Just what is marketing?

During a presentation of my new book, The Failure Of Marketing, we discussed the appropriate definition of marketing. Most agreed with me that marketing was about a relationship while sales were about transactions. However, most also defined the relationship as one in which the marketer provides a product or service and the customer provides money. I suggested that this was no more than a transaction that looked like this:

My audience argued that when a customer continually repeats the transaction over time it becomes a relationship. But, I countered, this still is not marketing. It’s simply a transaction repeated again and again and again. Here's the difference. When another company comes along with a new product that better meets the needs of the customer, the customer will shift allegiance. If this were truly marketing, the first company would always be looking to improve its product whether by meeting changing needs or adopting new technology.

This customer relationship looks like this:

Notice here that the customer is at the top and provides to the marketer a discussion of needs and wants. The marketer now understanding the changed needs of the customer creates a new or improved product that better meets those needs.

This is a dynamic model of the marketplace that reflects the reality that customer needs and technology are continually evolving. If the marketer is going to gain and maintain the loyalty of the customer, he must continually monitor these changing needs and create innovative products that better meet them than his current products.

That’s how you create customer loyalty. That is marketing.