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Marketing Process

Marketing Process

Instead of interrupting, work on attracting.

- Dharmesh Shah

As consumers are exposed to more and more advertisements on social media, TV, outdoors, etc., marketers need to attract customers to the product or brand rather than interrupting their daily activities with them. How can marketers do this? By optimizing the marketing process. The marketing process is a process through which brands create customer value and thus build sustainable and profitable customer relationships. Are you curious to learn more about the marketing process's steps and methodology? Read along.

Marketing Process Definition

The marketing process is one of the foundational concepts of marketing. The marketing process is a tool through which businesses can create customer value. As a result, the definition of the marketing process is as follows.

The marketing process is a five-step process marketers use to create customer value and build long-lasting customer relationships.

The idea behind the marketing process is that by creating value for customers, businesses also create value for themselves. In other words, by understanding customers and developing products and services that customers want and need, the company also creates value for itself through sales, revenue, profit, and customer relationships.

Marketing Process Steps

Now, let's take a look at the marketing process steps. The marketing process includes five steps in total. They are as follows:

  1. Understanding customers and the market,

  2. Creating a customer-driven marketing strategy,

  3. Creating an integrated marketing plan,

  4. Fostering long-term sustainable customer relationships,

  5. Capturing value from customers.

Figure 1 below outlines the marketing process steps.

Strategic Marketing Process

Now that we are familiar with the five key steps of the marketing process, let's look at each one in more detail to understand the strategic marketing process.

Marketing Process: Understanding customers and markets

The first step of the strategist marketing process includes understanding customers and markets. The foundations of this step include understanding customer wants and needs.

A customer need is something an individual needs in terms of survival. These include basic necessities such as food, water, shelter, or clothing.

A customer want is something that an individual desires. For instance, an individual needs food to survive; however, there are different types of food the individual might want, such as soup, pizza, or rice.

Customer wants and needs are what create demand in a market. The market is where customers and businesses can engage in exchange relationships. In turn, demand is fulfilled by the market, specifically market offerings. Market offerings are the different types of goods and services businesses create to satisfy customer demand.

Beyond just meeting demand requirements, marketers must also ensure that a good or service creates value for customers. Creating value can lead to satisfied customers who stay loyal to the brand. As a result, it is also crucial for building long-term customer relationships.

Marketing Process: Marketing strategy

The following step involves creating a customer-driven marketing strategy. Now that we understand the basics of markets and customers, it is time to decide which customers and markets to serve.

Creating a marketing strategy involves market segmentation, targeting, and positioning (STP). The STP model helps marketers decide which customers to target and how.

Check out our explanations of Market Segmentation, Targeting, and Positioning to find out more.

Once marketers have selected a target customer group, it is essential to position and differentiate the product. Positioning and differentiation allow the product or service to stand out from competitors by highlighting the value it brings customers, thus, satisfying customer needs.

The business must also decide which overarching concept will lead its marketing strategy. The five key concepts are as follows:

  • The production concept follows the idea that customers will always demand products that are available on the market. Therefore, companies have to focus on maximizing production and distribution.

  • The product concept is the idea that customers demand high-quality products that have useful features and numerous benefits. Therefore, companies should focus on product innovation and differentiation.

  • The selling concept argues that customers will not value or purchase a product unless a brand specifically targets large promotional campaigns at them.

  • The marketing concept follows that companies should create products that satisfy customers' wants and needs better than competitors rather than focusing on production or selling. Therefore, understanding customers is key.

  • The social marketing concept is the most recent one. This concept argues that organizations should satisfy both the short and long-term needs of customers and society in general. The focus here is on maintaining the welfare of the company and society. Therefore, the focus should be on sustainability.

Curious to learn more about sustainability in business? Check out our explanation of Sustainable Marketing.

Marketing Process: Marketing plan

Once a marketing strategy has been established, it is time to create a marketing plan.

The marketing plan outlines how the organization or brand will generate customer value through different mediums.

The marketing plan broadly relates to the 4Ps of marketing: product, price, promotion, and place. The brand can deliver value to its target customers through the different elements of the marketing mix.

Want to refresh your memory? Take a peek at our marketing mix explanation.

