Chapter 1 - Customer Value (CFD 3033: Intro to Marketing) PDF

CFD 3033: Intro to marketing Chapter 1 CUSTOMER VALUE Dr. Suy Rathny Foundation Department Limkokwing...

CFD 3033: Intro to marketing Chapter 1 CUSTOMER VALUE Dr. Suy Rathny Foundation Department Limkokwing University of Creative Technology [email protected] ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Objectives CFD 3033: Intro to marketing 1) Describe the steps in the marketing process. 2) Examine the different types of products and services. 3) Explore how to market products and services. 4) Create a customer driven strategy. ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Marketing CFD 3033: Intro to marketing Defined: The process by which companies build profitable customer relationships by creating value for customers and capturing value in return Basically: Marketing is about managing profitable customer relationships by: Attracting new customers Retaining and growing current customers ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Marketing CFD 3033: Intro to marketing The Marketing Process Construct a Understand the Capture value marketing marketplace from customers program Design a Build profitable customer-driven relationships strategy ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Sales CFD 3033: Intro to marketing Sales consists of the formal process of closing a sale with a customer in which products and services are exchanged for something of value (usually money).  Marketing uses a variety of methods and media to reach to the customer.  The aim of marketing is educating the customer about a specific product or service.  The aim is to make them aware of the products and services your company provides. ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Understanding the CFD 3033: Intro to marketing Marketplace What IS the “marketplace”? NOT the place you buy things ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Understanding the CFD 3033: Intro to marketing Marketplace Core Concepts: Need &Want Market offerings Customer value & satisfaction Exchanges A Markets ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Understanding the CFD 3033: Intro to marketing Marketplace N-W-D Offerings Value & Satisfaction Exchanges Markets Needs: states of felt deprivation (lacking something) Wants: ‘needs’ shaped by culture and the individual Demands: ‘wants’ that are backed by buying power ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Understanding the CFD 3033: Intro to marketing Marketplace N-W-D Offerings Value & Satisfaction Exchanges Markets Market offerings are some combination of products, services, information, or experiences offered to a market to satisfy a need or want. ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Understanding the CFD 3033: Intro to marketing Marketplace N-W-D Offerings Value & Satisfaction Exchanges Markets Value Customers form expectations regarding value Marketers must deliver value to consumers Satisfaction A satisfied customer will buy again as well as tell others about their experience ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Understanding the CFD 3033: Intro to marketing Marketplace N-W-D Offerings Value & Satisfaction Exchanges Markets The act of obtaining a desired object from someone by offering something in return Relationships with multiple exchanges is the goal Strong relationships built through delivering value and satisfaction ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Understanding the CFD 3033: Intro to marketing Marketplace N-W-D Offerings Value & Satisfaction Exchanges Markets A Market It is a set of actual and potential buyers of a product Marketers seek buyers that are profitable Technology has evolved marketing into an interactive process ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  What is a Product? CFD 3033: Intro to marketing Product: anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or a need Includes the: Services Persons Places Organizations, Ideas ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Classifying Products CFD 3033: Intro to marketing Consumer products Industrial products Additional Products Organizations Persons Places Ideas ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Consumer Products CFD 3033: Intro to marketing  Products and services are bought by final consumers for personal consumption.  Marketers usually classify these products and services further based on how consumers go about buying them.  Consumer products include: convenience products, shopping products, specialty products, and unsought products. ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Consumer Products CFD 3033: Intro to marketing 1) Convenience products  Frequent purchase, inexpensive, immediate consumption, and little search and consideration 2) Shopping products  Less frequent purchase, more expensive, and more search and comparison of products 3) Specialty products  Infrequent (or one-time) purchase, most expensive, and an extensive search effort for specific product 4) Unsought products  The consumer either does not know about or knows about but does not normally think of buying ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Industrial Products CFD 3033: Intro to marketing  Those are purchased for further processing or for use in conducting a business.  There are three groupings of industrial products: materials and parts, capital items, and supplies and services ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Industrial Products CFD 3033: Intro to marketing 1) Materials and parts include raw materials and manufactured materials and parts. 2) Capital items are industrial products that aid in the buyer’s production or operations, including installations and accessory equipment. 3) Supplies and services include operating supplies and maintenance and repair services. ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Additional Products CFD 3033: Intro to marketing  There are good and services that do not fall into the above broad categories.  They are grouped with Organizations, Persons, Places, and Ideas. ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Product & Service CFD 3033: Intro to marketing Decisions Must make decisions about: Attributes Branding Packaging Labeling Support services ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Product & Service CFD 3033: Intro to marketing Decisions Attributes Branding Packaging Labeling Support  Benefits are communicated through attributes: 1) Product quality  The quality level refers to the performance of the product to perform the functions that you have advertised. 