12 min.

Functions of Marketing: 7 Main Business Actions Explored

Each function of marketing plays a pivotal role in creating a great customer journey, from awareness to purchase to post-purchase experiences. 

An effective marketing strategy brings all marketing functions together seamlessly.

In this post, we will discuss the following marketing functions: product and pricing strategy, market research, promotion, sales and financing, distribution and logistics, customer service, and risk management. We will explain the purposes of each and provide real-world examples to illustrate how they work.

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Functions of Marketing Definition

Functions of marketing are a business's main actions, tasks, and strategies to attract and keep customers. It's not just about selling a product or service but about understanding what potential and existing customers want. 

The main function of marketing is to create awareness of products or services and drive customers to purchase action

However, to achieve this goal, a series of complex and carefully planned sub-functions need to be executed:

  1. Crafting product and pricing strategies: Businesses need to decide what their product is, who it's for, and how much it will cost. 
  2. Doing market research: Using various techniques like surveys and interviews, businesses can understand what customers want, what they value, and how to adapt their offerings accordingly.
  3. Promoting the business: This entails creating and amplifying messages about a company's offerings, utilizing methods such as online advertising, PR campaigns, and targeted social media engagement.
  4. Handling sales and financing: This requires managing the sales process effectively, ensuring smooth transactions, and monitoring the business's financial health.
  5. Managing distribution and logistics: Businesses need to get their product from the factory to the customer. They arrange transportation, manage stores or warehouses, and make sure products arrive on time.
  6. Providing great customer service: By promptly addressing queries, resolving issues, and actively listening to feedback, businesses can increase customer satisfaction.
  7. Keeping an eye on risk management: By periodically assessing potential threats, calculating their impacts, and implementing preventive measures, businesses can minimize disruptions to their operations.

When we explore these marketing functions in more detail in the following sections, we'll see how well they blend together to create a well-planned marketing strategy that effectively deals with a product from the point it's made to when it's sold and even after that. 

7 Functions of Marketing: Main Business Actions Explored

Each function of marketing plays an integral part in shaping a customer’s journey from awareness to purchase and even beyond into post-purchase experiences

By creating an effective marketing strategy that seamlessly combines these seven functions, a business can ensure an effective and efficient conversion process. 

Let's discuss these functions, their purposes, and their real-life examples:

1. Product Management (Product Development and Pricing)

This marketing function involves creating new products or improving existing ones based on customer needs and market insights. Pricing strategy is also a key part of product management. The company must set prices that reflect the product's perceived value, cover costs, and remain competitive in the market. 

🎯 Its Purpose: The primary purpose of Product Management is to deliver valuable products to customers at competitive prices, fueling both customer satisfaction and business profitability.

❔ How to implement the Product Management function?

  • Decide what you want your product to achieve.
  • Make a basic version of your product with the key features your customers need (Minimum Viable Product, MVP) and get customer feedback on the MVP.
  • Calculate all the costs involved in creating and delivering your product. Decide on a pricing strategy based on customer value and competition.
  • Develop a launch strategy that introduces your product with minimal promotion.
An example of "Product Management (Product Development and Pricing)", one of the marketing functions, from Allbirds.

For example, Allbirds is a great example of effective product management. The company is known for producing stylish, comfortable, and environmentally friendly shoes that align with the growing interest in sustainable products. The price tag of just under $100 per pair may seem above average, but it's a store with a loyal customer base. This shows the importance of a well-implemented product and pricing strategy in product management.

2. Market Research

Market research is the process of gathering, analyzing, and interpreting information about a market, a product or service to be offered for sale in that market, and the past, present, and potential customers for the product or service. 

🎯Its Purpose: Market research aims to shape a business's marketing strategy by understanding customer needs, preferences, and behavior. It can predict market trends, help create customer profiles, and understand competitive positioning. This function allows businesses to make informed decisions about product development, pricing strategies, advertising, and distribution.

How to implement the Market Research function?

