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The Need for an Adequate Definition of Marketing

(adapted from a paper originally published in March, 2001) 

Marketing academics and practitioners have spent a great deal of time on defining the discipline of marketing and measuring its performance.  Agreement on either of these issues, however, has been elusive.  The American Marketing Association (AMA) attempted to settle the issue by creating and publishing a marketing definition of its own:

“Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational goals.” [i]

Looking closely at this definition, it is clear that its root is the concept of ‘exchange.’  Basically the job of marketing, according to this definition, is to facilitate exchanges, albeit need-satisfying.  The logical extension of this definition is to define a marketing professional as one who contributes to the need-satisfying exchange.  This definition and its implications regarding the profession have actually caused greater confusion than clarity.

Confusion comes as a result of the broad application that this definition allows.  That is, almost everyone in an organization contributes to the exchange in some way.  A worker on the assembly line supports the company’s sales by making a better product, a receptionist encourages repeat business by dealing with visiting customers competently, and the CEO clearly generates business by representing the company positively in public.  None of these employees are marketing professionals, however, and certainly not members of the marketing department.

In fact, these “part-time marketers” have been specifically identified as critical elements of a company’s marketing function.[ii]  Gummeson defines part-time marketers as “those who conduct marketing activities but do not belong to the marketing or sales department.”[iii]  This extension of marketing responsibility within an organization can lead managers to contemplate the existence of a distinct marketing department at all.  And this has sent marketing professionals scrambling to justify their existence, particularly at promotion time. 

Only 18% of Fortune 500 CEOs are marketers.[iv]  Despite the fact that almost all of these companies profess to be customer-oriented, only one in five of the largest companies in the world feel comfortable putting a marketing professional at the helm.  Are marketers less capable of leading companies or are they just perceived to be less capable?

Clearly, a more focused definition of marketing is required if the discipline is ever to gain the credibility it so desperately needs.  The definition must be clear, precise and, perhaps most importantly, measurable. 

The AMA definition of marketing is not generally accepted by marketing academics or practitioners.  However, it does reflect much of the work considered to be the foundations of marketing theory.  Well-recognized marketing academics, such as Kotler, Bagozzi, and Murphy and Enis, have all supported a definition of marketing with the concept of exchange at its core.[v],[vi],[vii]  Moreover, marketing educators have generally adopted a similar definition, further promulgating the notion of exchange-centred marketing.  For example, Fundamentals of Marketing states that:

“Marketing consists of all activities designed to generate and facilitate any exchange intended to satisfy human needs or wants.” [viii]

The inadequacy of this definition, as a basis for marketing research and planning, has been identified by researchers.  Notably, Kurzbard and Soldow point out that the AMA definition is far too broad and inclusive to be considered useful.[ix]  Indeed, as these authors point out, in an effort to include all of the possible activities that are commonly considered to be marketing activities, the definition has been stretched to the point of including almost all human activity.  This lack of exclusionary properties leaves the definition almost useless as a basis for academic research.  To this end, Kurzbard and Soldow offer an alternative definition

“Marketing is a mediated activity occurring within the economic sphere that employs strategies intentionally rendered and goal-oriented towards the exchange of goods and services.” [x]

From a practical perspective, the logical concern in using such an inclusive definition of marketing is that almost every employee of the company is considered to be marketing at some level.  In fact, marketing is considered by many to be a guiding philosophy rather than a function of the business.[xi],[xii],[xiii] And perhaps Gummeson’s concept of the part-time marketer is the perfect organizational manifestation of that philosophy. 

Researchers have recognized and questioned the broadening of marketing’s definition.  Bartels, Luck, and Piercy have all suggested that marketing’s definition has broadened too far.[xiv],[xv],[xvi]  The clear concern is that the broadening of the definition will spell the end of marketing as a discrete function of the business and, perhaps, the discipline itself.  Moorman and Rust appropriately ask “what role should the marketing function play, and what value does the marketing function have, if any, in an organization that has a strong market orientation?”[xvii] 

Defining a new role for the marketing department has indeed been the focus of much research.  Moorman and Rust answer their own question with a new model that assigns marketing with the responsibility for managing the customers’ connections with the product, service delivery and financial accountability.  This model shifts the focus of marketing from the traditional four P’s to the interface between the company and its customers.[xviii] 

Grönroos has similarly suggested that the focus of the marketing function should be the customer relationship rather than the exchange.[xix]  In fact, in this model the exchange is said to occur in order to establish and maintain the relationships, rather than the opposite.   Grönroos suggests a new definition of marketing with the customer relationship as the focus:

“Marketing is to establish, develop and commercialise long-term customer relationships, so that the objectives of the parties involved are met.  This is done by a mutual exchange and keeping of promises.” [xx]

In both of these alternative approaches to marketing, the focus is on the company’s interaction with its customers rather than on the processes themselves.  In other words, the definition shifts from a primarily internal view to an external view. 