Marketing Planning Process

The marketing planning process allows a company to plan out the various activities and tasks required to reach overall business goals. Some of the critical elements of the marketing planning process include:

  • Conducting a market analysis (internal and external),

  • Establishing marketing goals and objectives,

  • Establishing the marketing budget,

  • Implementing marketing tasks required to achieve goals,

  • Controlling the marketing process,

  • Evaluating marketing outcomes.

Check out our explanations of the Marketing Plan and Strategic Marketing Planning to explore this concept in further detail.

Marketing Process: Customer relationships

Once marketers have established an integrated marketing plan, they must focus on building customer relationships. Every brand aims to foster long-term customer relationships to sustain brand preference and customer loyalty.

Customer relationship management (CRM) is the overall process of interacting with customers to build long-term sustainable relationships.

The primary goals of customer relationship management are to:

  • Increase customer value perception by highlighting the benefits and features of products and services,

  • Increase customer satisfaction and mitigate customer dissatisfaction,

  • Engage customers through brand management and marketing communications on various channels,

  • Promote customer-generated marketing (e.g., user-generated content (USG) on social media, customer reviews, competitions, etc.).

Partnership Management

Another important aspect of customer relationship management involves partnership management. Partner relationship management includes nurturing key partner relationships that help the company create value for customers. Key partners may range from supply chain and channel partners to agencies, influencers, etc.

Marketing Process: Capturing value

Once the first four steps of the marketing process are complete, it is time for the company to capture value from customers.

What exactly does this mean? After ensuring value creation for customers, the brand can also capture customer value. This ensures that the brand stays profitable in the long run.

How does a brand capture value? There are a few synergies that allow for this to happen, and they are as follows:

  1. By creating brand preference within target customers and long-term customer relationships, the brand ensures repeat purchases (retention) and customer loyalty. This idea is known as customer equity.

  2. The brand can capture value due to increased market share as a result of creating customer value and inducing retention.

  3. Higher market share and customer loyalty lead to an increase in revenue and profit, contributing to the financial success of the company.

As a result, the marketing process allows customers to gain value from brands and products, while brands can capture value from customer relationships.

Marketing Process Importance

The marketing process is important as it allows brands to understand customers and capitalize on long-term customer relationships. Figure 2 below outlines the four different customer relationship groups.

The diagram outlines the relationship between customer loyalty and company profitability. The four distinguished customer relationship groups are labeled as follows:

  • Butterflies show high profitability potential for the company in the short term. Even by targeting these customers with effective marketing and CRM, the company might encounter little luck turning these customers into long-term loyal ones.

  • Strangers are short-term customers who bring low profitability to the company. It is not worth investing much CRM into these customers; the company should enjoy the fleeting short revenue these customers bring.

  • Barnacles exhibit limited customer-brand fit but are highly loyal to the brand. It can prove difficult to generate profits through these customers. However, the company can attempt to remove certain benefits or increase prices in an attempt to drive profits from this segment.

  • True friends are loyal and profitable customers. The company should invest in significant CRM to engage and retain these customers.

Marketing Process Example

Before you head off, let's briefly examine a marketing process example. Imagine a new clothing brand entering the market.

The clothing brand would begin by understanding customers and the market. The brand's primary goal is to create demand for its products. So, it first outlines methods through which it could bring customer value - its sustainability focus, inclusive sizing, and wide range of delivery options. The following step involves creating a customer-driven marketing strategy. The brand finds its target segment - women aged 18-29 who care about environmental and social equity - and thus follows the social marketing concept for its strategy. The integrated marketing plan outlines the digital communications efforts and activities the brand will pursue to build long-term profitable customer relationships, including a CRM program. Once the brand has established a loyal customer base, it can capture customer value.

Marketing Process - Key takeaways

  • The marketing process is a five-step process marketers use to create customer value and build long-lasting customer relationships.
  • The five steps of the marketing process are:
    1. Understanding customers and the market,

    2. Creating a customer-driven marketing strategy,

    3. Creating an integrated marketing plan,

    4. Fostering long-term sustainable customer relationships,

    5. Capturing value from customers.

  • Positioning and differentiation allow a product or service to stand out from competitors by highlighting the value it brings customers, thus, satisfying customer needs.