  • Ask for valuable customer feedback through online or offline surveys.
  • Stay updated with the latest trends by using tools like Google Trends.
  • Assess your rivals' products, strategies, and market position to identify your business's unique selling proposition (USP).
  • Collect data regarding customer preferences, behavior, and buying patterns using tools like Google Analytics.

For example, Blume’s survey gathers valuable customer insights about preferences, satisfaction, and areas for product improvement directly. 

An example of "Market Research", one of the marketing functions, from Blume.

This direct feedback mechanism helps the company tailor its product offerings and marketing strategies better to meet the needs and desires of its target audience.

3. Promotion

Promotion is raising customer awareness about a product or service. It uses various marketing channels to reach potential customers, such as social media, radio, television, print media, or direct marketing. For instance, a business might run a social media campaign to launch a new product, offering promotional codes to boost sales.

🎯 Its Purpose: The primary purpose of the promotion is to increase brand exposure, create brand identity, inform and engage potential customers, and ultimately drive conversions. It helps customers to understand why they should choose a specific product or service over its competitors.

How to implement the Promotion function?

  • Establish and promote them. What makes your product/service unique? Use it in all your communications.
  • Collaborate with relevant influencers in your industry to expand audience reach.
  • Retargeting ads on platforms like Facebook and Google can be used to reconnect with visitors who didn’t purchase initially.
  • Initiate unconventional, surprising, and memorable marketing tactics that make a lasting impression.
  • Leverage AR for an interactive customer experience, boosting brand engagement.
  • Encourage customers to create and share content about your products/services. (UGC)

For example, Rhode encourages customers to post pictures and reviews of the Lip Case on social media.

An example of "Promotion", one of the marketing functions, from Rhode..

This results in authentic promotional content created by real users, which helps the brand reach a wider network and increase credibility. Additionally, every time a user takes their phone out in public or shares a selfie, the Rhode brand will continue to promote itself.

4. Selling and Financing

Sales and financing are vital marketing components that connect a business's operational aspects with consumer needs. While sales revolve around building customer relationships and convincing them to buy, financing provides adequate funds to support marketing initiatives and operations.

🎯 Its Purpose: The primary purpose of the selling function is to facilitate the actual purchase by the consumers. The financing function focuses on the monetary aspect, helping customers purchase by offering various finance options. This can involve providing credit, installment terms, discounts, or deals.

❔ How to implement the Selling and Financing function?

  • Estimating future sales accurately helps with better planning and budget allocation.
  • Build strong customer relations for a seamless buying process.
  • Techniques like discounts, rewards, and special offers can encourage purchases.
  • Robust financial planning enables a company to allocate resources effectively.
  • Keep track of sales and marketing performance metrics such as ROI, customer acquisition cost, etc., to understand the effectiveness of different strategies.

For example, Starbucks leverages its Starbucks Rewards Program to drive sales effectively. This program encourages purchases by offering benefits like free drinks after a certain number of purchases. 

An example of "Selling-Financing", one of the marketing functions, from Starbucks.

On the financial side, Starbucks effectively uses its revenue to fund expansions, new stores, and marketing initiatives. They maintain rigorous financial planning, ensuring that each investment leads to sustainable growth and profitability.

5. Logistics (Transportation and Storage)

Logistics involves planning, implementing, and controlling procedures for efficiently moving and storing goods from the point of origin to the point of consumption. This encompasses both transportation – the movement of goods from one location to another – and storage – efficiently storing goods until they're required for sale.

🎯 Its Purpose: The primary purpose of logistics is to ensure that products are available to customers when and where they need them, in the correct quantities, and in good condition. This is critical to maintaining customer satisfaction, reducing cac, and ensuring smooth business operations.

❔ How to implement the Logistics function?

  • Effective planning is crucial, whether it’s planning transportation routes or storage requirements.
  • Inventory management helps to avoid overstock or stockouts and ensures goods are available as per demand. If you use Shopify, you can look at 15 of the Shopify Inventory Management Apps of 2024.
  • Reliability is crucial to prevent delays or damage involving shipping companies or warehousing providers.
  • Logistics software tracks goods in real time and manages inventory.

