Why do Businesses Fail? Part IV

Published: January 13, 2020

Courtesy of Printress.com

Today’s blog is part IV of a 10 part series of “Why Do Businesses Fail?”. This week we shall look at one element that is essential in the financial of any organization: Sales & Marketing. As one who holds a Professional Doctorate in Business Administration in Entrepreneurship and Business Management and who has practiced entrepreneurship for over 40-years, thus consider myself an expert on the subject. Therefore, this is a fact that I not only witnessed but know to be a truism; without something sold consistently in one’s business, it will soon falter and fail.

Sales vs. Marketing

Firstly let’s be clear, there is no other element in the business process that puts money into one’s bank account over sales. Therefore, if nothing sold, then all these other things or stuff that we do, really don’t matter. For example, all the planning means nothing if one can not have enough sales coming in to outperform the expenses that are occurring within the business. Therefore put another way if business expenses exceed income coming in this is a recipe for bankruptcy and failure for the organization can not contain its self for a prolonged time without an infusion of fresh capital from somewhere. Now, what about Marketing Management?

 Where does the Marketing Management square between Sales Management? In Philip Kotler and Kevin Lane Keller’s 14th Edition on Marketing Management, they define the evolvement of marketing in the 21st Century the involvement of four interdependent elements of marketeers for a holistic marketing environment than encompasses all area of marketing for a new 21st Century marketer:

  • Internal marketing; the embracing of everyone in the organization that marketing is an organizational factor encluding senior management.
  • Integrated marketing, thus, the development of multiple means of creating value. And delivering communication and benefit to employees and other stakeholders.
  • Relationship marketing; having a multidimensional relationship with one’s customers, channel members, and other marketing constituents.
  • Performance marketing; the return of understanding to the marketing process thus, to addressing broader concerns and there legal, social, and business environment, and better education for the customer’s experience.

In short marketing, strategically caters to the education of said customers in providing them with what they desire through research on what they want. Whereas, when done correctly, the customer will contact marketing due to this is what they want. Marketing then, sharing this information with the sales department for them to close the sale.

So What is Marketing?

Cordially marketing is identifying and solving and meeting some human and social needs on behalf of one’s customers and meeting those needs profitably. Hence, in the marketing process, there are 10-main types of entities:

  1. Goods: physical items
  2. Services: none tangible items
  3. Events: trade shows, company anniversaries, World Cup
  4. Experiences: Disneyland, a four-day rock & fantasy camp
  5. Persons: CEOs, Artists, Celebrities
  6. Places: cities, states, regions
  7. Properties: real estate, stocks, bonds, mutual funds
  8. Organizations: churches, business organizations; private and non-private
  9. Information: newspapers, books, schools, and universities
  10. Ideas: entrepreneurship, inventions, social markets

Marketers take these 10-main types and turn them into an economic value for its creator of these events.

The Scope of Marketing

The scope of marketing touches everything we do; however, it is its process of developing an idea into some economic value on the beholder or buyer thereof. Then transferring that value of the interested party to the sales staff and through its process of moving the prospect through its sales cycle to closing, which is cash in the bank to do the entire process again, and again. This contuse cycle of marketing and sales, when done correctly and consistently, will bring profits to the organization. Thus, for the organization to be profitable and survive, it must have a positive balance between the organization’s cost/expense and sales.

So, in the end, both management processes are essential in business, and they both work together to bring economic value to the organization and society as a whole. Marketing and Sales Management are so crucial that without either business will fail and cease to be in existence, and this is a disrupter to the economy, loss of jobs, and tax base to communities. These two areas are the blocks of building and maintaining a vibrant economic business community not only nationally but globally as well. So join us next week for part V of “Why do Business Fail?”. And as always, let us know what you think through your comments on the post.

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