.
- Marketing appoints companies to identify and create precisely what customers want, make those offerings discoverable through optimal channels and messaging that will encourage the purchase journey, and acquire an ongoing mutually beneficial relationship.
This sustains revenues and business growth in the long run.
Without investing appropriately in marketing and its core strategic functions, companies operate without considering actual customer perspectives, preferences, or decision drivers. This leads to poor conversions and failure.
Hence, marketing functions are responsible for crucial visibility and help in driving success.
What Are The 7 Functions of Marketing?
Marketing serves several key functions that collectively allow businesses to acquire new customers, retain existing ones, maximize sales, and achieve sustained growth and profitability.
Here we explain the 7 core functions that marketing performs for a business:
1. Marketing Research
The marketing research function involves gathering, analyzing, and interpreting relevant data and information about target customers, markets, competitors, and industry trends.
Features:
- Identifies target audience: Using both quantitative and qualitative research on aspects like demographics, psychographics, behavior patterns, etc. It helps define appropriate customer segments to cater to.
- Understands buyers: Marketing research seeks to understand buyer decision drivers and what influences brand choice and purchase decisions. What needs to exist? What problems need solutions? What values do customers seek?
Answering these questions allows for aligned product design and branding.
- Provides market sizing estimates: Industry analysis guides demand forecasts. What market size exists for which products? What trends indicate growth potential? This data guides production and investment decisions.
- Competitor benchmarking: Monitoring competitor performance, offerings, unique selling propositions, and market share highlights what competitive advantage your own firm needs.
- Consumer sentiment analysis: Continuous analysis by interfacing with customers, mining reviews, or social media listening flags consumer main points, shifts in sentiment, or emerging expectations to address.
Marketing research reduces uncertainties and uncovers opportunities by providing data-driven insights into consumer behavior and market forces relevant to the company.
2. New Product Development
The new product development function in marketing involves generating ideas and converting them into physical products or services that offer unique value to customers.
Features:
- Addresses unmet needs: Using insights from market research on consumer needs, it spots opportunities for new products that fulfill unmet demands.
- Focuses on innovation: Seeks to incorporate the latest technologies, features, design elements, etc. To create products that are an upgrade over existing options.
- Ensures commercial viability: Assesses if enough customers exist who are willing to pay for the product to justify development costs. Considerations are given to production and distribution viability too.
- Concept and product testing: Develop the first model and collect customer feedback through surveys, focus groups, etc. Refines the products iteratively based on learning.
- Minimizes time-to-market: Use project management principles to expedite launch, keeping in mind that dynamics may change with time.
- Drives differentiation: Unique features, a creatively fresh approach, superior ingredients, etc. Make the new product stand out among competitive offerings.
- Compliance assured: Considers regulatory and compliance needs proactively for product approval and intellectual property protection.
The result of this function is new and improved products like gadgets with upgraded features, foods made from organic ingredients, or software integrating intuitive AI – addressing evolving consumer expectations better and thereby garnering greater market share for companies.
3. Pricing
The pricing function involves strategically establishing ideal prices for the products and services on offer.
Features:
- Factoring costs: Considers production, distribution, and promotional costs involved while arriving at sustainable, profitable price levels.
- Analyzing competitor pricing: Benchmarking against competitor price points for similar offerings ensures parity or the desired premium positioning.
- Addressing customer willingness to pay: Market research guides price thresholds that provide value perception among target customers for maximum conversion.
- Supporting positioning: Premium pricing coupled with finer ingredients, new technology, etc. Aids luxury brand positioning. Economy pricing frames value positioning.
- Price skimming: Higher introductory pricing helps recoup development investments faster for radically innovative products before the competition catches up.
- Penetration pricing: Introductory low prices aid rapid market share gains for products needing strong network effects or scale, like social media platforms and payment wallets.
- Managing price fluctuations: Dynamic pricing helps account for off-peak vs peak demand cycles and temporary supply crunches in industries like tourism, electronics, etc.
- Using psychological cues: Tactics like charm pricing at $49 instead of $50 give the illusion of greater affordability, spurring purchases.
Through strategic use of these pricing techniques, marketing helps maximize revenues while also framing brand positioning for competitive advantage. Pricing optimization forms an integral component of the overall offering.
4. Promotion
The promotion function of marketing involves using suitable channels to create awareness about offerings, communicate their value, develop the brand image, and motivate purchases.
Features:
- Inform and educate: Runs advertising campaigns via platforms like television, out-of-home billboards, digital ads, print, etc., communicating product features, how they fulfill customer needs better, and brand ethos.
- Public relations: Seeks earned media through press releases and cultivating independent endorsement of products through critics, industry experts, or influencers, adding credibility.
- Sales promotion: Short-term incentives spurring actions like discounts, free trials, bonus packs, contests, etc. entice purchase consideration.