6. Customer Service

Customer service is about how a company interacts with its customers before, during and after the purchase. It is about meeting customers' needs, addressing their problems, providing information, and ensuring they have a positive and satisfying experience with the company.

🎯 Its Purpose: The main purpose of customer service is to build strong relationships with customers and enhance their experience with the brand. Good customer service helps ensure customer satisfaction, loyalty, and positive word-of-mouth, leading to repeat business and referrals.

❔ How to implement the Customer Service function?

  • Ensure support is easily accessible via phone, email, or live chat.
  • Actively seek, listen, and respond to customer feedback.
  • Develop policies and procedures to resolve customer complaints effectively.
  • Use technology to provide personalized service and recommendations.

For example; Spotify uses its SpotifyCares Twitter account to provide real-time support, address user concerns, and manage service issues quickly and publicly.

An example of "Customer Service", one of the marketing functions, from Spotify.

Making these interactions public increases transparency and builds trust with other customers experiencing similar issues or observing how Spotify handles customer issues.

7. Risk Management

Risk Management, an often underestimated aspect of marketing, is a crucial process that protects a business from uncertainties. It requires identifying, assessing, and prioritizing business risks and uncertainties, then coordinating and applying resources to minimize, monitor and control their impacts.

🎯 Its Purpose: Risk Management’s purpose is to facilitate smooth, uninterrupted business operations by ensuring the strategic elimination of potential risks and vulnerabilities.

❔ How to implement the Risk Management function?

  • Use relevant software and tools to define, identify, and manage potential risks in your venture.
  • Regularly conduct comprehensive risk assessments to expose vulnerabilities and strategize suitable counter measures.
  • Based on your risk assessment, establish a rigorous plan to address the recognized threats.

Why Marketing Functions Should Be Part of Your Strategy

Integrating marketing functions into your overall strategy is not just nice to have; it's a must-have.

Strategic understanding and implementation of each function enable businesses to effectively connect with their target audiences, adapt to market changes, and achieve sustainable growth.

Let's take a look at why each marketing function should be an integral part of your business strategy:

Business meeting scene in an office where marketing functions are discussed.

1. Product Management: Essential for Customer Satisfaction

Product management is at the heart of marketing functions, focusing on product development and customer lifecycles. It involves understanding customer needs and market trends to create products loved by target audiences. Strategic product management enables businesses to be proactive rather than just reactive in their product offerings.

Strategic Importance: Effective product management allows businesses to innovate continually and ensures their products remain competitive and relevant. Companies can increase customer satisfaction and loyalty by aligning product development with customer expectations and market demand.

2. Market Research: Guiding Strategic Decisions

Market research provides the data necessary to make informed decisions; It guides other marketing functions by providing information about consumer behavior, market trends, and competitive analysis.

Strategic Importance: Incorporating market research into your strategy helps you minimize risks associated with new product launches and market entry. It provides a solid foundation for decision-making by ensuring strategies are data-driven and aligned with market realities.

3. Promotion: The Foundation of Creating Brand Identity and Awareness

It covers all activities aimed at communicating with the market, including advertising, sales promotions, public relations, and digital marketing. It's about creating visibility and convincing potential customers to engage with the brand.

Strategic Importance: Strategic promotion increases brand awareness and helps create a brand identity. It attracts and educates potential customers, creating pathways for conversion.

4. Sales and Financing: Makes Customer Acquisition Easier

Sales contribute directly to an organization's profitability. While financing provides the funds necessary to support marketing initiatives, the sales process helps persuade customers to purchase your products or services.

Strategic Importance: Strong sales strategies and flexible financing options can increase conversion rates and market penetration. They help build strong customer relationships necessary for repeat business and word-of-mouth marketing.

5. Logistics: Ensures Product Availability and Operational Efficiency

Logistics deals with the distribution and storage of products and is crucial to ensuring that products reach customers when and where they need them. This includes managing supply chains, transportation, warehousing, and inventory control.

