Marketing: Managing Profitable Customer Relationships PDF

Marketing: Managing Profitable Customer Relationships  Objectives Be able to define marketing and discuss its core concepts. Be able to define marketing management and compare the five marketing management orientations. 1-2  Objectives Understa...

Marketing: Managing Profitable Customer Relationships  Objectives Be able to define marketing and discuss its core concepts. Be able to define marketing management and compare the five marketing management orientations. 1-2  Objectives Understand customer relationship management and strategies. Provide exposure to marketing mix variables and some marketing functions 1-3  What is Marketing? Kotler’s social definition: “Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others.” 1-4 What is Marketing? Marketing is managing profitable customer relationships  Attracting new customers  Retaining and growing current customers “Marketing” is NOT synonymous with “sales” or “advertising” 1-5 THE MARKETING PROCESS 1-6  So, What Is Marketing? Pulling It All Together Copyright © 2012 Pearson Education, Inc. 1- 7 Publishing as Prentice Hall Marketing Management Marketing management is “the art and science of choosing target markets and building profitable relationships with them.”  Creating, delivering and communicating superior customer value is key. 1-8 Marketing Management Customer Management:  Marketers select customers that can be served well and profitably. Demand Management:  Marketers must deal with different demand states, ranging from no demand to too much demand. 1-9  Marketing Management Orientations What is the philosophy that guides management decisions? Copyright © 2012 Pearson Education, Inc. 1- 10 Publishing as Prentice Hall Marketing Management Production Management Product Concept Orientations Concept Selling Marketing Concept Concept Societal Marketing Concept 1 - 11 MARKETING ORIENTATIONS PRODUCTION PRODUCT (1910) (1900) Consumers will favour products that Consumers will offer the most favour products that quality, performance are widely available and innovative features and affordable Management should Management should focus on making focus on improving superior products and production and continuous improvements distribution efficiency 1 - 12  MARKETING MYOPIA Marketing myopia is when a company focuses only on its product, failing to meet its customers' needs or look at the larger societal context of its goods or service. Theodore Levitt coined the term in his marketing paper published in Harvard Business Review (HBR) in 1960 Marketing myopia is focusing only on existing wants and losing sight of underlying consumer needs. The marketing orientations of Production Concept, Product Concept, and Selling Concepts suffer from Marketing Myopia as they start with the product instead of starting with a focus on the customers needs, wants and demand. Copyright © 2012 Pearson Education, Inc. 1- 13 Publishing as Prentice Hall MARKETING ORIENTATIONS SELLING (1930) MARKETING (1950) Consumers will Achieving not buy enough organisational goals depends on of an organi- determining the sation’s needs and wants of products unless target markets and the organisation delivering the aggressively desired satisfactions promotes/sells more efficiently than these products competitors do 1 - 14 Selling and Marketing Concepts Contrasted Copyright © 2024, 2021, 2018 Pearson Education, Inc. All Rights Reserved MARKETING ORIENTATIONS SOCIETAL MARKETING CONCEPT Achieving organisational goals depends on determining the needs and wants of target markets and delivering the desired satisfactions more efficiently than competitors in a way that maintains or improves the customer’s and society’s well-being 1 - 16 Considerations Underlying the Societal Marketing Concept 1 - 17 Core Marketing Concepts 1 - 18  CORE MARKETING CONCEPTS NEED WANTS A state of felt The form that a deprivation human need takes as shaped by culture and Eg. Physical needs – individual personality clothing, food, safety OR a desire directed Social needs – to specific objects belonging, affection that might satisfy a Individual needs – need knowledge, self Eg. Hilfiger shirt, KFC, expression Massage Service, Maslows Hierarchy of Oxford University needs Education etc. 1 - 19 MASLOW HIERARCHY OF NEEDS 1 - 20  CORE MARKETING CONCEPTS DEMAND Human wants backed by ability and willingness to pay (buying power) I.e ( I have the money and I am willing to spend it on this item) 1 - 21  CORE MARKETING CONCEPTS MARKETING MARKETING OFFERS OFFERS Some combination More broadly it of products, include: services, Places, persons, information or