2) Product features Competitive tools that you will use to differentiate your product from the competition 3) Product Style and Design Style describes the appearance of the product, the aesthetics of the product; while design affects your product’s usefulness, how was it designed to perform as well as its looks. ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Product & Service CFD 3033: Intro to marketing Decisions Attributes Branding Packaging Labeling Support  A brand is a name, term, sign, symbol, or design that identifies the maker or seller For buyer: Provides connection, consistency of quality For seller: Can offer legal protection Assists in segmentation ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  How well do you know your brands? CFD 3033: Intro to marketing ALL RIGHTS RESERVED. © 2007 Prentice Hall, Inc. All rights reserved. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Product & Service CFD 3033: Intro to marketing Decisions Attributes Branding Packaging Labeling Support Packaging involves designing and producing a container or wrapper for your product. Reduces the risk of damage Increases security Attracts attention Enhances utility ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Product & Service CFD 3033: Intro to marketing Decisions Attributes Branding Packaging Labeling Support  Labelling performs a number of important functions including: Identification of the product. Description of the product. Promotion of the brand. Any legal or copyright statements.  Includes additional info unit pricing open dating nutritional labeling ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Product & Service CFD 3033: Intro to marketing Decisions Attributes Branding Packaging Labeling Support Helps companies learn about their consumers Strengthens customer loyalty Examples: Surveys Warranties & repair ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Product & Service CFD 3033: Intro to marketing Decisions A product line is a group of connected products marketed under a single brand name by the same company. A product mix is the total number of product lines and individual products or services offered by a company. ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Services Marketing CFD 3033: Intro to marketing Service Characteristics Intangibility Inseparability Services cannot be seen, Services cannot be tasted, felt, heard, or smelled separated from their before purchase providers Service Variability Perishability Quality of services depends services cannot be stored for on who provides them and later sale or use when, where, and how ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Services Marketing CFD 3033: Intro to marketing The service-profit chain consists of five links: Internal service quality Satisfied and productive service employees Greater service value Satisfied and loyal customers Healthy service profits and growth ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Market Orientations CFD 3033: Intro to marketing Production Product Selling Marketing Societal concept concept concept concept concept ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Market Orientations CFD 3033: Intro to marketing  Production concept is the idea that consumers will favor products that are available or highly affordable.  Example: Dell’s focus on making the product efficiently  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.  Example: Gillette’s consistent innovation ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Market Orientations CFD 3033: Intro to marketing  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.  Example: Beeline’s large effort in sales promotions  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.  Example: Mercedes-Benz being skilled at target marketing ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Market Orientations CFD 3033: Intro to marketing Societal marketing making good marketing decisions by considering consumers’ wants, the company’s requirements, consumers’ long-term interests, and society’s long-run interests Example: Johnson & Johnson keeping society’s interest a top priority ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Building Customer CFD 3033: Intro to marketing Relationships CRM – Customer Relationship Management The overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction It deals with all parts of: – acquiring, – keeping, and – growing customers ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Building Customer CFD 3033: Intro to marketing Relationships Building Blocks of CRM Customer Value: evaluation of difference between Value benefits and costs Customer Satisfaction: perceived performance Satisfaction relative to expectations Tools: systems to develop stronger bonds CRM Tools (memberships, rewards, package deals) ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Capturing Value CFD 3033: Intro to marketing Key Concepts: Customer Loyalty and Retention Share of customer Customer equity ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Loyalty & Retention CFD 3033: Intro to marketing Customer Lifetime Value – the value of all the purchases a customer would make over a lifetime of patronage Customer delight leads to emotional relationship and loyalty ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Share of Customer CFD 3033: Intro to marketing Share of customer – the portion of the customer’s purchasing in a company’s product category Achieved through offering greater variety & using cross- sell and up-sell strategies ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Customer Equity CFD 3033: Intro to marketing Customer Equity – the combined lifetime values of all current and potential customers Measures a firm’s performance, but looks more to the future Choosing the “best” customers is the key to success ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024  Marketing CFD 3033: Intro to marketing What is it? The process by which companies build profitable customer relationships by creating value for customers and capturing value in return ALL RIGHTS RESERVED. No part of this document may be reproduced without written approval from Limkokwing University of Creative Technology. 2024