Searching some familiar sites I was surprised to see that the American Marketing Association without much fanfare adopted again a new definition of the term Marketing, only three years after the previous revision. Since some of my readers are possibly not aware of this development I copy the text presenting the new and old definitions and the raison d'être for the change as one can find it in the web site of the AMA:
“New Definition of Marketing (est. in 2007)
Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.
Previous Definition (est. in 2004)
Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.
The new definition takes into account input from a broad cross-section of the Association membership. Marketing is regarded as an 'activity' instead of a 'function' and positions marketing as a broader activity in a company/organization, and not just a department. The new definition also positions marketing as providing long term value rather than narrowly as an exchange of money (short-term) for the benefit of the shareholder/organization.”
Source: http://www.marketingpower.com/Community/ARC/Pages/Additional/Definition/default.aspx
I am glad with the new definition if only for one reason: The new focus of the on “providing long term value rather than (positioning marketing) narrowly as an exchange of money (short-term) for the benefit of the shareholder/organization”, as AMA explains.
As you possibly remember sometime ago I criticized the almost religious emphasis of the contemporary management on short-term results and “shareholder value” as a strategy mantra that has caused and keeps causing substantial damage to corporations, the economy and the society in general. The colleagues of the AMA seem to worry also about the impact of the short-termism and “shareholder value” and decided to take action by pronouncing the “transparency, broad participation and continuity” as the basic tenets of the new definition while restating the client/customer and the society as beneficiaries of the marketing.
Interestingly the new definition came about with feedback provided by the industry that clearly was in favor of a new definition rather than a revision of the old one. Possibly the endless stream of corporate scandals and several examples of top (mis)managers often rewarded with hundreds of millions of dollars in stock options have contributed in this attitude. I also suspect that the increasing recognition by marketers of the new role of the customer and the customer empowerment have played also some role here.
I hope that the new definition of the Marketing will help the corporate management to correct its course and re-focus to their customers than the shareholders. It should also help marketers to better understand their mission and give to the marketing the position it deserves as corporate activity.
