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July 21, 2014

Marketing Functions


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Friends, hope your preparation of upcoming SBI Clerks is going on well. As you know, we have already provided you with marketing study materials and online tests (you can read them here). Today we shall discuss about another important topic of marketing, i.e., the Functions of Marketing.

The functions of Marketing can be grouped into the following four categories.
  1. Functions of Exchange
    1. Selling
    2. Buying
    3. Demand Creation
    4. Price Determination
  2. Functions of Physical Supply
    1. Transportation
    2. Storage
  3. Functions of changing form of product
    1. Grading and standardization
    2. Packaging
  4. Facilitating Functions
    1. Financing
    2. Risk taking
    3. Marking Information
Now lets have a detailed look of about categories.

1. Functions of Exchange : These include the activities connected with transfer of goods and services through exchange process. It involves the following :
  1. Selling : Selling is the act of transferring goods and services to buyer through a sale transaction. However, selling involves various activities like product planning and development, locating and contacting buyers, including them to buy and negotiating terms of sale and entering into sale agreement.
    • The function of selling is performed by company sales offices, distributors, wholesalers, retailers and other members invovled in channels of distribution. In order to promote sales, a company uses differetn methods like advertising, publicity, personal selling, sales promotion etc.
  2. Buying : The performance of buying function in marketing involves a number of distinct but closely related activities whether they are carried out by manufacturer, wholesaler, retailer or consumer. These activities include :
    1. Planning the needs and identifiying the products to be purchased (quality, quantity, schedule of purchase etc.)
    2. Searching for sources of supply
    3. Selection of supplier / suppliers
    4. Testing the suitability of products and services to be supplied
    5. Negotiations (about price, date of delivery etc)
    6. Transfer of title or use of rights
  3. Demand Creation : The function of demand creating consists of activities like informing the public about products, its characteristics and uses to consumers and motivating them to purchase products.
  4. Price determination : Price determination is very important aspect of marketing. Prices constitute source of income to company and expenditure to the consumer.
2. Functions of Physical Supply :  Marketing mainly involves movement of goods from producer to consumer. This physical transfer of goods involve 1. Transportation 2. Storage.
  1. Transportation : It involves physically carrying products from pace to place through some mode of transport. It is a part of every phase of marketing. 
    • Different modes of transportation like bullock cart, truck, bus, train, aeroplane, ship etc., can be used for the movement of goods. However, the pros and cons of using each mode should be carefully analyzed before selecting appropriate mode. A company can engage its own transport or depend on services of transport agencies.
  2. Storage : Storage function provides time utility by holding and preserving products and delivering them according to the requirements of market. If production is seasonal and demand is stable (e.g. agricultural produce) storage becomes essential. As the demand is uncertain, goods must be stocked at every level.
    • Storage is provided by manufacturer, middlemen or public agencies. The period of storage and method of storage varies according to the nature of products and other factors.
3. Functions of changing form of product : These functions relate to putting the products into usable form. It mainly includes - grading, standardization, quality control and packaging activities. 
  1. Grading and standardization : Grading means sorting of products into different lots each of which has substantially same characteristics with respect to qualify. Grading helps selling by description rather than personal verification. It helps buyers to select the most suitable produce for their use. 
    • Standardization implies the establishment of uniform quality specifications on the basis of grades. It helps purchasers to buy products easily on the basis of recognized standards with confidence.
  2. Quality Control : Quality control refers to the efforts on the part of the producers and marketers to improve quality of products to secure greater uniformity of quality. Quality control helps in expanding sales and demand for company products.
  3. Packaging Activities : A package is a wrapper or container in which a product is enclosed, encased or sealed. Packaging is, therefore, an act of designing and producing the package for a product.
In modern marketing, packaging performs several functions like - protecting products form spoilage, deterioration, helping brand identification, helping product handling, communicating product message etc.

4. Facilitating Functions : Facilitating functions help marketing activities to be performed smoothly. The important are - financing, risk bearing and marketing information. Lets have a detailed analysis of them.
  1. Financing : Marketers need finance for distributing and promoting sales. The finance for marketing can be obtained from various sources such as - banks, financial institutions, individuals etc. The extent of availability of finance depends on banking policy, availability of money from private sources, credit policy etc.
  2. Risk Taking : In marketing operations, there is risk of financial loss due to price fluctuations, quality deterioration, quantity losses, changes in styles of consumers, wrong placement of products, human risks etc. Some of the risks may be avoided by taking insurance coverage and hedging operations. Some risks can be transferred to middlemen (dealers, wholesalers etc) who take responsibility of selling. Some can be avoided by adopting better managerial practices. 
  3. Marketing Information : Information forms the basis of several marketing decisions at various levels. Therefore, collection, processing, using, disseminating and again taking feedback are very important aspects in marketing management. 
Information can be collected from various sources such as - customers, dealers and middlemen, competitors, government and research institutes. Company gets it through it's salesforce, market surveys, public relations etc.

Information dissemination is done through advertising, publicity, personal selling etc., Some times, company may engage the services of special agencies and consultants to obtain information.

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  1. Thanks gr8 ambitionz team plz post more on marketing strategies

  2. Thanks mam/sir please provide marketing short notes in hindi
    Please as soon as possible
    Please reply


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