The role of marketing and its relationship with other business activities

Marketing is the management process of identifying, anticipating and satisfying customer needs in a way that is profitable for the business — it is far wider than just advertising.

One marketing objective is to increase market share — to win a larger proportion of total market sales than rivals, for example raising share from 12% to 15% within two years. A business sets this because a higher market share means more sales and greater market power relative to competitors, which can support higher revenue and profit. To be useful it should be SMART, so progress can be measured.

Corporate objectives are the overall, business-wide goals of the whole organisation — for example, to grow profit by 20% over three years. Marketing objectives are goals set specifically for the marketing function, such as increasing market share or brand awareness.

The two are linked through a hierarchy of objectives: marketing objectives must flow from and help to achieve the corporate objectives. So if the corporate objective is to grow profit by 20%, the marketing team might set the objective of raising market share from 12% to 15%, because a higher share should drive more sales and revenue, feeding through to the profit growth the firm wants.

This link matters because it keeps marketing consistent with the rest of the business and ensures marketing spend is focused on goals that serve the firm's overall aims, rather than on activities that do not contribute to corporate success.

Marketing is interdependent with the other business functions, so it cannot achieve its objectives alone.

First, marketing depends on operations. If a marketing campaign succeeds in raising demand, operations must have the capacity to produce enough output at the right quality and on time. If it cannot, the customers attracted by the marketing face shortages or poor products, so the spend is wasted and the brand is damaged. Marketing must therefore agree realistic targets with operations before promising more than the firm can make.

Second, marketing depends on finance. Marketing activities — research, advertising, promotions — need a budget, and the prices marketing sets must still allow the firm to cover its costs and make a profit. Finance limits what marketing can spend and checks the return on that spending, so the two must coordinate on budgets and pricing.

Third, marketing depends on human resources. Delivering a marketing promise of, say, excellent service requires HR to recruit and train skilled, motivated staff; without them the customer experience falls short of what marketing advertised.

Therefore marketing must work closely with operations, finance and HR because its success depends on them: a marketing objective is only realistic if the firm can produce, fund and staff the plan. The closer the coordination, the more likely marketing is to deliver, which is why functional objectives are all set from the same corporate goals.

For a small new business launching its first product, marketing has a strong claim to be the most important function — but the claim must be weighed against the other functions.

The case for marketing being most important is that, for a new business, no one knows the product exists. Marketing identifies whether there is genuine customer demand (through research), shapes the product to meet customer needs, and then makes potential customers aware of it. Without effective marketing, even an excellent product may generate no sales, and a new business with no sales runs out of cash quickly. Because survival in the early stage depends on generating revenue fast, marketing — which directly drives demand and sales — is arguably the function the firm cannot do without.

The case against is that marketing depends on the other functions and cannot succeed alone. Operations must be able to actually produce the product to the right quality and quantity, or the marketing promise is broken. Finance is critical for a new business: without enough cash and careful cash-flow management, the firm fails regardless of how good its marketing is — many new ventures die from running out of money, not from poor marketing. HR matters too if the product depends on skilled people. For a very small start-up, finance/cash flow is often the make-or-break function.

Judgement. Whether marketing is the most important function depends on the firm's immediate constraint. For a new business whose main risk is being unknown and generating no sales, marketing is usually the most important function, because demand is the binding constraint. However, where the binding constraint is cash (a common cause of early failure) or the ability to produce the product at all, finance or operations becomes most important. The most defensible conclusion is that marketing is usually the most important function for a new business to generate the demand it needs to survive, but it is only effective if finance keeps the firm solvent and operations can deliver — so for the overall survival of a small start-up, finance and marketing are jointly critical, with the priority depending on the firm's most pressing risk.

Marketing objectives — goals such as raising sales, growing market share, building the brand or entering new markets — are set for the marketing function but pursued within a single, interdependent business. Whether they can be achieved without the support of finance, operations and human resources depends on the nature of the objective and the firm's circumstances.

The case that marketing can achieve some objectives largely on its own. Certain marketing objectives are mainly within marketing's own control. Building brand awareness, for example, depends largely on research, advertising and promotion decisions made by the marketing team. A clever, low-cost social-media campaign could raise awareness substantially with little direct help from other functions. In the short term, a marketing team with an existing product and budget can run promotions and shift the mix to chase a sales target without major involvement from operations or HR. So for awareness-type objectives and short-term sales pushes, marketing has considerable independent power.

The case that marketing depends heavily on the other functions. Most marketing objectives, however, cannot be delivered alone. An objective to grow market share or sales requires operations to have the capacity to produce the extra output at acceptable quality — a campaign that creates demand the firm cannot supply backfires, harming the brand. It requires finance to fund the marketing spend and to set prices that cover costs and make profit; a firm short of cash cannot run the campaign at all. An objective to enter a new market needs operations to adapt the product, finance to fund the expansion and HR to recruit and train suitable staff. And an objective to raise customer loyalty depends on consistently good products and service, which need operations and HR. In all these cases marketing's success is constrained by what the rest of the business can deliver.

Weighing it up (criterion). The extent to which marketing can act alone depends on the type of objective and the time horizon. Awareness-focused and short-term objectives can be achieved largely by marketing itself, because they rely mainly on promotion within an existing budget. Sales-, share-, loyalty- and new-market objectives — anything that requires delivering more or different products over time — cannot be achieved without operations, finance and HR support, because they hit production, funding and staffing constraints.

Judgement. Marketing can achieve its objectives independently only to a limited extent. For narrow, promotion-based or short-term goals, marketing has real standalone power. But for the substantive objectives that most matter — growing sales and share, entering new markets and building loyalty — marketing cannot succeed without the support of the other functions, because these objectives depend on the firm actually producing, funding and staffing the plan. The most defensible conclusion is that marketing objectives can be initiated by marketing but can only be delivered through coordination with finance, operations and HR — which is precisely why all functional objectives are set together from the same corporate objectives. So the answer is: only to a small extent, and decreasingly so the more ambitious the objective.