26 May 2019

Sales Vs Marketing

Note: This post is motivated by a recent chat I had with a marketing consultant in LinkedIn.

Chatting with marketing professionals, I realise that sales and marketing are often considered separate and distinct areas in the industry with marketing being understood as advertising.

From a theoretical perspective, Sales is considered as part and parcel of Marketing as is Public Relations. 

Here is a post (slightly updated) which I wrote in my old University of Warwick blog in 2009 titled "Selling is not Marketing".

What is the first thing that comes to mind when you hear the word "MARKETING"?

A number of people apparently associate it with either a) selling and b) advertising. What I find surprising is that these include several individuals involved in business and in the corporate sector, including marketing managers.

Selling and advertising is part of marketing but it is NOT marketing.

The concept of marketing has undergone drastic changes over the past three decades, evolving from the production era, namely producing products fast and cheap (Remember "Any customer can have a car painted any colour that he wants so long as it is black.” - Henry Ford). That's one problem with companies which rely too much on engineers or tech people without any input from marketers.

I have heard countless stories where the engineers create a "great" product and then push it to the sales and marketing department, to "sell" it to the customers.

If the product fails, it is apparently due to "bad marketing" (blaming the sales and marketing dept.). In a way it's true but not because of the marketing guys (some of whom don't know what marketing is all about). Rather it was doomed right from the start. The customer didn't need it nor do they want it and any amount of marketing (or selling) won't help.

We then moved through the sales and marketing era - the concept that many companies in the UK are still following now: "If you have a good product, then everyone would buy it. You only have to let the customers know". These companies overly rely on advertising in order to push the products to customers. 

It comes as no surprise that a number of companies in the UK and in Malaysia go under all the time. Many of these companies are still living in the sales era of marketing. So, you will see a number of companies spending thousands (if not millions) of Pounds/ Ringitt Malaysia, to get new customers and then ignore them once they sign up.

I am sure that all of you have at least one personal experience, where you were treated like a King or Queen BEFORE you bought the product and service. And then treated like dirt afterwards.

The old adage that if a customer is happy, he/she tells one person while an unsatisfied customer will tell 10 more people, still holds. The only difference is that people now rant on Twitter, Facebook and on their blogs. It's not just 10 more people anymore but rather thousands via online as well as offline word-of-mouth.

The change in marketing focus from the product to the customer occurred during the marketing era, which appeared around the 1960s in the US. Effectiveness and efficiency in meeting customer demands, needs and wants were identified as the key elements in determining companies' long-term success. Now it has moved beyond market segmentation of customers based on their demographics. Researchers also looked at the attitude or lifestyles of consumers- psychographics. Ever wonder what Tesco does with the information provided by millions of their customers using the loyalty cards?

We have since then moved into the relationship era, which emerged during the 1990s. It shifted the focus to the establishment and maintenance of mutually beneficial relationships with existing customers and suppliers. Now, we are not talking about just making a sale. We want loyal customers who would come back for more and bring along others with them at the same time. We are now talking about long-term relationships.

I wonder how many companies are in this era?

Some companies are still hung up on their proud history, their so-called "heritage" and fail to innovate. More importantly, they forgot to take care of their customers.

A good example: Coventry was once the centre of the British car industry. Now, there's only Jaguar left and that too owned by Tata, an Indian company.

So what's my concept of marketing?

I like the latest definition given by the American Marketing Association (2014) which sums up the concept as I understand it: 

“the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners and society at large”

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