2004 Ama Definition of Marketing and Grönroos' Alternative Position
This paper summarises and analyses the criticism of the definition of marketing adopted by the American Marketing Association (AMA) in 2004 and the proposition of an alternative definition offered by Grönroos (2006).
Since 1948, the AMA has been responsible for an official definition of marketing used in books, by marketers and in university teaching in the USA. Theirs has historically been perceived as the definition which best represents the discipline (Ferrel & Lucas 1987). The first official definition was adopted in 1935 by a preceding organisation and revised in the mid-1980s, then in 2004 (Keefe 2004) and in 2007 (Lotti & Lehmann 2007).
The 2004 AMA definition of marketing follows (Grönroos 2006):
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.
Grönroos analyses the underpinning logic of the updated definition and reconsiders how well it reflects the challenges for marketing today, focusing on the definition’s specific elements.
Grönroos argues that the ‘phrase delivering value to customers implies that value is embedded in the product ...’. Grönroos asserts that ‘in the supplier’s processes value propositions are developed, whereas real value for customers is created in a customer’s value-creating processes’. This requires that marketing’s role be in developing and communicating value propositions as well as in supporting customer’s value creation.
Grönroos criticises the inclusion of customer relationships management into the definition, for in certain cases non-relational marketing is beneficent.
Grönroos states that marketing cannot be implemented by one organisational function of marketing specialists (p. 405). It requires a customer focus, which must be maintained throughout the organisation.
Grönroos then provides an alternative definition of marketing based on
Since 1948, the AMA has been responsible for an official definition of marketing used in books, by marketers and in university teaching in the USA. Theirs has historically been perceived as the definition which best represents the discipline (Ferrel & Lucas 1987). The first official definition was adopted in 1935 by a preceding organisation and revised in the mid-1980s, then in 2004 (Keefe 2004) and in 2007 (Lotti & Lehmann 2007).
The 2004 AMA definition of marketing follows (Grönroos 2006):
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.
Grönroos analyses the underpinning logic of the updated definition and reconsiders how well it reflects the challenges for marketing today, focusing on the definition’s specific elements.
Grönroos argues that the ‘phrase delivering value to customers implies that value is embedded in the product ...’. Grönroos asserts that ‘in the supplier’s processes value propositions are developed, whereas real value for customers is created in a customer’s value-creating processes’. This requires that marketing’s role be in developing and communicating value propositions as well as in supporting customer’s value creation.
Grönroos criticises the inclusion of customer relationships management into the definition, for in certain cases non-relational marketing is beneficent.
Grönroos states that marketing cannot be implemented by one organisational function of marketing specialists (p. 405). It requires a customer focus, which must be maintained throughout the organisation.
Grönroos then provides an alternative definition of marketing based on
References: Ferrel, OC, Lucas, GH 1987, ‘An Evaluation of Progress in the Development of a Definition of Marketing’, Journal of the Academy of Marketing Science, vol. 15, Fall, pp. 12-23, viewed 26 August 2008, <http://www.springerlink.com/content/bg4g515562881845/fulltext.pdf>. Grönroos, C 2006, ‘On defining marketing: finding a new roadmap for marketing’, Marketing Theory, vol. 6, January, pp. 395-417. Keefe, LM 2004, ‘What is the meaning of “marketing”?’, Marketing News, 28 September, viewed 26 August 2008, <http://market.haloso.net/upfiles/20060527022543.doc>. Levitt, T 1986, ‘After the Sale is Over’, cited in Grönroos, C 2006, ‘On defining marketing: finding a new roadmap for marketing’, Marketing Theory, vol. 6, January, pp. 399. Lotti, M, Lehmann, D 2007, ‘AMA Definition of Marketing’, viewed 27 August 2008, <http://marketingpower.com/Community/ARC/Pages/Additional/Definition/default.aspx>. Vandermerwe, S 1996, ‘Becoming a Customer “Owning” Company’, cited in Grönroos, C 2006, ‘On defining marketing: finding a new roadmap for marketing’, Marketing Theory, vol. 6, January, pp. 399.