marketing chapter 1 edition(13)

Chapter 1- slide 1Copyright © 2010 Pearson Education, Inc.

Publishing as Prentice Hall

Getting a Marketing Perspective



• Finance- Capital- People

• Management

• Marketing

Components of a Business



• To let people know you exist

• To let them be inform about your product or service

• To make goods and services available when it is needed and where it is need and in the right quantity

• To satisfy customers by delivering on what you promised in your marketing messages

Why is Marketing Important?



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Q: What are the factors

impacting marketing decisions

today?



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Factors Impacting Marketing Today

• Knowledgeable Customer

•Increased buying power

•Intense competition

• Greater variety of goods and services

• Increased information from a variety of sources

• Enhanced shopping convenience



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Factors Impacting Marketing

Today cont’d• New Technologies and platforms- Websites, Internet, intranet, social media, phones ect. can provide companies with powerful new information and sales channel

•Online software can facilitate purchase, training, recruiting

•Companies can collect scientific information about markets, customers, prospects and competitors from a variety of sources and be in a position to make comparisons and decisions



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Today

• Companies can send value- added and incentives eg. Coupons, samples, rebates, cash- back and information to targeted customers

• Companies can customize offerings and services to individual customers



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Today

•Greater distribution channel

•Variety in prices



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Myths Impacting Marketing

• Marketing is selling.

• Marketing is Public relations.

• The best product or service idea will win and be successful.

• You should cut back on your marketing and advertising expenditures in a recession.

• Anyone can be a successful marketer



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Myths of Marketing

Doing any marketing at all, is better than doing nothing.( shooting in the dark)

Great marketing is dreamed up by highly paid executives who make ads and brochures and websites and then let them loose in the marketplace.

Use short copy. People won't read long copy. (NB.People need information not clutter)



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Myths of Marketing

• Marketing should entertain and amuse

•Word-of-mouth marketing is all that a great business needs.

Once your business has a solid customer base, it can cease marketing.

•Repetition of a marketing message is boring.



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Marketing Overview

Marketing is part of all of our lives and touches us in some way every day. To be successful each company that deals with customers on a daily basis must not only be customer-driven, but customer-obsessed. The best way to achieve this objective is to develop a sound marketing function within the organization.



• To build awareness, credibility and trust with your preferred prospect or customer

• To be ‘out there’, networking, writing articles that educate your preferred prospects, being active in social media circles, getting recommendations, testimonials and referrals, delivering what you promised, going above and beyond for your clients.

Purpose of Marketing



– To facilitate the decision-making process of your preferred prospect or customer;

• The process is accomplished by providing valuable educational content so that your prospects have all the information they require to make a good decision when buying the service or product you sell.

Purpose of Marketing cont’d



• Is to lower the risk for your preferred prospect or customer to purchase from your competitor

• Is to make the purchasing decision easy through: availability, trial, specials, brand identification and quality service

Purpose of Marketing cont’d



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Marketing Overview summary

Aside from the most important decisions of a company which are: Vision, mission and objectives , the first marketing strategy question a company needs to ask is, “What consumers will we serve?” This is market segmentation and targeting.

The second marketing strategy question is, “How can we best serve targeted customers?” This is differentiation, branding and positioning.



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Marketing Overview Summary

cont’d

With its marketing strategy decided, the company now constructs a marketing Program-consisting of the four marketing mix elements, the 4 Ps.

Perhaps the most important step in the marketing process involves building value-laden, profitable relationships with target customers.



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The Holistic Marketing Concept

Holistic Marketing

Integrated

Marketing

Relationship

Marketing

Internal

Marketing

Social

Responsibility

Marketing

Ethics

Environment

Legal CommunityCustomers Channels Partners

Communications

Products &

Services

ChannelsMarketing

Dept. Senior

Mgt.

Other

Dept.



Chapter One

Marketing: Creating and Capturing Customer Value



Creating and Capturing Customer Value

• What Is Marketing?

• Understand the Marketplace and Customer Needs

• Designing a Customer-Driven Marketing Strategy

• Preparing an Integrated Marketing Plan and Program

• Building Customer Relationships

• Capturing Value from Customers

• The Changing Marketing Landscape

Topic Outline



What Is Marketing?

Marketing is a process by which companies create value for customers and build strong customer relationships to capture value from customers inreturn



• Marketing is about managing profitable customer relationships

– Attracting new customers

– Retaining and growing current customers

What Is Marketing?



