Chapter 1 - Session 2 PDF

CHAPTER 1 - SESSION 2 DEFINITION: - Marketing attracts new customers by promising value and keeping and growing current customers by delivering value and satisfaction. It is understood as a way of satisfying customers' needs. - Process in which companies engage customers, build strong relationshi...

CHAPTER 1 - SESSION 2 DEFINITION: - Marketing attracts new customers by promising value and keeping and growing current customers by delivering value and satisfaction. It is understood as a way of satisfying customers' needs. - Process in which companies engage customers, build strong relationships, and capture value. THE PROCESS AND UNDERSTANDING THE CUSTOMERS: 1. Understand the marketplace and customer needs. a. 5C´s analysis: Customers, competitors, collaborators, context, company b. Human needs: Basic things of survival. c. d. i. Wants: How they are shaped by culture and personality. ii. Demands: Wants that are backed with buying power The customer: i. Consumer: individuals who purchase goods and services ii. Reseller: Buys goods and services to resell iii. Business: Buys goods and services for further processing iv. Government: Agencies that buy goods to produce public services v. International Market: buys in other countries. Why market research? i. Analysis isn't enough: Previous analysis doesn't give sufficient information. ii. Analysis has given a hypothesis you want to investigate: Good understanding —> explore in depth before investing. iii. The business model needs it: Value offering depends on data collection - specific methods of recurring research. 2. Design a customer value strategy. a. Mission, Vision, Values i. b. Mission: Reason of existence. Describes what the organization does 1. Product orientated: Where and how organizations compete 2. Market-oriented: How it creates value, always customer focussed ii. Vision: What are the organization´s aspirations of what they hope to achieve or become iii. Values: Organizational beliefs and how people are expected to behave Creating value i. ii. The who: Select customers to serve 1. Segmentation: Total market into smaller segments 2. Targeting: Select the segment to enter The what: Decide on the value proposition 1. Differentiation: Differentiate the market for creating value 2. Positioning: Position the market offering in the minds of the target. 3. 4. 5. Construct an integrated program that delivers value a. Product: Create a need-satisfying market offering b. Price: Decide how much the offering will cost the customer c. Place: How to approach distribution channels d. Promotion: Engage and persuade customers. Engage customers, build relationships, and create customer relationships. a. Customer perceived value b. Customer expectation Capture value from customers to make profits and equity. ¿How much? a. Lifetime value: Satisfied customer → Loyal customer → spend more → stay with your brand b. Customer equity: Total combined customer lifetime value of all current and potential customers. c. Share of customer: Portion of the customer´s purchasing that a brand gets in its product categories. Butterflies True Friends Barnacles Strangers High profit, low loyalty High profit, high loyalty Low profit, high loyalty Low profit, intense loyalty Despite Samsung's better photos, buying an iPhone Apple loyalists will accept any device from apple Coffee shops still go, but not for buying, but for wifi Buying gum at a random store Market offerings: Combination of things offered to a market to satisfy a need or like. Marketing myopia: Paying more attention to offers than the benefits. CUSTOMER VALUE, EXCHANGES + RELATIONSHIPS AND MARKETS - A way of choosing among markets is telling others about experiences. Markets should set their expectations at a medium level. - Exchange is obtaining a desired object from someone by offering something in return. - Market are potential and actual buyers of a product or service by identifying their needs, setting prices for them, promoting, etc. Managing customer relationships and capturing their value: - Customer relationship management: Building and maintaining relationships by delivering superior customer value and satisfaction. - Customer perceived value: Evaluation of customers about the difference between benefits and costs of competitors. - Customer satisfaction: A product or service matches a buyer's expectations. HOW TO DESIGN A VALUE-DRIVEN STRATEGY 1. Select customers: 2. Choosing a value proposition 3. Management orientation: How to build profitable relationships with customers a. Production concept: Consumers will buy available and affordable products b. Product concept: Consumers will buy products with quality, performance, and innovation. c. Selling concept: Consumers will only buy the product if it has sales and promotion d. Marketing concept: Goals depend on the needs of consumers and are better than competitors. e. Societal marketing concept: Consider wants and consumers/society's long-term- interests. CUSTOMER AND CONSUMER ENGAGEMENT AND GENERATED MARKETING Customer engagement marketing: Making the brand part of the consumers by involving them in communities, conversations, and experiences. Customer brand advocacy: Actions by which satisfied consumers initiate favorable interactions with others about the brand. Consumer-generated marketing: Consumer-driven brand exchanges shaping personal and collective experiences. CAPTURING VALUE FROM CUSTOMERS 1. Creating loyalty and retention: Losing a consumer is losing the economy. A customer's lifetime value is the entire stream of purchases a customer makes over time. 2. A growing share of customers: The portion of the customers purchasing a company gets in its product categories. 3. Building customer equity: The total combined customer lifetime value of all the company's customers. ONLINE, MOBILE, AND SOCIAL MEDIA MARKETING Digital and social media marketing uses marketing tools such as SMS, mobile apps, and ads via devices. - Social media marketing: Provides exciting opportunities to extend engagement and people discussing the brand. - Mobile marketing: This is the ideal way of engaging customers anytime because mobile marketing is the fastest-growing digital platform. - Big Data marketing: They can use big data to gain deep customer insights and personalize and improve customer engagements and service. - AI marketing: This can be used to analyze data and engage customers in real-time to help them through the buying process. FOR PROFIT MARKETING, GLOBALIZATION, AND SUSTAINABILITY. 1. Nonprofit organizations have found the importance of marketing, using it to compete for support and membership, aiming to attract funds and support. 2. In a world of global competition, businesses must adopt a global perspective to effectively navigate markets, rivals, and opportunities across diverse regions and industries. 3. Modern marketers increasingly focus on social responsibility, environmental sustainability, and ethical practices to meet customer expectations and succeed in the long run.