- Personal selling: Use a salesforce trained in customer-centric and consultative selling to demonstrate value in one-on-one interactions with leads and secure conversions.
- Direct marketing: One-to-one promotion through emailers, catalog distribution, SMS marketing, etc. targets more niche groups open to personalized offers to increase qualified leads.
- Digital presence: Websites, search marketing, and social media build organic discovery and rich customer interactions, helping sustain engagement and conversion across touchpoints.
Using the right promotional mix suitable for target groups, this function aims to cut through the wider clutter and connect branding with consumer aspirations for building equity and preference that show up in actual purchase behavior.
5. Distribution Channels
The distribution function in marketing deals with how to effectively make products and services available & accessible to customers when and where they need them.
Features:
- Channel selection: Choose direct distribution to customers or indirect distribution via channel partners based on considerations like target market, product type, concentration of customer base, etc.
- Channel partners: Develops symbiotic relationships with resellers, retailers, dealers, etc., equipping them to represent offerings suitably to their niche customer segments.
- Channel management: Closely monitors channel partner performance on metrics like market coverage, revenue contribution, customer service levels, etc., taking corrective actions as needed.
- Inventory management: Channels provide intelligence into demand forecasts based on which production and inventory management ensure optimal stocks across points of sale.
- Experience focus: Partners are trained, supported, and incentivized to offer customer experiences in sync with the brand throughout the purchasing process.
- Logistics optimization: Uses supply chain analysis and technologies to minimize order turnaround times for customers in the most efficient ways.
- Omnichannel enablement: Integrates channels to provide consumers with a seamless, unified brand experience across online, retail stores, contact centers, etc.
Getting the distribution strategy right ensures products reach every intended customer segment conveniently and cost-effectively, fulfilling demand in a timely way for sustained sales and customer satisfaction.
6. Sales
The sales function refers to the processes and initiatives focused on converting pre-qualified leads and new prospects into actual paying customers and nurturing repeat transactions.
Features:
- Lead management: Marketing provides leads via promotions and sales, further qualifying them to identify likely buyers worth targeting to avoid wasting time.
- Understanding needs: Sales personnel are trained to diagnose prospect needs, match the benefits of offerings accordingly, and articulate value propositions persuasively.
- Managing sales cycles: Structured sales processes catering to product/industry nuances help progress prospects smoothly across awareness, interest, evaluation, and closure stages.
- Consultative selling: Customized product configurations, additional services, etc. may be bundled to address prospects’ unique needs for higher perceived gains.
- CRM optimization: Customer interactions and purchase history via integrated systems equip sales to personalize cross-sell/upsell opportunities, driving greater lifetime value.
- Analytics focus: Tracking lead quality, conversion ratios, channel effectiveness, etc. helps refine strategies to improve results.
- Compensation design: Commission structures and incentive programs keep salesforce motivation and productivity high on key growth metrics.
With strategic priorities aligned with business goals, sales translate marketing-generated leads into revenues while also providing customer feedback for further fine-tuning of overall efforts.
7. Financing and Customer Service
The customer service function in marketing involves providing support and assistance to customers during and after purchase to drive satisfaction, loyalty, and repeat sales.
Its financing component focuses on enabling customers to fund purchases.
Features:
- Assisting purchase journey: Helps customers navigate product details, purchasing processes, etc., responding to queries promptly via live chats, and call support.
- Financing options: Tie-ups with lending partners to provide EMIs, buy now, pay later schemes, etc., breaking up costs over months and making buying easier.
- Managing orders/payments: Order management and payment gateway integrations are enabled with tracking capabilities for a smooth purchase experience from order to delivery.
- Education on product use: Setting correct expectations on product capabilities, tutorials on ideal usage, etc. reduces teething troubles and improves the usage experience and satisfaction.
- Query/issue redressal: Multiple interfaces, including email, social media, chatbots, voice calls, etc., offer convenient channels for customers to resolve concerns. Quick reaction and fair resolution minimize dissatisfaction.
- Feedback channels: Seeks feedback through surveys, review calls, etc., welcoming suggestions to pinpoint areas for improving products or purchase/usage experience.
- Retention focus: Loyalty programs with personalized rewards/privileges provide incentives for repeat purchases. Special promotions/value offers target at-risk customers.
By proactively looking after customer needs throughout the lifecycle, marketing builds trust and long-term engagement, making the customer’s voice an input for continuous improvement rather than just a commercial transaction.
Conclusion
An effective marketing function is invaluable for business success in competitive markets. As discussed above, the 7 key functions of marketing play an interconnected role in allowing a business to understand customers, create value for them continuously, and ultimately sustain revenues and growth.
Every business must invest in performing these core marketing functions, even on a basic level, to drive progress. The marketing mix will vary for different companies depending on aspects like industry, size, and resources.
However, if performed well, marketing provides a competitive edge for companies to move ahead.
