basic01_ppt.ppt 195KB Sep 05 2010 10:30:38 PM

Chapter One

Marketing: Managing Profitable Customer Relationships

Roadmap:

Previewing the Concepts

1. Define marketing and the marketing process.

2. Explain the importance of understanding customers and identify the five core

marketplace concepts.

3. Identify the elements of a customer-driven marketing strategy and discuss the

marketing management orientations.

4. Discuss customer relationship management and creating value for and capturing value from customers.

5. Describe the major trends and forces changing the marketing landscape.

Creating Value

 _{NASCAR sells the}

experience – in-car cameras, wholesome family orientation.

 _{NASCAR.com engages}

fans via content.

 _{Success has been}

achieved by creating

lasting customer relationships.

NASCAR – What is its secret?

NASCAR – What is its secret?

Case Study

Case Study

Capturing Value

 _{NASCAR is the 2nd}

highest rated sport on TV.

 _{Fans are young, affluent,}

and family oriented, spending nearly $700 annually on NASCAR merchandise.

 _{Fans are loyal to sport}

and NASCAR fans are 3 times as likely to seek out sponsors’ products than

What Is Marketing?

Simple Definition:

Marketing is managing profitable customer relationships.

Goals:

1. Attract new customers by promising superior value.

2. Keep and grow current customers by delivering satisfaction.

Marketing Defined

 _{A social and managerial process by}

which individuals and groups obtain what they need and want through

creating and exchanging products and value with others.

OLD View of Marketing: Making a Sale – “Telling & Selling”

New View of Marketing: Satisfying customer needs NEW View of Marketing: Satisfying Customer Needs

The Marketing Process

 _{A simple model of the marketing process:}

– Understand the marketplace and customer needs and wants.

– _{Design a customer-driven marketing strategy.} – Construct a marketing program that delivers

superior value.

– Build profitable relationships and create customer delight.

– Capture value from customers to create profits and customer quality.

Needs, Wants, & Demands

 _Need:

State of felt deprivation including

physical, social, and individual needs.

– Physical needs:

• Food, clothing, shelter, safety

– Social needs:

• Belonging, affection

Needs, Wants, & Demands

 _Wants:

Form that a human need takes, as shaped by culture and individual personality.

Need / Want Fulfillment

 _{Needs and wants are fulfilled through a}

Marketing Offer:

– Some combination of products, services, information, or experiences offered to a market to satisfy a need

Need / Want Satisfiers

 _Products: – Persons – Places – Organizations – Information – Ideas  _Services

– Activity or benefit offered for sale

that is essentially intangible and

does not result in ownership.

 _{Brand Experiences:}

“. . . dazzle their senses, touch their hearts, stimulate their minds.”

Marketing Myopia

 _{Marketing myopia occurs when sellers}

pay more attention to the specific

products they offer than to the benefits and experiences produced by the

products.

 _{They focus on the “wants” and lose}

Value & Satisfaction

 _{Care must be taken when setting}

expectations:

– If performance is lower than expectations, satisfaction is low.

– _{If performance is higher than expectations,}

Exchange vs. Transaction

 _Exchange:

– _{Act of obtaining}

a desired object from someone by offering

something in return.

 _Transaction:

– _{A trade of}

values between two parties.

– _{One party gives}

X to another

party and gets Y in return. Can include cash,

What Is a Market?

 _{The set of actual and potential buyers}

of a product.

 _{These people share a need or want that}

can be satisfied through exchange relationships.

Modern Marketing Systems

 _{Main elements in a modern marketing}

system include:

– Suppliers

– Company (marketer)

– Competitors

– Marketing intermediaries

Marketing Management

 _{The art and science of choosing target}

markets and building profitable relationships with them.

– _{Requires that consumers and the}

Marketing Management

 _{Designing a winning marketing}

strategy requires answers to the following questions:

1. What customers will we serve?

What is our target market?

2. How can we best serve these

customers?

Segmentation & Target Marketing

 _{Market Segmentation:}

– Divide the market into segments of customers

 _{Target Marketing:}

Marketing Management

 _Demand

Management

– Finding and increasing

demand, also changing or reducing

demand, as in demarketing.

 _Demarketing

– Temporarily or permanently reducing the number of customers or shifting their demand.

Value Proposition

 _{The set of benefits or values a}

company promises to deliver to consumers to satisfy their needs.