Unfortunately, although the problems with the definition of marketing have been identified and examined, there is still no generally accepted solution.  However, a few general conclusions can be implied from the research.  First, there is general agreement that the field of marketing encompasses a very broad range of activities.  In fact, the difficulties themselves illustrate the vast scope of the discipline. 

Second, the focal point of the field is in fact the customer.  In virtually all of the definitions put forth the presence of the customer is a necessary condition.  Perhaps, then, the focus of any definition should be the customer, as opposed to the exchange, relationship, or interface.

Finally, the purpose of the definition is to guide strategy development.  While this point may seem somewhat obvious, it is important to note that all of the definitions have attempted to support a model of marketing strategy.  In other words, the definitions should be able to be used to guide marketing decision making and evaluation of marketing performance.

However, among the general agreement there also appears to be a significant gap in the literature regarding marketing definition.  While most of the work recognizes the need for measurement of marketing performance, there appears to be little effort spent on this issue in the definitions themselves.  That is, none of the definitions guide a marketing practitioner in directly identifying and measuring marketing activity.  This gap is particularly glaring when the research is taken into practical application.

All in all, marketing is in desperate need of a clear and practical model by which to define its role.  To this end, I humbly propose the following definition:

“Marketing is the process of creating the hedonic value that, in conjunction with products and services, is a component of the organization’s value exchange.”

In this definition, marketing is viewed as contributing to, as opposed to merely facilitating, the value exchange of the organization.  That is, the activities of the marketing department should create value that is perceived and purchased by customers.  In fact, the value that is built and sold by the marketing department should be viewed in much the same way as that of the firm’s operations department. 

The objective of the firm’s operations department is to create products and services that provide some functional value to the customer.  Using the model proposed above, there is only a subtle difference between this objective and that of the marketing department.  The differentiating characteristic between the two departments is in the nature of the value provided.  The model characterizes the value created by the marketing department as hedonic versus the functional value, or utility, of the firm’s products and services.[xxi]  Value can be alternatively considered tangible (functional value) or intangible (hedonic value).

Marketing literature has long recognized the importance of intangible value in the exchange process.  Levitt suggests that all products are differentiated by some intangible elements of the value proposition.[xxii]  Similarly, Mudambi, Doyle and Wong describe products as a combination of intangible and tangible values.[xxiii]  However, intangible values are rarely treated as discrete components of the firm’s offering that are created specifically for sale, just like any other of the firm’s tangible products. 

It is curious that academics and practitioners recognize the existence and importance of intangibles to the value proposition, but not expect to receive an identifiable return from their creation.  As a matter of fact, even if a return from intangible value was expected and received, who would be assigned the credit and responsibility for their creation?  The marketing department is clearly where this assignment should belong.  In truth, marketing has had this responsibility for years, without the credit or accountability.  This definition recognizes marketing’s role in creating hedonic value for customers by assigning it direct responsibility and accountability. 

Imagine a discipline that is not only practised with no formal training, but even without being aware of it!  Apparently, this is the current state of the marketing discipline, which is so poorly defined that it probably cannot be called a discipline.  Employees are often called ‘part-time marketers’ because they may have an effect on the customer, perhaps even indirectly.  Does this mean, by extension, that every employee that has some impact on costs, which includes almost everyone, is a part-time accountant?

Obviously, the job of marketing is not well understood by managers from any discipline, including marketing.   If it is ever to rise to the level of discipline, like finance or engineering, its practitioners must establish a clear, precise, and measurable definition that expresses its financial accountability.  This paper suggests such a model in hopes of taking even a small step toward the day when Marketing is broadly respected as an important and valuable professional discpline. 

 _____________________________________

[i] American Marketing Association, .

[ii] Gummeson, Evert  (1991) “Marketing-Orientation Revisited: The Crucial Role of the Part-Time Marketer,” European Journal of Marketing, 25 (2), 60-76.

