Chapter 1 Marketing: Creating and Capturing Customer Value

Chapter 1 Marketing: Creating and Capturing Customer Value

Chapter 1 Marketing: Creating and Capturing Customer Value Copyright 2012 Pearson Inc. Copyright 2014 by Pearson Education,Education, Inc. All rights reserved

Publishing as Prentice Hall 11- 11 Creating and Capturing Customer Value Topic Outline

What Is Marketing? Understanding 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 Copyright 2014 by Pearson Education, Inc. All rights reserved What Is Marketing? -Marketing is a process by which

companies create value for customers and build strong customer relationships to capture value from customers in return. Copyright 2014 by Pearson Education, Inc. All rights reserved Marketing Process Wants backed by buying power Copyright 2014 by Pearson Education, Inc. All rights reserved Demands

Needs States of deprivation Physicalfood, clothing, warmth, safety Socialbelonging and affection Individualknowledge and self-expression Wants Form that needs take as they are shaped by culture and individual personality Customer Needs, Wants, and Demands

1-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

Copyright 2014 by Pearson Education, Inc. All rights reserved Customers Value and satisfaction Marketers Set the right level of expectations Not too high or low Copyright 2014 by Pearson Education, Inc. All rights reserved

Exchange is the act of obtaining a desired object from someone by offering something in return -Marketing actions try to create, maintain, grow exchange relationships. -Markets are the set of actual and potential buyers of a product Copyright 2012 Pearson Inc. Copyright 2014 by Pearson

Education,Education, Inc. All rights reserved Publishing as Prentice Hall 1- 8 Copyright 2014 by Pearson Education, Inc. All rights reserved 2-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? Market segmentation refers to dividing the markets into segments of customers Target marketing refers to which segments to go after Copyright 2012 Pearson Inc. Copyright 2014 by Pearson Education,Education, Inc. All rights reserved

Publishing as Prentice Hall 1- 10 Designing a Customer-Driven Marketing Strategy Choosing a Value Proposition A brands Value Proposition is the set of benefits or values a company promises to deliver to customers to satisfy their needs Copyright 2014 by Pearson Education, Inc. All rights reserved

Designing a Customer-Driven Marketing Strategy Marketing Management Orientations Production concept Product concept Copyright 2014 by Pearson Education, Inc. All rights reserved Selling

concept Marketing concept Societal concept Marketing Management Orientations a)Production concept: Consumers will favor products that are available and highly affordable b)Product concept:

Consumers favor products that offer the most quality, performance, and features Focus is on continuous product improvements Copyright 2014 by Pearson Education, Inc. All rights reserved Marketing Management Orientations c)Selling concept: Consumers will not buy enough of the firms products unless it undertakes a large scale selling and promotion effort d)Marketing concept: Knowing the needs and wants of the target markets and delivering the desired

satisfactions better than competitors do Copyright 2014 by Pearson Education, Inc. All rights reserved Marketing Management Orientations e)Societal marketing: Make good marketing decisions by considering: consumers wants and long-term interests, companys requirements, societys long-run interests Copyright 2014 by Pearson Education, Inc. All rights reserved

Designing a Customer-Driven Marketing Strategy Copyright 2014 by Pearson Education, Inc. All rights reserved 3-Preparing an Integrated Marketing Plan and Program The marketing mix: set of tools (four Ps) the firm uses to implement its marketing strategy. It includes product, price, promotion, and place. Integrated marketing program: comprehensive plan that communicates and delivers the

intended value to chosen customers. Copyright 2012 Pearson Inc. Copyright 2014 by Pearson Education,Education, Inc. All rights reserved Publishing as Prentice Hall

1- 17 4-Building Customer Relationships Customer Relationship Management (CRM) The overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction Copyright 2014 by Pearson Education, Inc. All rights reserved

Relationship Building Blocks: Customer Value and Satisfaction Customerperceived value Customer satisfaction The difference between total customer value and total customer cost The extent to

which a products perceived performance matches a buyers expectations Copyright 2014 by Pearson Education, Inc. All rights reserved Building Customer Relationships Customer Relationship Levels and Tools Basic

Relationships Full Partnerships Copyright 2014 by Pearson Education, Inc. All rights reserved The Changing Nature of Customer Relationships 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 Copyright 2014 by Pearson Education, Inc. All rights reserved The Changing Nature of Customer Relationships -Customer-managed relationships Customers, empowered by todays new digital technologies, interact with companies and each other to shape their relationships with brands. -Partner relationship management involves working closely with partners

in other company departments and outside the company to jointly bring greater value to customers Copyright 2014 by Pearson Education, Inc. All rights reserved Partner Relationship Management Partners inside the company is every functional area interacting with customers Electronically Cross-functional teams - Marketers connect with their suppliers, channel partners, and competitors by developing partnerships

-Supply chain is a channel that stretches from raw materials to components to final products to final buyers Copyright 2014 by Pearson Education, Inc. All rights reserved 5-Capturing Value from Customers Creating Customer Loyalty and Retention Customer lifetime value is the value of the entire stream of purchases that the customer would make over a lifetime of patronage

Copyright 2014 by Pearson Education, Inc. All rights reserved Growing Share of Customer Share of customer is the portion of the customers purchasing that a company gets in its product categories Customer equity is the total combined customer lifetime values of all of the companys customers Copyright 2014 by Pearson Education, Inc. All rights reserved

Building Customer Equity 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 Copyright 2014 by Pearson Education, Inc. All rights reserved The Changing Marketing Landscape Changing Economic Environment New consumer frugality

Marketers focus on value for the customer Copyright 2014 by Pearson Education, Inc. All rights reserved The Changing Marketing Landscape Digital Age Online marketing is the fastest-growing Click- and- mortar companies evolved Copyright 2014 by Pearson Education, Inc. All rights reserved The Changing Marketing Landscape

Not-for-profit marketing growth Rapid Globalization Sustainable marketing Copyright 2014 by Pearson Education, Inc. All rights reserved So, What Is Marketing? Pulling It All Together Copyright 2012 Pearson Inc.

Copyright 2014 by Pearson Education,Education, Inc. All rights reserved Publishing as Prentice Hall 1- 30

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