– _{Value propositions dictate how firms will}

differentiate and position their brands in the marketplace.

Marketing Management

Philosophies

 _{Production Concept}  _{Product Concept}

 _{Selling Concept}

 _{Marketing Concept}

The Marketing Plan

 _{Transforms the marketing strategy into}

action

 _{Includes the marketing mix and 4 P’s of}

marketing:

– _Product – _Price

– _{Place (Distribution)} – _Promotion

Customer Relationship Management

 _{The overall process of building and}

maintaining profitable customer

relationships by delivering superior customer value and satisfaction.

– _{Acquiring customers} – _{Keeping customers} – _{Growing customers}

Customer Perceived Value

 _{Customer’s evaluation of the difference}

between all of the benefits and all of the costs of a marketing offer relative to those of competing offers.

Customer Satisfaction

 _{Dependent on the product’s perceived}

performance relative to a buyer’s expectations.

– _{Customer satisfaction often leads to}

consumer loyalty.

– Some firms seek to DELIGHT customers by exceeding expectations.

Customer Relationships

 _{Loyalty and retention programs build}

relationships and may feature:

– Financial Benefits

• EX: Frequency marketing programs

– Social Benefits

• _{EX: Club marketing programs}

– _{Structural Ties}

 _{Focus is on relating directly to}

Partner Relationship Marketing

 _{Marketing partners help create customer}

value and assist in building customer relationships.

 _{Partners inside the firm:}

– All employees customer focused

– Teams coordinate efforts toward customers

 _{Partners outside the firm:}

Customer Loyalty & Retention

 _Customer

Lifetime Value

– _{The entire}

stream of

purchases that the customer would make over a lifetime of patronage.

 _{Share of}

Customer

– The share a company gets

of the customers purchasing in

their product categories.

Customer Equity

 _{The combined discounted customer}

lifetime values of all the company’s current and potential customers.

– _{Classify customers by loyalty and}

potential profitability

The New Digital Age

 _{Technology impacts the ways firms bring}

value to their customers.

 _{Greater connectivity means greater access to}

information, faster travel and communication.

 _{The Internet allows anytime, anywhere}

connections between firms and customers.

– “Click-and-mortar” companies

– “Click-only” companies

New Marketing Landscape

 _{Rapid Globalization}

 _{Ethics and Social Responsibility}  _{Not-for-Profit Marketing}

Rest Stop:

Reviewing the Concepts

1. Define marketing and the marketing process.

2. Explain the importance of understanding customers and identify the five core

marketplace concepts.

3. Identify the elements of a customer-driven marketing strategy and discuss the

marketing management orientations.

4. Discuss customer relationship management and creating value for and capturing value from customers.

5. Describe the major trends and forces changing the marketing landscape.

Partner Relationship Marketing



_{Marketing partners help create customer}

value and assist in building customer

relationships.



_{Partners inside the firm:}

– All employees customer focused

– Teams coordinate efforts toward customers



_{Partners outside the firm:}

Prentice Hall, Inc. Copyr ight 2007

1-28

Customer Loyalty & Retention



_Customer

Lifetime Value

–

_{The entire}

stream of

purchases that

the customer

would make

over a lifetime

of patronage.



_{Share of}

Customer

–

The share a

company gets

of the customers

purchasing in

their product

categories.

Customer Equity



_{The combined discounted customer}

lifetime values of all the company’s

current and potential customers.

–

_{Classify customers by loyalty and}

potential profitability

Prentice Hall, Inc. Copyr ight 2007

1-30

The New Digital Age



_{Technology impacts the ways firms bring}

value to their customers.



_{Greater connectivity means greater access to}

information, faster travel and communication.



_{The Internet allows anytime, anywhere}

connections between firms and customers.

– “Click-and-mortar” companies

– “Click-only” companies

New Marketing Landscape



_{Rapid Globalization}



_{Ethics and Social Responsibility}



_{Not-for-Profit Marketing}

Prentice Hall, Inc. Copyright 2007 1-32

Rest Stop:

Reviewing the Concepts

1. Define marketing and the marketing process.

2. Explain the importance of understanding customers and identify the five core

marketplace concepts.

3. Identify the elements of a customer-driven marketing strategy and discuss the

marketing management orientations.

4. Discuss customer relationship management and creating value for and capturing value from customers.

5. Describe the major trends and forces changing the marketing landscape.