[iii] Ibid.

[iv] Lyon Andruss, Paula (2001) “CEO Wannabes Must Expand Skills,” Marketing News, January 29.

[v] Bagozzi, Richard P. (1975), “Marketing as Exchange,” Journal of Marketing, 39 (October), 32-39.

[vi] Kotler, Philip (1972), “Generic Concept of Marketing,” Journal of Marketing, 36 (April), 46-54.

[vii] Enis, Ben M. and Patrick E. Murphy (1986), “Classifying Products Strategically,” Journal of Marketing, 50 (July), 24-42.

[viii] Sommers, Montrose, James Barnes, William Stanton, and Charles Futrell, (1989) Fundamentals of Marketing.  5th Canadian Ed., McGraw-Hill Ryerson, 4.

[ix] Kurzbard, Gary and Gary Soldow, “Towards a Parametric Definition of Marketing,” European Journal of Marketing, 21 (Jan), 37-47.

[x] Ibid.

[xi] Greyser, Stephen A. (1997) “Janus and Marketing: The Past, Present, and Prospective Future of Marketing,” In Reflections on the Futures of Marketing.  Eds. Donald R. Lehman and Katherine E. Jocz, Cambridge, MA: Marketing Science Institute, 3-14.

[xii] Carmen, J.M. (1973) “On the Universality of Marketing,” Journal of Contemporary Business, 2 (Autumn), 1-16.

[xiii] Kotler, Philip and Sidney Levy (1969) “Broadening the Concept of Marketing,” Journal of Marketing, 33 (January), 10-15.

[xiv] Bartels, R. (1974) “The Identity Crisis in Marketing,” Journal of Marketing, 38 (October), 73-76.

[xv] Luck, D.J. (1969) “Broadening the Concept of Marketing – Too Far,” Journal of Marketing, 33 (July), 53-55.

[xvi] Piercy, Nigel (1998) “Marketing Implementation: The Implications of Marketing Paradigm Weakness for the Strategy Execution Process,” Academy of Marketing Science, 26 (Summer), 222-236.

[xvii] Moorman, Christine and Roland T. Rust (1999) “The Role of Marketing,” Journal of Marketing, 63, 190-197.

[xviii] Ibid.

[xix] Grönroos, Christian (1989) “Defining Marketing: A Market-Oriented Approach,” European Journal of Marketing, 23 (January), 52-60.

[xx] Ibid.

[xxi] The term ‘hedonic’ is used as a classification of value by: Hirschman, Elizabeth C. and Morris B. Holbrook (1982) “Hedonic Consumption: Emerging Concepts, Methods and Propositions,” Journal of Marketing, 46 (3), 92-102.

[xxii] Levitt, Theodore (1980) “Marketing Success Through Differentiation – of Anything,” Harvard Business Review, January-February.

[xxiii] Mudambi, Susan McDowell, Peter Doyle and Veronica Wong (1997) “An Exploration of Branding in Industrial Markets,” Industrial Marketing Management, 26, 433-446.

 

About the Author

Graham Leith has been a business development leader for more than 17 years, specializing in complex, technical markets.  He has worked primarily in the energy industry for some of the industry’s most prominent companies, including Centrica plc, Ontario Power Generation, and TransCanada Pipelines.  He has an Honours Bachelor of Business Administration from Wilfrid Laurier University and a Master of Business Administration from York University.

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Advanced Brand Management: From Vision to Valuation $19.7 Used – ‘Paul Temporal has written a remarkably insightful book on how to build strong brands. He addresses every issue in brand management with sound theories and marvelous examples. This is one of the best books on brand management to help any company build powerful brands’ – Philip Kotler, S.C. Johnson & Son Distinguished Professor of International Marketing, Kellogg Graduate School of Management, Northwestern University. ‘Those building and managing brand assets will find the issues facing th

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Brand Sense: How to Build Powerful Brands Through Touch, Taste, Smell, Sight and Sound $45.65 Used – “A treasury of ideas for bringing new life to your brands, and the cases are truly compelling …should be read by everyone involved in developing or improving a brand. Read this book and watch how the professionals do it”. (Philip Kotler, Professor of International Marketing, Kellogg School of Management, Northwestern University). That gratifying new car smell is actually a manufactured “new car” aroma. The sound of Kellogg’s cornflakes crunching in our mouths is created in sound labs. S

