nother was a program aimed at encouraging spouses of military person- nel to access counseling services when their spouse is serving overseas.

CHAPTER 1 WHAT IS MARKETING? 11

social marketing

Marketing conducted in an effort to achieve social change.

interests in joining the army; another was a program aimed at encouraging spouses of military person- nel to access counseling services when their spouse is serving overseas.

Similarly, the Environmental Protection Agency (EPA) runs a number of advertising campaigns designed to promote environmentally friendly activities. One such campaign promoted the responsible disposal of motor oil instead of simply pouring it on the ground or into a storm sewer.

There is a difference between these two types of activities. When the army is promoting the be- nefits of enlisting, it hopes young men and women will join the army. By contrast, when the EPA runs commercials about how to properly dispose of motor oil, it hopes to change people’s attitudes and be- haviors so that social change occurs. Marketing conducted in an effort to achieve certain social object- ives can be done by government agencies, nonprofit institutions, religious organizations, and others and is called social marketing. Convincing people that global warming is a real threat via advertise- ments and commercials is social marketing, as is the example regarding the EPA’s campaign to pro- mote responsible disposal of motor oil.

2.3 Individuals If you create a résumé, are you using marketing to communicate the value you have to offer prospective employers? If you sell yourself in an interview, is that marketing? When Taylor Swift sends a tweet about where she is and what she had for lunch, is that marketing? In other words, can individuals mar- ket themselves and their ideas?

Some marketing professionals say “no.” But today, more marketing professionals are saying “yes,” and that self-promotion is a form of marketing. Ultimately it may not matter what you are marketing, even if it’s yourself or another person. If, as a result of reading this book, you learn how to more effect- ively create value, communicate and deliver it to the receiver, and get something in exchange for it, then we’ve achieved our purpose.

K E Y T A K E A W A Y S

Marketing can be thought of as a set of business practices that for-profit organizations, nonprofit organiza- tions, government entities, and individuals can utilize. When a nonprofit organization engages in marketing activities, this is called nonprofit marketing. Marketing conducted in an effort to achieve certain social object- ives is called social marketing.

R E V I E W Q U E S T I O N S

1. What types of companies engage in marketing?

2. What is the difference between nonprofit marketing and social marketing?

3. What can individuals do for themselves that would be considered marketing?

3. WHY STUDY MARKETING?

L E A R N I N G O B J E C T I V E

1. Explain the role marketing plays in individual firms and society as a whole.

3.1 Marketing Enables Profitable Transactions to Occur Products don’t, contrary to popular belief, sell themselves. Generally, the “build it and they will come” philosophy doesn’t work. Good marketing educates customers so that they can find the products they want, make better choices about those products, and extract the most value from them. In this way, marketing helps facilitate exchanges between buyers and sellers for the mutual benefit of both parties. Likewise, good social marketing provides people with information and helps them make healthier de- cisions for themselves and for others.

12 PRINCIPLES OF MARKETING VERSION 3.0

Of course, all business students should understand all functional areas of the firm, including mar- keting. There is more to marketing, however, than simply understanding its role in the business. Mar- keting has tremendous impact on society.

3.2 Marketing Delivers Value Not only does marketing deliver value to customers, but also that value translates into the value of the firm as it develops a reliable customer base and increases its sales and profitability. So when we say that marketing delivers value, marketing delivers value to both the customer and the company. Franklin D. Roosevelt, the US president with perhaps the greatest influence on our economic system, once said, “If I were starting life over again, I am inclined to think that I would go into the advertising business in preference to almost any other. The general raising of the standards of modern civilization among all groups of people during the past half century would have been impossible without the spreading of the knowledge of higher standards by means of advertising.”[2] Roosevelt referred to advertising, but ad- vertising alone is insufficient for delivering value. Marketing finishes the job by ensuring that what is delivered is valuable.

3.3 Marketing Benefits Society Marketing benefits society in general by improving people’s lives in two ways. First, as we mentioned, it facilitates trade. As you have learned, or will learn, in economics, being able to trade makes people’s lives better. Otherwise people wouldn’t do it. (Imagine what an awful life you would lead if you had to live a Robinson Crusoe–like existence as did Tom Hanks’s character in the movie Castaway.) In addi- tion, because better marketing means more successful companies, jobs are created. This generates wealth for people, who are then able to make purchases, which, in turn, creates more jobs.

The second way in which marketing improves the quality of life is based on the value delivery function of marketing, but in a broader sense: When you add all the marketers together who are trying to deliver offerings of greater value to consumers and are effectively communicating that value, con- sumers are able to make more informed decisions about a wider array of choices. From an economic perspective, more choices and smarter consumers are indicative of a higher quality of life.

3.4 Marketing Costs Money Marketing can sometimes be the largest expense associated with producing a product. In the soft drink business, marketing expenses account for about one-third of a product’s price—about the same as the ingredients used to make the soft drink itself. Some people argue that society does not benefit from marketing when it comprises such a huge chunk of a product’s final price. In some cases, that argu- ment is justified. Yet when marketing results in more informed consumers receiving a greater amount of value, then the cost is justified.

3.5 Marketing Offers People Career Opportunities Marketing is the interface between producers and consumers. In other words, it is the one function in the organization in which the entire business comes together. Being responsible for both making money for your company and delivering satisfaction to your customers makes marketing a great career. In addition, because marketing can be such an expensive part of a business and is so critical to its suc- cess, companies actively seek good marketing people. As you will learn, there’s a great variety of jobs available in the marketing profession. These positions represent only a few of the opportunities avail- able in marketing.

< Marketing research. Personnel in marketing research are responsible for studying markets and customers in order to understand what strategies or tactics might work best for firms.

< Merchandising. In retailing, merchandisers are responsible for developing strategies regarding what products wholesalers should carry to sell to retailers such as Target and Walmart.

< Sales. Salespeople meet with customers, determine their needs, propose offerings, and make sure that the customer is satisfied. Sales departments can also include sales support teams who work on creating the offering.

< Advertising. Whether it’s for an advertising agency or inside a company, some marketing personnel work on advertising. Television commercials and print ads are only part of the