By Peter Cooney

WASHINGTON (Reuters) - Asked again the question on the mind of everyone who follows U.S. politics, Hillary Clinton said on Tuesday she was "thinking" about running for president in 2016.

Appearing at a marketing conference in San Francisco, Clinton, widely considered the Democratic front-runner if she enters the race, was asked by an interviewer: "What's your plan? Are you going to do it? You can announce it here if you'd like."

"I'm actually here trying to get some marketing advice," Clinton quipped, before adding: "I am obviously flattered and deeply honored to have people ask me and people encourage me.

"And I am thinking about it, but I am going to continue to think about it for a while," she said to cheers from the audience.

"Part of it is because the hard questions are not: 'Do you want to be president? Can you win?' The hard questions are why. 'Why would you want to do this and what can you offer that could make a difference?'" Clinton said in a video of the exchange posted on the Internet

The former first lady and U.S. senator, who was defeated by President Barack Obama in the race for the 2008 Democratic presidential nomination, said the United States was experiencing a period of political dysfunction.

"I saw it from afar when I was secretary and it was disheartening and even embarrassing to see people arguing about letting us default on our debt, really, and things that were just so beyond the pale," said Clinton, who served as secretary of state in Obama's first term.

"You had to ask yourself what kind of country do they really want. .. What is their plan? What is their vision? So if you're going to compete in this arena, you have to be able to put forth your purpose and vision."

Clinton, who has been giving speeches across the country since leaving the State Department last year, frequently deflects questions about her presidential ambitions. The former first lady has said she is considering a White House bid, but that she will not make a decision before the end of 2014.

"I'm not going to make a decision for a while because I'm actually enjoying my life," Clinton said on Tuesday. "I'm actually having fun."

(Reporting by Peter Cooney; Editing by Michael Perry)