Question

State the importance of marketing to the firm.

Explain the importance of marketing to the firm.

Answer 1

The importance of Marketing to the Firm is as follows:

1. Increases Awareness: Marketing helps in creating awareness about existing products and new arrivals as well as the company which sells a particular product in the market. This raises awareness among potential consumers. It creates a brand image among consumers.
2. Increases Sales: Once marketing creates awareness about the products or services among the consumers, it attracts them to purchase the same. A successful marketing campaign helps to increase the sales of the organisation. An increase in sales generates profit for the organisation. This income and profit are reinvested in the business to earn more profits in the future. In modern business, the survival of the organisation depends on the effectiveness of the marketing function.
3. Creates Trust: People want to buy from a business that has a trustworthy reputation. Creating trust among customers is a time-consuming process. Creating trust among the consumers helps the business to earn loyal customers. Once your business can establish this trust with your clients, it creates customer loyalty. Happy customers enhance the brand image in the market. Effective marketing plays an important role in building a relationship between customers and the organisation. Effective pricing policy and timely after-sales services improve the image of the organisation. A majority of the activities of marketers are directed toward building the brand equity of the business.
4. The basis for Making Decisions: From the inception of an idea to delivering the final product to the customer, the businessman has to make several decisions. The businessman has to look after many problems, such as what, how, and when. How much and for whom to produce? As the scale of operation increases, these decisions become more complex. Marketing helps to make the right decision at right time.
5. Source of New Ideas: Marketing helps businesses understand the needs of consumers. Feedback from the consumers helps in the improvement of the existing products. There is a rapid change in the tastes and preferences of people. Marketing helps in understanding these changes. It helps to understand the new demand pattern that emerged in the market. The research and Development department develops products accordingly. The 4Ps of the marketing mix, i.e. Product, Price, Place, and Promotion play a huge role in product development. Inventions and innovations are taken place as per the needs of the research and development team of the business.
6. Tackling the Competition: There is increasing competition in almost all sectors of the economy. It is difficult for any business to create a monopoly on its products and services. The role of marketing is important because it creates a brand image in the minds of potential customers. Marketing not only helps communicate the products and services to the consumers but also motivates them to buy them. Sound marketing strategies can portray a better image of the business than the competitors. Businesses can take use of modern technology for effective marketing.