Strategic Importance: Efficient logistics is critical to maintaining customer satisfaction by ensuring on-time deliveries and managing costs effectively.

6. Customer Service: Improves Customer Relationships

Customer service deals with how a company interacts with its customers, leading to customer satisfaction, building trust, and fostering predictability. It develops an emotional connection that leads to repeat purchases and brand loyalty.

Strategic Importance: Customers' needs and complaints guide future strategies, leading to better products and services. This is also critical to retaining customers and increasing customer lifetime value.

7. Risk Management: Protecting the Business

Risk management in marketing involves identifying potential risks to marketing plans, such as budget overruns, changes in market preferences, and supply chain disruptions, and developing strategies to mitigate these risks.

Strategic Importance: Proactive risk management supports stable business operations and protects profits by minimizing the effects of unexpected disruptions.

Benefits of Categorizing Functions of Marketing 

The field of marketing encompasses various functions, each contributing to the success of a business in distinctive ways. 

Therefore, categorizing these marketing functions not only organizes operations but also makes them more efficient in achieving business objectives. Here's a closer look at the benefits of this method:

  • Becoming Experts: When we clearly define our different marketing roles, it allows each team member to become an expert in their area by dedicating their time and effort to understanding it fully.
  • Creating Specialized Strategies: Categorizing our marketing functions gives us a strong foundation for developing targeted, efficient, and adaptable marketing strategies that can meet the unique needs of different customer groups and product lines.
  • Efficient Resource Use: By categorizing our marketing functions, we can better allocate our resources and budget effectively. This allows us to measure the impact and return on investment of our marketing activities easily.
  • Adaptability and Customer Satisfaction: Organizing our marketing functions well makes it easier for us to adapt to changes in the market and customer behavior. This allows us to quickly pivot and make strategic adjustments when needed.
  • Happy Customers and Brand Loyalty: When we categorize and execute our marketing functions efficiently, we can ensure that our products and services meet customer needs, leading to greater customer satisfaction and building brand loyalty.


In our journey through the seven key functions of marketing, we've really explored what makes businesses succeed in a competitive marketplace. 

From carefully gathering and analyzing market research to strategically crafting promotion, product management, pricing, distribution, and sales tactics, we've highlighted the core strategies that drive successful marketing efforts. 

Each function has its unique purpose but works together to create a strategy connecting with consumers and optimizing resources to achieve business objectives. 

By using these functions, businesses can build stronger relationships with their audiences, ensuring that their products and services are noticed and genuinely appreciated for their value and innovation. 

Frequently Asked Questions

1. What are the 7 Ps of Marketing?

The 7 Ps of marketing—Product, Price, Promotion, Place, People, Process, and Physical Evidence—are a broad framework that helps marketers consider different facets of their strategies and tactics. Here are they:

  1. Product: The goods or services a company offers to its customers.
  2. Price: The cost of the product for consumers.
  3. Place: The distribution channels where the product is sold.
  4. Promotion: The marketing strategies used to inform customers about the product.
  5. People: The staff involved in serving customers and running the operation.
  6. Process: Systems and procedures ensuring seamless delivery of the product or service.
  7. Physical Evidence: The tangible aspects of the business that support product or service delivery, especially relevant in service industries.

2. What is the Difference Between the 7 Functions of Marketing and the 7 Ps of Marketing?

The 7 functions of marketing represent the essential roles that marketing plays in a business. These include product management, market research, promotion, selling and financing, logistics, customer service, and risk management. Each function aims to attract and retain customers, guiding a product's journey from production to the customer while generating a profit for the company.

On the other hand, the 7 Ps of marketing, also known as the marketing mix, offer a framework for decision-making in marketing. These Ps include product, price, place, promotion, people, process, and physical evidence. The marketing mix helps businesses make strategic decisions about bringing a product to market and connecting with customers.

In short, the 7 marketing functions show what marketing does in a business, while the 7 Ps provide a framework for successfully implementing those functions.

Further Reading