Marketplace Concepts PDF

Marketplace Concepts Marketing Stratergy is divided in to five alternative concepts under which organizations design and carry out their marketing strategies. Production Concept Product concept consumers will favor...

Marketplace Concepts Marketing Stratergy is divided in to five alternative concepts under which organizations design and carry out their marketing strategies. Production Concept Product concept consumers will favor consumers will favor products products that are that offer the most in quality, available and performance, and innovative highly affordable features Marketplace Concepts Selling Concept Marketing Concept consumers will not buy enough of the knowing the needs and wants of target firm’s products unless it undertakes a markets and delivering the desired large scale selling and promotion effort satisfactions better than competitors do Marketplace Concepts Societal Marketing Concept Marketing strategy should deliver value to customers in a way that maintains or improves both the consumer’s and society’s well-being Marketing Mix Evolution 4 P’s 4 C’s Marketing Mix Evolution product-centric marketing customer-centric marketing 4 P’s 4 C’s Product Co-creation Price Currency (Dynamic Pricing) Place (Distribution) Communal Activation Promotion Conversation Let’s Compare Aspect 4 P's 4 C's Business-oriented, Customer-oriented, Focus emphasizing what the company offers focusing on what the customer needs Product What the company sells Who the customer is and their needs Price The cost to purchase the product Total cost to the customer (including time, effort, etc.) Place How the product is distributed Convenience of accessing and purchasing the product Promotion How the company communicates with customers Two-way communication and engagement with customers Managing Customer Relationships and Capturing Customer Value Let’s recall stages of marketing process Understanding the marketplace and customer needs Designing a value-driven marketing strategy Constructing a marketing mix Engaging and managing customer relationships. How to build a long- Customer term relationships and websites Relationship Management (CRM) capture customer loyalty? frequency programs Customer Value and Satisfaction Customer-Perceived Value the customer’s evaluation of the difference between the benefits delivered by and the costs of obtaining and using a market offering, relative to those of competing offerings. Ex: Luxury watches like Patek Philippe as symbols of value beyond mere price Customer Satisfaction It depends on the product’s perceived performance relative to a buyer’s expectations. Expectation Performance Expectation Performance Expectation Performance Customer Engagement and Today’s Digital Media Customer Engagement Customer Generated Customer Brand Marketing Marketing Advocacy Direct and continuous Brand exchanges created by customer involvement in Actions by which satisfied customers themselves both shaping brand conversations, customers initiate favorable invited and uninvited by brand experiences, and interactions with others which customers play a role brand community about a brand in shaping their own brand experiences and those of other customers. Attention It might backfire ex: #QantasLuxury definition What Is Customer Equity?  Stew Leonard Customer Loyalty? “Rule #1: The customer is always right. Rule #2: If the customer is ever wrong, reread Rule #1.” What Is Customer Equity? The total combined customer lifetime values of all of the company’s customers. The value of a company comes from the value of its current and future customers. The ultimate aim of customer relationship management is to produce high customer equity. Customer Relationships Groups Strangers show low potential profitability and little projected loyalty. There is little fit between the company’s offerings and their needs. Don’t invest anything in them; try to make money on every transaction. Butterflies are potentially profitable but not loyal just like Butterflies we can enjoy them for a short time and they fly away after getting what they wanted Efforts to convert butterflies into loyal customers are rarely successful True friends are both profitable and loyal. There is a strong fit between their needs and the company’s offerings WE WANT THEM!! Barnacles are highly loyal but not very profitable They are problematic customers :( ex: Smaller bank customers who bank regularly but do not generate enough returns to cover the costs of maintaining their accounts KEY TERMS IOT User Experience SEO Ranking LLM NLP KEY TERMS IOT User Experience SEO Ranking LLM NLP An Expanded Model of the Marketing Process Designing a Customer-Centric Marketing Strategy Develop the Marketing Mix Create a CRM Strategy Product: What unique features or qualities will satisfy Contact Management: How will they keep track of customer customer needs? information and preferences? Price: How will they price their product to balance Customer Service: What approach will they use to resolve customer value and affordability? issues and enhance satisfaction? Place: Where and how will they make the product Customer Engagement & Social Media: How will they use digital available to their target audience? media to build community and encourage customer interaction? Promotion: What methods will they use to reach and Loyalty Programs or Rewards: Will they offer any loyalty programs or persuade customers? incentives? Define Customer Segments and Relationship Strategies You will work in groups to design a customer- classify your hypothetical customers into the four customer relationship centric marketing strategy for a hypothetical groups (Strangers, Butterflies, True Friends, and Barnacles). For each brand, focusing on creating value through segment, you should: the marketing mix (4 Ps / 4Cs ideally), using Describe the characteristics of customers in that segment. CRM tools, and enhancing customer Develop specific strategies for engaging each group effectively relationships. (e.g., prioritize "True