What Is Marketing?The Marketing Process



The ________ is the nation’s twenty-fourth largest advertiser with an annual budget of more than $1 billion.

1. Procter & Gamble Company

2. Boeing Company

3. Levi Strauss & Co.

4. U.S. Government



Answer

• 4. U.S. Government



Understanding the Marketplace and Customer Needs

You must understand:

• Customer needs, wants, and demands

• Market offerings

• Value and satisfaction

• Exchanges and relationships

• Markets

Core Concepts involved



Understanding the Marketplaceand Customer Needs

• States of deprivation

• Physical—food, clothing, warmth, safety

• Social—belonging and affection

• Individual—knowledge and self-expression

Needs

• Form that needs take as they are shaped by culture and individual personalityWants

• Wants backed by buying powerDemands

Customer Needs, Wants, and Demands



Marketing is ___________.

1. the same as advertising and sales

2. not used by small corporations

3. about satisfying customer needs

4. making a profit



Answer!

• 3. about satisfying customer needs



Marketing is ________.

1. part of manufacturing

2. part of the finance department

3. managing customer relationships

4. sales promotion



Answer!

• 3.managing customer relationships



The most basic concept underlying marketing is that of satisfying ________.

1. profits

2. products

3.human needs

4. services



3. HUMAN NEEDS



Understanding the Marketplace

and Customer Needs

• Market offerings are some combination of products, services, information, or experiences offered to a market to satisfy a need or want

• Marketing myopia is focusing only on existing wants and losing sight of underlying consumer needs




and Customer NeedsCustomer Value and Satisfaction

Expectations

Customers

• Value and satisfaction

Marketers

• Set the right level of expectations

• Not too high or low

http://www.zappos.com/

http://www.zappos.com/



Value and Satisfaction

• Perceived Value

– The customers’ evaluation of the difference between benefits and costs.

– Customers often do not judge values and costs accurately or objectively.

• Customer Satisfaction

– Product’s perceived performance relative to customers’ expectations.



Exchange is the act of obtaining a desired object from someone by offering something in return


and Customer Needs




and Customer Needs

Markets are the set of actual and potential buyers of a product



Designing a Customer-Driven

Marketing Strategy

Marketing management is the art and science of choosing target markets and building profitable relationships with them

– What customers will we serve?

– How can we best serve these customers?


Publishing as Prentice Hall1 - 41

Selecting Customers and Creating

Value

• What customers will we serve?

– Marketers select customers that can be served profitably- target market

• How can we serve these customers best?

– By defining a value proposition

– Includes the set of benefits or values a company promises to deliver to consumers in order to satisfy their needs



Designing a Customer-Driven Marketing Strategy

Market segmentation refers to dividing the markets into segments of customers

Target marketing refers to which segments to go after

Selecting Customers to Serve

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http://jitterbug.com/




Demarketing :Efforts aimed at discouraging (not destroying) the demand for a product which (1) a firmcannot supply in large-enough quantities, or (2) does not want to supply in a certain region where the highcosts of distribution or promotion allow only little profit margin.

Common demarketing strategies include higher prices, scaled-down advertising, and product redesign.

Selecting Customers to Serve

http://www.businessdictionary.com/definition/demand.html

http://www.businessdictionary.com/definition/product.html

http://www.investorwords.com/1967/firm.html

http://www.businessdictionary.com/definition/supply.html

http://www.businessdictionary.com/definition/quantity.html

http://www.businessdictionary.com/definition/want.html

http://www.businessdictionary.com/definition/region.html

http://www.businessdictionary.com/definition/high.html

http://www.businessdictionary.com/definition/costs.html

http://www.businessdictionary.com/definition/distribution.html

http://www.businessdictionary.com/definition/promotion.html

http://www.investorwords.com/8807/allow.html

http://www.businessdictionary.com/definition/profit-margin.html

http://www.businessdictionary.com/definition/common.html

http://www.businessdictionary.com/definition/strategy.html

http://www.investorwords.com/9996/include.html

http://www.businessdictionary.com/definition/price.html

http://www.businessdictionary.com/definition/advertising.html




Choosing a Value Proposition

The value proposition is the set of

benefits or values a company promises to

deliver to customers to satisfy their needs

Such value proposition differentiate one

brand from another



Marketing Management orientations

• Marketing Management wants to design strategies that will build profitable relationships with target consumers. But what philosophy should guide these strategies?




