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Importance of Marketing

Marketing is an organizational function and a set of processes for creating, communicating and

delivering value to customers and for managing customers‟ relationships in ways that benefit the

organization and its stakeholder.

To describe the importance of marketing, one need not look further than this quote from Regis

McKenna,

“Marketing is everything, and everything is marketing.”

„To deliver a higher standard of living”.

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Importance:

There is even more confusion about what constitutes “marketing. “ Marketing entails several

functions that include:

1. Developing the products or services that customers want.

2. Pricing the products or services correctly.

3. Making the products or services readily available to the customers.

4. Promoting the product or service, which if done correctly, not only convinces customers that

the product or service is preferable to its competition, but that it is clearly the only choice? This

is the field of marketing “communications” and of all the marketing components, it is the one

most likely to be outsourced and the one most likely to be neglected if a company is making a

profit.

I think that effective marketing not only helps to increase sales – it leads to the creation of

a more valuable asset – a RECOGNIZED BRAND – something you might want to sell some

day. I spend a lot of time talking about why a company should invest in marketing; this post

takes a slightly different tact by going beyond the short-term reasons, and explains how a

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company that focuses on marketing will be more attractive to potential investors in the long-

term.

The reality is, most privately owned, small to mid-size industrial business owners will either pass

the reins to their company on to family or look for investors to buy them out when they‟re ready

to retire. If your long-term vision is finding a larger company that wants to buy your company‟s

expertise, technology or share of the market then you‟d better start thinking strategically about

marketing. Here are 7 compelling reasons why:

1. Marketing communications creates “top of mind” awareness

An integrated marketing communications plan that gets your messaging out to the right

target audience, consistently and over time, WILL eventually create the “top of mind” awareness

for your product or service that turns a prospect into a customer. Recognition and awareness for

your company also make it much easier for your sales staff to get someone on the phone or

schedule an appointment. Companies like to do business with companies they “know” and have

positive perceptions of. Likewise, investors like to buy recognized companies.

2. Preferred brands command a premium price – short and long-term

This is the only way you will create a point of differentiation between you and your

competitors. As your customers and the industries you sell to begin to recognize your company

(brand) as the preferred choice for a certain product or service, it allows you to charge premium

pricing. Not only does this boost sales in the “now,” it creates a perception in the minds of future

investors that your business has more value than another one that claims to do the same thing.

3. Happy customers not only send referrals, they create perceived value

Happy customers talk to other potential customers, even in the industrial world. I talk

to manufacturers every day that tell me a good percentage of their new business comes through

referrals from satisfied customers. It takes more than the experiences with your company to

make a satisfied customer – one who is willing to be an evangelist, of sorts. It also takes a

marketing strategy that positions your company (in the minds of your target audience) as the

market leader in overall customer satisfaction and intimacy. It‟s part of the image you build

around your brand – it‟s the magic result of well executed brand development and marketing

communications.

4. Planned marketing communications create a system that can be replicated

This process is one that can be documented and taught like a system. In any

manufacturing or industrial service company, documented processes lend to the overall

impression of the business‟ stability and value. If a potential buyer can see how they too could

operate the systems within your company, even after you are long gone, you‟ll be creating a

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more marketable asset. If you need to, hire an expert: but start creating and documenting a

marketing communications system that you can teach others to run and remove yourself from the

lead generation game.

5. Repeat revenue streams ensure a profit now and later

Recurring revenue, generated from an effective marketing strategy, and teamed with a

stellar customer service approach is a combination that is very attractive to a potential new

owner.

6. Nothing lasts forever: marketing has to be a long-term investment

Consistent and persistent messaging, going to an integrated mix of contact points with

your customers and prospects, is an investment in your company‟s long-term stability and value.

The way to prevent a negative outcome in any of these scenarios is a consistent marketing

communications program. If you‟re keeping your company‟s name out there and building brand

identity and recognition, you have less of an educational process to deal with every time a new

person is introduced to your business.

7. Employees who are “brand ambassadors” sell your company – to customers AND

potential buyers

Understanding their unique role in your company‟s brand promise is just the beginning;

if you want brand ambassadors, you need happy employees. An employee that feels appreciated

and fairly compensated (and that doesn‟t always equate to their salary) is much more likely to

sing the praises of your company. I think it goes without saying; this is good for business today

as well as making an impression on a future investor.

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Key Point:

Ensures we get our goods and services to our customers effectively

and efficiently

Builds and maintains brand value and awareness

Delivers profitable growth

Builds customer value

Enhances shareholder value

Companies that focus on customers‟ needs and deliver great customer

experience is more successful than those that do not.

Simple criteria of marketing needed,

Getting 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 have communication with your

customers 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 externally--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 completion.

Marketing efforts get 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‟

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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.

Considerations:

Although marketing is hugely important for a business to succeed, it can also be very

expensive. In its first year, a company might spend as much as half of its sales on marketing

programs. After the first year, a marketing budget can reach as much as 30 percent--sometimes

more--of the annual sales. A marketing program that gives your company the best chance is a

healthy mix of different forms of marketing, such as website development, public relations, print

and broadcast advertising, design and printing for all print materials, trade shows and other

special events.

Development of Objectives:

Marketing can be used to achieve a number of purposes, such as increasing sales,

providing information or promoting a special event. Determine what you want to accomplish

through your marketing efforts and tailor your message accordingly. For example, if you're

advertising the grand opening of your business and your objective is to get as many people to

attend as possible, offer a prize to the first 100 people who arrive.

So marketing is very important for a business. Any business can be stop without any marketing.