Friends" with loyalty rewards, limit resources on "Strangers"). Group Work Company and Marketing Strategy Explain company-wide strategic planning and its four steps Discuss how to design business portfolios and develop growth strategies Describe the elements of a customer value–driven marketing strategy and mix and the forces that influence them Explore the marketing management functions, including the elements of a marketing plan, and discuss the importance of measuring and managing marketing return on investment Strategic planning The process of developing and maintaining a profitable strategic fit between the organization’s goals and capabilities and its changing marketing opportunities. Strategic planning sets the stage for the rest of planning in the firm. Guided by the strategic plan, companies prepare annual and long-range operating plans. The annual and long-range plans deal with the company’s current businesses and how to keep them going. Defining a Market-Oriented Mission What is our business? Who is the customer? Successful companies continually What do consumers value? raise these questions and answer What should our business be? them carefully and completely.  What is a mission market statement ? oriented A mission statement is a statement of the organization’s purpose, what it wants to accomplish in the larger environment. “To solve unsolved problems innovatively.” “To make people happy.” A company’s mission should not be stated as making more sales or profits Profits are ultimately a reward for creating value for customers Instead, the mission should focus on customer and societal benefits the company seeks to create  Designing the Business Portfolio Business Portfolio Portfolio Analysis The collection of businesses The process by which management evaluates and products that make up and plans for the future of the products and the company. businesses that make up the company. Growth-share matrix One of the best-known portfolio-planning methods was developed by the Boston Consulting Group (BCG), a leading A portfolio-planning method that evaluates a manage- ment consulting firm company’s strategic business units (SBUs) in terms of market growth rate and relative market share.  Stars - Stars are high-growth,high-share Cash Cow- low-growth, high-share businesses or products. These businesses or products.They often need established and successful SBUs need less investment to hold their heavy investments to finance their rapid share. They produce a lot of the cash that the company uses to pay its growth. Eventually their growth will slow bills, support other SBUs that need investment, add to cash reserves, or down, and they will turn into cash cows. return to shareholders. market attractiveness Dogs - low-growth, low-share businesses and Question marks - They are low-share business the SBU’s share relative to competitors measure of company strength in the market products. They may generate enough cash to just to units in high-growth markets. They require a lot breakeven, but do not promise to be large sources of of cash to hold their share, let alone increase it. cash. Dogs can represent significant opportunity Management has to think hard about which costs by absorbing managerial energy and attention question marks it should try to build into stars and that could be used more profitably elsewhere. which should be phased out.  Market development Market penetration Company growth by identifying Company growth by increasing and developing new market sales of current products to current segments for current company market segments without changing products. the product Product/Market Expansion Grid Diversification Company growth through starting Strategies Product development up or acquiring businesses outside Company growth by offering the company’s current products and modified or new products to markets. current market segments Market penetration Market Development Expanding store count in existing Expanding into new geographic areas, markets. especially non-U.S. markets. Starbucks plans to reach 55,000 stores Rapid growth in China with an average by 2030 in over 100 markets, a 75% of one new store opening every 15 increase from its current 34,000 stores. hours. This Make it easier for existing customers Reach new customer demographics and to visit, boosting sales without changing expand Starbucks’ presence globally. core products. Diversification Product Development Entering ultra-premium coffee and Launching new and innovative products bakery markets. to current markets. Starbucks Reserve Roasteries and Princi Introduction of ready-to-drink beverages Bakery locations offer a high-end (e.g., Starbucks Cold Brew Concentrate), experience with artisanal Italian baked plant-based options (Oatly oat milk). goods. Capture demand in high-growth Diversify into upscale segments, segments like health-conscious choices broadening Starbucks’ appeal beyond and single-serve beverages. standard coffee shops. Elements of a Customer Value–Driven Marketing Strategy and Mix 1) Market Segmentation 3) Positioning Dividing a market into distinct groups of Arranging for a product to occupy a clear, buyers who have different needs, distinctive, and desirable place relative to characteristics, or behaviors and who might competing products in the minds of target require separate marketing strategies or mixes consumers 2) Market targeting 4) Differentiation Evaluating each market segment’s Differentiating the market offering to attractiveness and selecting one or create superior customer value more segments to serve. relative to the competition. Once the company has chosen a desired positioning, it must deliver and communicate that positioning to target consumers. The com- pany’s entire marketing program should support the chosen positioning. Developing an Integrated Marketing Mix Marketing mix The set of marketing tools; product, price, place, and promotion that the firm blends to produce the response it wants in the target market. Seller’s Perspective Buyer’s Perspective