Production concept

Product concept

Selling concept

Marketing concept

Societal concept

Marketing Management Orientations




Production concept is the idea that consumers will favor products that are available or highly affordable

Management should focus on improving production and distribution efficiency





Product concept is the idea that consumers will favor products that offer the most quality, performance, and features. Organization should therefore devote its energy to making continuous product improvements.





Selling concept is the idea that consumers will not buy enough of the firm’s products unless it undertakes a large scale selling and promotion effort

This concept is typically practiced with unsought goods-those that buyers do not normally think of buying, such as insurance.






Marketing concept is the

idea that achieving

organizational goals

depends on knowing the

needs and wants of the

target markets and

delivering the desired

satisfactions better than

competitors do





Societal marketing concept

is the idea that a company

should make good marketing

decisions by considering

consumers’ wants, the

company’s requirements,

consumers’ long-term

interests, and society’s long-

run interests



Designing a Customer-Driven

Marketing Strategy



The marketing mix is the set of tools (four Ps) the firm uses to implement its marketing strategy. It includes product, price, promotion, and place.

Integrated marketing program is a comprehensive plan that communicates and delivers the intended value to chosen customers.

Preparing an Integrated Marketing

Plan and Program



Building Customer Relationships

• The overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction

• It the most important concept of modern marketing

• It deals with acquiring, growing and keeping customers.

Customer Relationship Management (CRM)



Building Customer RelationshipsRelationship Building Blocks: Customer Value

and Satisfaction

Customer-perceived value

• The difference between total customer value and total customer cost

Customer satisfaction

• The extent to which a product’s perceived performance matches a buyer’s expectations



Building Customer RelationshipsCustomer Relationship Levels and Tools

Basic Relationships

Full Partnerships




• Relating with more carefully selected customers uses selective relationship management to target fewer, more profitable customers

• Relating more deeply and interactively by incorporating more interactive two way relationships through blogs, Websites, online communities and social networks

The Changing Nature of Customer Relationships



Partner relationship management involves working closely with partners in other company departments and outside the company to jointly bring greater value to customers





• Partners inside the company is every function area interacting with customers

– Electronically

– Cross-functional teams

• Partners outside the company is how marketers connect with their suppliers, channel partners, and competitors by developing partnerships

Partner Relationship Management




• Supply chain is a channel that stretches from raw materials to components to final products to final buyers

• Supply management

• Strategic partners

• Strategic alliances

Partner Relationship Management



Capturing Value from Customers

• Customer lifetime value is the value of the entire stream of purchases that the customer wouldmake over a lifetime of patronage

Creating Customer Loyalty and Retention




Share of customer is the portion of the customer’s purchasing that a company gets in its product categories

Growing Share of Customer



Capturing Value from

Customers

Customer equity is the total combined customer lifetime values of all of the company’s customers




• Building the right relationships with the right customers involves treating customers as assets that need to be managed and maximized

• Different types of customers require different relationship management strategies– Build the right relationship with the right

customers

Building Customer Equity

http://www.coca-cola.com/

http://www.coca-cola.com/



The Changing Marketing Landscape

Digital ageRapid

globalization

Ethics and social

responsibility

Not-for-profit marketing

Major Developments



So, What Is Marketing?

Pulling It All Together



REVISION



Which of the following reflects the

marketing concept?

• A) "The supplier is king."

• B) "Marketing should be viewed as hunting and not gardening."

• C) "This is what I make; won't you please buy it?"

• D) "This is what I want; won't you please make it?"

• E) "Customers need to be told where they want to go."

• Answer: D

• Reflective Thinking

• Skill: Application



Some fast-food restaurants offer tasty and convenient food at

affordable prices, but in doing so they contribute to a national

obesity epidemic and environmental problems. These fast-food

restaurants overlook the ________ philosophy.

• A) marketing concept

• B) product concept

• C) production concept

• D) societal marketing concept

• E) selling concept




Skill: Application

Answer: D



Members of the sales team at Dekko International visit only

prospective customers who purchase a minimum of $50,000 of

insulated wire per year. Dekko is using ________.

• A) selective relationship management

• B) a frequency marketing program

• C) a club marketing program

• D) demarketing

• E) a value proposition




• Application

Answer: A

marketing chapter 1 edition(13)

Education

myths of marketing marketing

pearson education

marketing perspectivechapter

wordofmouth marketing

marketing messages

marketing decisions

darkgreat marketing

prentice hall1