  • The marketing plan outlines how the organization or brand will generate customer value through different mediums.

  • Customer relationship management (CRM) is the overall process of interacting with customers to build long-term sustainable relationships.

Frequently Asked Questions about Marketing Process

The marketing process is a five-step process marketers use to create customer value and build long-lasting customer relationships. 

The marketing process includes five steps in total. They are as follows: 


  1. Understanding customers and the market,

  2. Creating a customer-driven marketing strategy,

  3. Creating an integrated marketing plan,

  4. Fostering long-term sustainable customer relationships,

  5. Capturing value from customers.

The marketing process is important as it allows brands to understand customers, provide customer value, and capitalize on long-term customer relationships.

The first step in the market research process includes understanding customer wants and needs. Customer wants and needs are what create demand in a market. The market is where customers and businesses can engage in exchange relationships. In turn, demand is fulfilled by the market, specifically market offerings. 

The final step in the marketing process includes capturing value. After ensuring value creation for customers, the brand can also capture customer value. This ensures that the brand stays profitable in the long run. 

Final Marketing Process Quiz

Question

Define exchange.


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Answer

An exchange is when someone gives up something in return for something else.

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Question

What is an opportunity cost?


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Answer

Opportunity cost is the forgone benefit that would have been derived from an option not chosen.


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Question

Explain why the opportunity cost matters in the exchange process.


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Answer

The exchange must be worthwhile and beneficial for both businesses and consumers. For businesses that means gaining profit from a good or service sold, and for customers that means gaining value for the money paid. What is more, the benefits gained from the exchange must be better than those that could be gained somewhere else.


Show question

Question

What is a need?


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Answer

A need is something that is essential for us to survive.

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Question

Give an example of a need.


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Answer

Food or drink.


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Question

What is a want?


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Answer

A want is something that is desired.


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Question

Give an example of a want.


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Answer

A specific type of food or drink; crisps, or sparkling water.

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Question

Define a customer.


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Answer

A customer is a person who buys a product or service from a business. 

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Question

Is a customer the same as a consumer?


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Answer

No

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Question

What is a marketing mix?

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Answer

The marketing mix is a combination of factors that has an impact on a customer’s decision to purchase a product or service.


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Question

What are the four main factors that influence a customer’s decision to purchase a product or service?


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Answer

Product, price, place, and promotion


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Question

Give an example of a problem that might occur if a business does not know its customers.


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Answer

It may have to:


  • Withdraw the product because of low sales,
  • Amend the product to match customers’ needs,
  • Lower the price to attract customers,
  • End up damaging its brand name.


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Question

What can businesses do to remain competitive?

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Answer

Respond to changes in the market, and be better than competitors.

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Question

Besides customers, who do businesses have to keep an eye on to be competitive?


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Answer

Competitors


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Question

A ___ is something that is essential for us to survive. 

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Answer

need

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Question

A ___ is something that is desired. 


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Answer

want

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Question

A consumer is a person who buys a product or service from a business. 


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Answer

False

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Question

A consumer is a person who uses a product or service provided by a business.


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Answer

True

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Question

___ is the process of gathering, analyzing, and utilising data in order to make effective marketing decisions.


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Answer

Market research 

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Question

The ___ is a combination of factors that have an impact on a customer’s decision to purchase a product or service.


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Answer

marketing mix 

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Question

An ___ is when someone gives up something in return for something else.

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Answer

exchange 

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Question

If you buy a drink for your friend, you are a ___ and your friend is a ___. 


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Answer

customer ... consumer

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Question

Necessities such as food and drink can be categorised as... 


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Answer

needs. 

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Question

Specific types of products such as a new iPhone or apple juice can be categorised as...


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Answer

wants. 

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Question

A customer is a person who...

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Answer

buys a product or service from a business. 

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Question

A consumer is a person who...

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Answer

uses a product or service provided by a business. 

Show question

Question

Market research is the process of gathering, analyzing, and utilising ___ in order to make effective marketing decisions.


Show answer

Answer

data 

Show question

Question

The marketing mix is a combination of factors that have an impact on...


Show answer

Answer

a customer’s decision to purchase a product or service. 

Show question

Question

The four most important factors of the marketing mix are product, price, place and...

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Answer

promotion.

Show question

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