Chapter 1 Marketing: Creating and Capturing Customer Value PDF

i t ’s good and good for you Chapter 1 Marketing: Creating and Capturing Customer Value Copyright © 2012 Pearson Education, Inc....

i t ’s good and good for you Chapter 1 Marketing: Creating and Capturing Customer Value Copyright © 2012 Pearson Education, Inc. 1- 1 Publishing as Prentice Hall  Creating and Capturing Customer Value Topic Outline 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 Copyright © 2012 Pearson Education, Inc. 1- 2 Publishing as Prentice Hall  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 © 2012 Pearson Education, Inc. 1- 3 Publishing as Prentice Hall  What Is Marketing? The Marketing Process Copyright © 2012 Pearson Education, Inc. 1- 4 Publishing as Prentice Hall  Understanding the Marketplace and Customer Needs Customer Needs, Wants, and Demands States of deprivation Needs Physical—food, clothing, warmth, safety Social—belonging and affection Individual—knowledge and self-expression Wants Form that needs take as they are shaped by culture and individual personality Demands Wants backed by buying power Copyright © 2012 Pearson Education, Inc. 1- 5 Publishing as Prentice Hall  Understanding the Marketplace and Customer Needs Market offerings are some combination of goods, 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 © 2012 Pearson Education, Inc. 1- 6 Publishing as Prentice Hall  Understanding the Marketplace and Customer Needs Customer Value and Satisfaction Expectations Customers Value and satisfaction Marketers Set the right level of expectations Not too high or low Copyright © 2012 Pearson Education, Inc. 1- 7 Publishing as Prentice Hall  Understanding the Marketplace and Customer Needs Exchange is the act of obtaining a desired object from someone by offering something in return Marketing consists of actions taken to build and maintain desirable exchange relationships with target audiences involving a product, service, idea, or other object Copyright © 2012 Pearson Education, Inc. 1- 8 Publishing as Prentice Hall  Understanding the Marketplace and Customer Needs Markets are the set of actual and potential buyers of a product Copyright © 2012 Pearson Education, Inc. 1- 9 Publishing as Prentice Hall  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? Copyright © 2012 Pearson Education, Inc. 1- 10 Publishing as Prentice Hall  Designing a Customer-Driven Marketing Strategy Selecting Customers to Serve Market segmentation refers to dividing the markets into segments of customers Target marketing refers to which segments to go after Copyright © 2012 Pearson Education, Inc. 1- 11 Publishing as Prentice Hall  Designing a Customer-Driven Marketing Strategy Choosing a Value Proposition Value proposition Set of benefits or values a company promises to deliver to customers to satisfy their needs Copyright © 2012 Pearson Education, Inc. 1- 12 Publishing as Prentice Hall  Designing a Customer-Driven Marketing Strategy Marketing Management Orientations What is the philosophy that guides management decisions? Producti Marketin Product Selling Societal on g concept concept concept concept concept Copyright © 2012 Pearson Education, Inc. 1- 13 Publishing as Prentice Hall  Designing a Customer-Driven Marketing Strategy Marketing Management Orientations Production concept is the idea that consumers will favor products that are available or highly affordable Copyright © 2012 Pearson Education, Inc. 1- 14 Publishing as Prentice Hall  Designing a Customer-Driven Marketing Strategy Marketing Management Orientations 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. Copyright © 2012 Pearson Education, Inc. 1- 15 Publishing as Prentice Hall  Designing a Customer-Driven Marketing Strategy Marketing Management Orientations 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 Copyright © 2012 Pearson Education, Inc. 1- 16 Publishing as Prentice Hall  Designing a Customer-Driven Marketing Strategy Marketing Management Orientations 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. Copyright © 2012 Pearson Education, Inc. 1- 17 Publishing as Prentice Hall  Designing a Customer-Driven Marketing Strategy Marketing Management Orientations 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 Copyright © 2012 Pearson Education, Inc. 1- 18 Publishing as Prentice Hall  Designing a Customer-Driven Marketing Strategy Copyright © 2012 Pearson Education, Inc. 1- 19 Publishing as Prentice Hall  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 Copyright © 2012 Pearson Education, Inc. 1- 20 Publishing as Prentice Hall  Building Customer Relationships Customer Relationship Management The overall process of building and (CRM) maintaining profitable customer relationships by delivering superior customer value and satisfaction Copyright © 2012 Pearson Education, Inc. 1- 21 Publishing as Prentice Hall  Customer Relationship Management (CRM) It deals with all aspects of acquiring, engaging, and