1.1 Added value
Another definition of marketing that is worth considering is from the American Marketing Association (2007):
Marketing is 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.
While this encapsulates many aspects of the CIM definition it introduces a new theme – value. Value in marketing refers to the benefit the customer receives from consuming a product compared to the cost of the product.
For example, purchasing a large flat screen television for £900 may represent a large financial outlay as well as the cost of time and effort spent researching and deciding on brand, product and technology. Related to this are the benefits the customer may receive from purchasing this television such as high definition, being able to watch 3D programmes, being the envy of their friends etc. If the benefits outweigh the cost, the purchase would have ‘added value’ for the customer.. In marketing, all organisations aim to deliver added value. The greater the added value, the more likely the organisation will be successful.
From a marketing perspective, added value is delivered from what is widely known as the ‘total market offering’. This means not only the benefits of the product itself but the organisation’s own brand and reputation. This will be determined by factors such as technological characteristics, distribution outlets, sales staff and other employees representing the organisation. The way all of these contrast (positively and negatively) with the organisation’s competitors will lead to the customer making a decision about their preference, for example, preferring a Bang and Olufsen television to one made by LG.
Stop and reflect
Take a few minutes to stop and reflect on what added value your organisation offers to its customers.