CHAPTER 1 Flashcards
What is marketing
“ the process in which companies engage customers,
builds customer relationship and create customer value
in order to capture value from customers return
What are the marketing goals.
- Attract new customers by promising superior value.
- Keep and grow current customers by delivering value and satisfaction.
To provide value you must create something that
- Satisfies customer needs and wants
- Performs well
- Provides benefits that can be clearly communicated
- Priced fairly
- Backed up by the company
what happens when the Marketer engages consumers effectively,
- Understand their needs
- Develops products that provide superior customer value, prices, distributes
- Promotes them well
product will sell easily
How does the new concept of marketing differ from the old concept of marketing?
The old concept of marketing was profit oriented. Producer was more focused on quantity rather than quality.
But new concept of marketing is costumer oriented. Producer now focus on the issues like customer needs, quality, taste of consumer etc
Marketing process
Create value from customers and build customer relationships.
1. Understand the marketplace and customer needs and wants.
2. Design a customer value driven- marketing strategy.
3. Construct an integrated marketing program that delivers superior value
4. Engage customers build profitable relationships and create customer delight.
Capture value from customers in return
5. Capture value from customers to create profits and customer equity
Marketing process
Step1
Understand the marketplace and customer needs and wants
step 1:what are the 5 core customer and marketplace concepts
- Needs, wants and demands
- Market offerings
- Customer value and satisfaction
- Exchanges and relationship
- Markets
Needs
- State of felt deprivation
o Physical needs: food, clothing, warmth and safety
o Social needs: belonging and affection
o Individual needs: knowledge and self expression
wants
- Form taken by human needs when shaped by culture and individual personality
Demands
- When backed by buying power, wants become demands
Market myopia
- Paying more attention to specific products than to the benefits and experiences produced by these products.
Customer value and satisfaction
- Customers form expectations about the value and satisfaction the market offerings will deliver.
o Satisfy customer: buys again and tells others
o Dissatisfied customer: switch to competitors and disparage the profuct to others
expectations
- Low expectations may fail to attract buyers
- Hugh expectations may dissappint buyers
Exchanges and relationship
Exchange: act of obtaining a desired object from someone by offering something in return.
- Marketers goal: bring about a respond to the market offerings
What is a market offering?
The products, services, or experiences offered to the customers in a market to meet their needs are known as market offerings.
- Strong relationshops are built by consistently delivering superior customer value.
Markets
- Set of actual and potential buyers of a product or service
- Sellers search and engage buyers, identify their needs, design good marketing offerings, set prices, promote them, store and deluver.
question to ask about custome relationships
o How can we influence our customers
o How can our customer influence us
o How can our customers influence each other
What is the main problem that sellers suffering from market myopia face.
- They focus more on the products than on the customers underlying needs.
draw/mention the marketing system
suppliers->company and competitors-> marketing intermediaries-> final customers.
final customers goes back to company and competitors and visceversa
Designing a winning marketing strategy (2 questions)
- what is your target market? (what customers)
- what is our value proposition? (how can we best serve them)
Target market
- selecting customers to serve
Market segmentation
- dividing the markets into segments of customers
Target marketing
- refers to selecting which segments to go after
Value proposition
The set of benefits or value the brand promises to deliver consumers to satisfy their needs in a superior way.
Marketing management orientations
It’s a strategic focus on identifying consumers needs and desires in order to define new products developed.
There are five alternative concepts under which organizations design and carry out their marketing strategies: the production, product, selling, marketing, and soci- etal marketing concepts.
- production concept: affordability, production, distribution
- product concept: product quality, continuous product improvements
- selling concept: creating sales with selling and promotion effort
- marketing concept: costumer centered, customer value and relationship.
- social marketing concept: consumers and society’s wellbeing, sustainable marketing.
Selling concept
- factory (starting point)
- existing products (focus)
- selling and promoting (means)
- profits through sales volume (ends)
The marketing concept.
- Market (starting point)
- customer needs (focus)
- integrated marketing (means)
- profits through customer satisfaction (ends)
the social marketing concept
The idea that a company’s market- ing decisions should consider consumers’ wants, the company’s requirements, consumers’ long-run interests, and society’s long-run interests.
draw the social marketing concept
draw the triangle
what should you consider when constructing an integrated marketing system?
- deliver the intended value to target customers
4 Ps of marketing - Major marketing mix tools
1. product
2. price
3. place: distribution
4. promotion
Engaging customer and managing customer relationships (last and most important step of marketing process)
o Customer relationship management: levels and tools
o Customer engagement marketing
o Consumer generated marketing
o Partner relationship management
- Capturing value from customers (engaging customer and managing customer relationship)
o Creating customer loyalty retention
o Growing share of customers
o Building customer equity
o 4 customer relationship groups
Customer relationship management
delivering superior customer value and satisfaction to build and maintain profitable customer relationships.
3 points of customer relationship managament
- Customer perceived value: customers evaluation of all benefits – all the costs of a market offering relative to competing offers
- Customer satisfaction: how does the product match a buyers expectation
- Customer delight: companies aim to delight customers by promising only what they can deliver and then delivering more than they promise.
Levels and tools
Levels:
low margin cystomers: buil basic relationships
High margin customers: create full partnerships
Tools
Frequency marketing programs: eg airlines hotels
Loyalty rewards programs: eg scene with Scotiabank
Club marketing programs
Customer engagement marketing
Makes the brand a meaningful part of customers’ conversations and lives
Successful engagement marketing means making relevant and genuine contributions to targeted consumers lives and interactions
what is
Consumer generated marketing
- Brand exchanges created by consumers
o Consumers play an increasing role in shaping their own brand experiences of other consumers - Uninvited and invited
o Consumers to consumer exchanges
o Consumers invited by companies - Anticipate potential negative consequences
Partner relationship management
Working closely with others both inside and outside the company to jointly engage and bring more value to customers.
- Partners inside the firm: cross functional teams
- Partners outside the firm: suppliers distributors retailers.
HOW TO CAPTURE VALUE FROM CUSTOMERS.
Creating customer loyalty and retention
Growing share of customer
Building customer equity
Customer relationship groups
- Butterflies
- True friends
- Strangers
- Barnacles (loyal customers that rarely make purchases)