Brand Sense: How to Build Powerful Brands Through Touch, Taste, Smell, Sight and Sound $22.24 Used – “A treasury of ideas for bringing new life to your brands, and the cases are truly compelling …should be read by everyone involved in developing or improving a brand. Read this book and watch how the professionals do it”. (Philip Kotler, Professor of International Marketing, Kellogg School of Management, Northwestern University). That gratifying new car smell is actually a manufactured “new car” aroma. The sound of Kellogg’s cornflakes crunching in our mouths is created in sound labs. S

Building Brands & Believers: How to Connect with Consumers Using Archetypes $19.59 New – “Kent Wertime successfully argues that while products are becoming more alike, brands can avoid ‘commoditization’ by drawing on the rich language of archetypes to tap into more unconscious and emotional levels that influence consumer perception and preference. His book provides a highly suggestive framework for bringing any brand to life.” – Philip Kotler, S.C. Johnson Distinguished Professor of international Marketing, Kellogg Graduate School of Management, Northwestern University “Build

Building Brands & Believers: How to Connect with Consumers Using Archetypes $16.57 New – “Kent Wertime successfully argues that while products are becoming more alike, brands can avoid ‘commoditization’ by drawing on the rich language of archetypes to tap into more unconscious and emotional levels that influence consumer perception and preference. His book provides a highly suggestive framework for bringing any brand to life.” – Philip Kotler, S.C. Johnson Distinguished Professor of international Marketing, Kellogg Graduate School of Management, Northwestern University “Build

Building a Winning Sales Force: Powerful Strategies for Driving High Performance $10.83 ADVANCE Praise for Building a Winning Sales Force: “Building a Winning Sales Force combines the intellectual rigor and practical advice sales leaders need to be market-driven, customer-oriented and highly competitive.”             — Philip Kotler, S. C. Johnson Distinguished Professor of International Marketing,KelloggSchool of Management, Northwestern University   “The sales organization is an intricate puzzle, with the individual pieces only making sense when they fit together to create a complete picture. This book not only gives you the pieces, it also shows you how to assemble them into a winning sales force.” —    Neil Rackham, bestselling author of SPIN Selling and Rethinking the Sales Force   “The authors achieve the rare feat of providing sensible frameworks and instructive examples that address the most important problems facing today’s sales forces. Build­ing a Winning Sales Force has rigor and relevance rolled into one.” —    Kash Rangan, Malcolm McNair Professor of Marketing, HarvardBusinessSchool   “Practical examples and lessons learned from a broad range of industries and experts kept me turning the pages to learn more.”            — Gretchen Garrigues, Commercial Excellence Leader for GE Corporate Financial Services   “The ideas in Building a Winning Sales Force work.  We have used them to transform our sales organization . . . sales processes have become more disciplined and sales­people are delivering greater value to customers.”             — Jeff Foland,

Chaotics: The Business of Managing and Marketing in the Age of Turbulence $0.25 As the fallout from the financial meltdown of 2008 grows progressively worse, companies, industries, and entire markets cling precariously to life or have ceased to exist altogether. And the turbulence may not be over any time soon. In Chaotics, noted business strategists Philip Kotler and John Caslione present the intriguing, if unsettling, argument that these troubled times are not an aberration, but the new face of normal. In fact, the economic downturn is part of a continually oscillating Age of Turbulence, where both risk and opportunity are quickly felt around the world, now inexorably linked by globalism and technology. It’s a world that chews up the unprepared, but rewards the prepared—those robust companies that have the ability to quickly anticipate and effectively respond to potential threats. Packed with illuminating examples of resilient companies that are successfully navigating turbulence, as well as many painful examples of bankrupt or soon-to-be defunct companies unprepared for the chaos that felled them, Chaotics provides deep insights and practical strategies for not only surviving the current economic down­turn, but also thriving amid the many slumps and spurts of prosperity that lie ahead. At the heart of this book is an innovative Chaotics Management System for minimizing vulnerability and exploiting opportunities—and putting your­self way ahead of your competitors, most of whom are clinging to the same old panic tactics of across-the-board staff cuts, deep price discounts, and slashed investments in marketing, branding, and new product development. The system out­lined here helps you completely rethink how you man­age and market during recession and other turbulent conditions, including how to: ● Develop early warning systems for identifying the first signs of upheaval, including disrup­tive