Week 1 - Creating And Capturing Value

Question 1

Define marketing

Answer 1

the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.

(Managing profitable customer relationships)

Question 2

Two fold goal of marketing

Answer 2

Attract new customer by promising superior value and to keep and grow current customers by delivering satisfaction

Question 3

Explain the 5 step marketing process

Answer 3

Understand the marketplace and customer needs and wants and demands

Design a customer driven market strategy

Construct an intergrated marketing program that delivers superior value

Build profitable relationships and create customer satisfaction

Capture value from customers to create profits and customer equity

Question 4

5 core customer and marketplace concepts

Answer 4

Customer needs and wants and demands
Market offerings: goods services and expierences
Customer value and satisfaction 
Exchanges and relationships 
Markets

Question 5

Define need

Answer 5

States of felt deprivation

(Include physical needs, social needs and indivdual needs)

Markets can not create needs they are part of the basic human makeup

Question 6

Define wants

Answer 6

The form human needs take as shaped by culture and individual personality

-people always have unlimited wants but limited resources thus have to choose products that yield greatest satisfaction for their money

Question 7

Define demands

Answer 7

Human want that are backed by ‘buying power’

Question 8

Define market offering

Answer 8

GOODS SERVICES and EXPIERENCES

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

Question 9

Define products

Answer 9

Anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need

(G+s’s and expierences and a variety of other offerings that satisfy consumers needs and wants)

Question 10

Define market myopia

Answer 10

The mistake of paying more attention to specific products a company offers than to the benefits and expierences produced by these products.

• loose sight of underlying consumer need
  E.g. Manufacture of drill bits may think customer wants a drill but they really need a hole

Creating several series of products and services create ‘brand expierences’

Question 11

Define exchange

Answer 11

The act of obtaining a desired object from someone, by offering them something in return
E.g money, votes, memberships

Question 12

Define transaction

Answer 12

A trade between two parties that involve at least two things of value, agreed upon conditions and a time and place of agreement

Question 13

Define a market

Answer 13

The set of actual and potential buyers of a product or service

Question 14

Define de marketing

Answer 14

Marketing in which the task is to temporarily or permanently reduce demand (smoking, TAC)

Question 15

Types of demand

Answer 15

Negative demand - market dislikes product and may even pay a price to avoid it eg vaccinations

No demand - consumers unaware or uninterested in product

Latent demand - strong need that cannons be satisfied by existing products. Task is to measure size of potential market and develop effective products and services to meet demand

Declining demand -markets task is to reverse decline

Irregular demand- seasonal or even daily can lead to ideal or overworked capacity

Full demand - when they have satisfied volume of business, and attempt to maintain current level of demand

Overfull demand -demand higher than what they can handle
Unwholesome demand - get people who like something to give it up

Question 16

Define value proposition

Answer 16

The full positioning of a brand - the full mix of benefits upon which it is positioned

Competitive advantage

Question 17

What are the five marketing management operations activities/concepts

Answer 17

Production 
Product
 selling
Marketing
Societal

Question 18

Define production concept

Answer 18

The idea that consumers will favour products that are available and highly affordable, the organisation should therefore focus on improving production and distribution efficiency

Lower labour costs
Higher efficiency
Mass production

Question 19

Negatives of production concept

Answer 19

Pc can lead to marketing myopia - companies adopting this orientation run a major risk of focusing too narrowly on their own operations and loosing sight of the real objective - satisfying customers needs and wants

Question 20

Define product concept

Answer 20

The idea that consumers will favour products that offer the greatest quality performance and innovative features - therefore the organisation should devote its energy to making continuous product improvements

Question 21

Negative of product concept

Answer 21

Can also lead to marketing myopia

Focusing to closely on particular products not noticing trends and demographics

Question 22

Define the selling concept

Answer 22

The idea that consumers will not buy enough of the organisations products unless it undertakes a large scale selling and promotion effort
-typically practiced with unsought good that are not normally considered e.g. Insurance & blood donations

