Question

Explain importance of marketing to firm.

Answer 1

1. Increases Awareness:
   The major objective of marketing is to create awareness about the existing products, new arrivals as well as the company which sells a particular product in the market. This helps to raise awareness among potential customers and helps to create a brand image.
2. Creates Trust:
   People prefer to buy from businesses that have a trustworthy reputation. Creating trust takes time. Creating trust help the business to earn loyal customers. If customers are happy, the brand image of the company increases in the market. Effective pricing policy and providing after sales service on time helps to improve image of the organisation. A majority of marketing efforts are taken to build the brand equity of the business. E.g.: Some companies in India which have earned consumer trust are TATA, Godrej, Amul, Parle-G etc.
3. Tackling the Competition:
   There is an increasing competition in almost all the sectors of the economy. In such a situation it is difficult for any business to create monopoly. Marketing creates a brand image in the minds of potential customers. It not only helps in communicating about the products and services to the consumers but also motivates them to buy the same. Effective marketing strategies help businesses to create a better image of their business than that of their competitors. Businesses can also take the help of modern technology to make their marketing more effective.
4. Increases Sales:
   Marketing creates awareness among the potential consumers regarding the products or services. This attracts them to purchase the same. Successful marketing campaign helps in increasing the sales of the organisation which in turn increases the profits for the organisation. These income and profits are reinvested into the business which helps the business to earn more profits. In modern business, survival of any business depends on the effectiveness of the marketing function.
5. Basis for Making Decisions:
   From the formation of an idea to delivering the final product to the consumer a businessman has to take several decisions. He has to take decisions like what, how, when, how much and for whom to produce. With an increase in the scale of operations the decision becomes more difficult. Marketing helps the business in taking the right decisions.
6. Source of New Ideas:
   Marketing helps business to understand the needs of the consumers. Feedbacks from the consumers help in the improvement of the existing products. There is rapid change in tastes and preference of people. Marketing helps in understanding these changes. It helps to understand new demand pattern emerged in the market. Research and Development department develop products accordingly. The 4p's of marketing mix i.e. product, price, place and promotion play a huge role in the product development. Inventions and innovations are taken place as per the need by the Research and Development team of the business.