growing customers. it involves managing detailed information about individual customers and carefully managing customer touchpoints to maximize Copyright © customer 2012 Pearson Education,loyalty. Inc. 1- 22 Publishing as Prentice Hall  Building Customer Relationships Relationship Building Blocks: Customer Value and Satisfaction Customer- Customer perceived value satisfaction The difference The extent to between total which a customer product’s perceived value and total performance customer cost matches a Value = buyer’s Benefits/Price expectations Copyright © 2012 Pearson Education, Inc. 1- 23 Publishing as Prentice Hall  Building Customer Relationships Customer Relationship Levels and Tools Basic Full Partnership Relationshi ps s Copyright © 2012 Pearson Education, Inc. 1- 24 Publishing as Prentice Hall  Building Customer Relationships Basic Relationships used by a company with many low-margin customers. For example, Procter & Gamble does not phone or call on all of its Tide consumers to get to know them personally. Instead, P&G creates relationships through brand-building advertising, sales promotions, and its Tide FabricCare Network Web site (www.Tide.com). Full Partnerships used in markets with few customers and high margins, sellers want to create full partnerships Copyright © 2012 with Pearson Education, Inc. key customers. 1- 25 Prentice Hall Publishing as  Building Customer Relationships 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 by incorporating interactive two-way relationships through blogs, Websites, online communities and social networks Copyright © 2012 Pearson Education, Inc. 1- 26 Publishing as Prentice Hall  Building Customer Relationships The Changing Nature of Customer Relationships Customer-managed relationships Marketing relationships in which customers, empowered by today’s new digital technologies, interact with companies and with each other to shape their relationships with brands. Copyright © 2012 Pearson Education, Inc. 1- 27 Publishing as Prentice Hall  Building 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 Copyright © 2012 Pearson Education, Inc. 1- 28 Publishing as Prentice Hall  Building Customer Relationships Partner Relationship Management 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 Copyright © 2012 Pearson Education, Inc. 1- 29 Publishing as Prentice Hall  Building Customer Relationships Partner Relationship Management Supply chain is a channel that stretches from raw materials to components to final products to final buyers Copyright © 2012 Pearson Education, Inc. 1- 30 Publishing as Prentice Hall  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 © 2012 Pearson Education, Inc. 1- 31 Publishing as Prentice Hall  Customer Lifetime Value Stew Leonard operates a highly profitable 4-store supermarket in Connecticut and New York, – says that he sees $50,000 flying out of his store every time he sees a sulking customer. Why? Because his average customer spends about $100 a week, shops 50 weeks a year, and remains in the area for about 10 years. Copyright © 2012 Pearson Education, Inc. 1- 32 Publishing as Prentice Hall  Capturing Value from Customers Growing Share of Customer Share of customer is the portion of the customer’s purchasing that a company gets in its product categories Copyright © 2012 Pearson Education, Inc. 1- 33 Publishing as Prentice Hall  Capturing Value from Customers Customer equity is the total combined customer lifetime values of all of the company’s customers Copyright © 2012 Pearson Education, Inc. 1- 34 Publishing as Prentice Hall  Capturing Value from Customers 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 © 2012 Pearson Education, Inc. 1- 35 Publishing as Prentice Hall  Capturing Value from Customers Building Customer Equity Building the Right Relationships with the Right Customers FIGURE 1.5 Customer Relationship Groups Copyright © 2012 Pearson Education, Inc. Copyright © 2016 Pearson Education, Inc. 1- 36 1-36 Publishing as Prentice Hall  The Changing Marketing Landscape Uncertain Economic Environment New consumer frugality Marketers focus on value for the customer Copyright © 2012 Pearson Education, Inc. 1- 37 Publishing as Prentice Hall  The Changing Marketing Landscape Digital Age People are connected continuously to people and information worldwide Marketers have great new tools to communicate with customers Internet + mobile communication devices creates environment for online marketing Copyright © 2012 Pearson Education, Inc. 1- 38 Publishing as Prentice Hall  The Changing Marketing Landscape Rapid Globalization Sustainable Marketing Not-for-Profit Marketing Copyright © 2012 Pearson Education, Inc. 1- 39 Publishing as Prentice Hall  So, What Is Marketing? Pulling It All Together Copyright © 2012 Pearson Education, Inc. 1- 40 Publishing as Prentice Hall  All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Copyright © 2012 Pearson Education, Inc. 1- 41 Publishing as Prentice Hall