Question 23

Negatives of selling concept

Answer 23

Such aggressive sales transactions, focus solely on sales rather than building longterm profitable customer relationships - the aim is often to seek what the company makes rather than what the market wants
Starts with factory focusing on existing products and calls for heavy selling and promotion to obtain profitable sales

Long term pain less returning coustmers

Question 24

Define the marketing concept

Answer 24

The marketing management philosophy states that achieving organisational goals depends on knowing the wants and needs of target markets and delivering the desired satisfaction Moree efficiently than competitors do

Yields profits through creating lasting customer relationships
CUstomer driven companies reach their customer base regularly to learn about their desires and develop new product and service ideas

Works most effectively when customers know exactly what they want
However not many customers know what they want or what is possible additionally there are conflicting desires

Question 25

Define societal marketing concept

Answer 25

The idea that a company’s marketing decisions should consider consumers wants, the company’s requirements, consumes long running interests and society’s long running interests

Ethical and socially responsible
Calls for sustainable marketing

Question 26

Define sustainable marketing

Answer 26

Socially and environmentally responsible marketing that meets the present needs of consumers and businesses while also preserving or enhancing the ability of future generations to meet their needs

Question 27

Marketing concept vs selling concept

Answer 27

Marketing:
Starting point: market 
Focus: customer needs
Means: intergreated marketing
End: profits through customer satisfaction 

Selling 
Starting point: factory
Focus: existing products
Means: selling and promoting 
End: profits through sales volume

Question 28

What are the elements of the marketing mix

Answer 28

Price
Physical evidence 
Product/good/service/expierence
People 
Process
Placement logistics 
Promotion

Question 29

Define customer relationship management

Answer 29

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

Deals with keeping and acquiring new customers

Question 30

Define customer perceived value

Answer 30

The customers evaluation of the difference between all the benefits and all the costs of a marketing offer relative to those of competing offers

Customers act on ‘perceived value’ e.g. Ferrari fastest car on earth..?

Question 31

Define customer satisfaction

Answer 31

The extent to which a products perceived performance matches or exceeds a buyers expectations

Question 32

Define customer managed relationships

Answer 32

Marketing relationships in which customers empowered by modern technology interact with companies and with each other to shape their relationship with brands

Question 33

Greater consumer control means ..

Answer 33

Companies can no longer rely on marketing by intrusion, instead marketers must practice marketing by attraction - creating market offerings and messages that involve consumers rather than interrupt them e.g companies using social media

Question 34

Define Consumer generated marketing

Answer 34

Brand exchanges created by consumers themselves both invited and uninvited by which consumers are playing an increasing role in shaping their own brand expierences and those of other consumers
E.g social media ad campaigns

Question 35

Define partner relationship management

Answer 35

Working closely with partners in other company departments and outside the company to jointly bring greater value to customers

Question 36

Define customer lifetime value

Answer 36

The value of the entire stream of purchases that the customer would make over a lifetime of support

Need to create / maintain customer loyalty and retention

Question 37

Define share of customer

Answer 37

The proportion of the customers purchasing that a company gets in its product categories

To increase share of customers firms can offer a greater variety to current customers or train employees to upmsell in order to market more products to existing customers
E.g amazon sells various goods and services

Question 38

Define customer equity

Answer 38

The total combined customer lifetime values of all of the company’s customers

The ultimate aim of customer relationship management is to produce high customer equity, as it is a measure of the future value of the company’s customer base

Question 39

Building relationships with the right customers

Answer 39

Short term
Butterflies:
Good fit between companies offerings and customers needs high profit potential

Strangers:
Little fit between company’s offerings and customers needs, lowest profit potential

Longterm:
True friends:
Good fit between companies offerings and customers needs, highest profit potential

Barnacles: limited fit between companies offerings and customers needs, low profit potential

Question 40

Factors of the changing marketing landscape

Answer 40

Uncertain world economy

Measuring marketings performance contribution to organisational performance
Growth of non for profit marketing
The digital age
Rapid globalisation
Sustainable marketing

Question 41

Define non for profit marketing

Answer 41

Marketing as practiced by a variety of organisations whose aim is to make surpluses so as to continue their operations but who do not seek to make profits for shareholders

E.g. Salvos attracting members, volunteers and donations