organisations, ideas experiences and information offered to a market Also referred to as to satisfy a need or non traditional want marketing 1 - 22 What Can Be Marketed? Goods Services Places Ideas Events Persons Properties Organizations Information Experiences What is being marketed in this ad? 1 - 23  CORE MARKETING CONCEPTS PRODUCTS Anything that can be offered to a market for attention, acquisition, use, or consumption and that might satisfy a need or want SERVICES Activities or benefits offered for sale that are essentially intangible and do not result in the ownership of anything. Eg. Air travel, hotel, theatre 1 - 24  CORE MARKETING CONCEPTS CUSTOMER CUSTOMER VALUE SATISFACTION The difference The extent to between the which a products benefit (utility) the perceived customer gains performance from owning and matches a buyers using a product expectation and the cost of Satisfied/Dis- obtaining the satisfied/Delighted product 1 - 25  CORE MARKETING CONCEPTS EXCHANGE RELATIONSHIP The act of obtaining Actions taken to a desired object build and maintain from someone by desirable offering something exchange in return relationships with TRANSACTION valued customers involving a A trade of values product, service, between two parties idea or other Marketing’s unit of object measurement Marketing Networks 1 - 26  CORE MARKETING CONCEPTS MARKETS A set of actual and potential buyers who share a particular need or want that can be satisfied through an exchange or relationship 1 - 27  Understanding the Marketplace and Customer Needs Markets are the set of actual and potential buyers of a product Copyright © 2012 Pearson Education, Inc. 1- 28 Publishing as Prentice Hall A market can be 1. a collection of buyers. 2. A place where goods are bought and sold. Physical or mortar and brick Virtual or online An industry is a collection of sellers 1 - 29 Customer Lifetime Value and Customer Equity Customer Customer equity  Total combined Lifetime Value customer lifetime The stream of values of all income customers generated by a  Measures firm’s single loyal performance, but in a manner that looks customer. to the future 1 - 30  CRM Customer relationship management (also called CRM) is defined as: “the overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction.” 1 - 31  CRM It costs 5 to 10 times MORE to attract a new customer than it does to keep a current customer satisfied. Marketers must be concerned with the lifetime value of the customer. 1 - 32  CRM Customer value and Key Concepts satisfaction  Perceptions are key  Created by meeting/ Attracting, exceeding expectations Loyalty and retention retaining and  Many benefits of loyalty growing  Increases as satisfaction levels increase customers  Delighting consumers should be the goal Growing customer share  Cross-selling 1 - 33  CRM Customer relationship Key Concepts levels and tools  Customer loyalty and Building retention programs relationships  Adding financial benefits and customer  Adding social benefits equity  Adding structural ties 1 - 34  MARKETING MIX A set of controllable tactical marketing tools – product, price, place, and promotion – that the firm blends to produce the response it wants in the target market This is also referred to as the 4Ps Or from the customers standpoint, the 4Cs Customer solution, cost, convenience, communication 1 - 35  MARKETING MIX PRODUCT/CUSTOMER SOLUTION – the goods-and-services combination the company offers to the target market Variety Sizes Quality Design Features Brand name Packaging Services Returns Warranties 1 - 36  MARKETING MIX PRICE/COST – the amount of money the customers have to pay to obtain the product List price Discounts Allowances Payment period Credit terms 1 - 37  MARKETING MIX PLACE/CONVENIENCE – includes company activities to make the product available to target customers Channels Coverage Assortments Locations Logistics – warehouse, inventory, transportation 1 - 38  MARKETING MIX PROMOTION/COMMUNICATION – activities that communicate the merits of the product and persuade target customers to buy it These activities include:  Advertising  Personal selling  Sales promotion  Public relations  Direct marketing 1 - 39 MARKETING MIX – 4Ps 1 - 40  MARKETING FUNCTIONS Marketing Planning Advertising and sales Marketing research promotion Marketing Sales and information/ distribution intelligence Product/Service analysis development Environmental Marketing HR Analysis development Marketing Procurement administration and Negotiations & Stake- support holder relationship management Pricing 1 - 41  WHAT’S NEXT! TUTORIAL: Review concepts – prepare tutorial week 1 questions, case application LECTURE: MARKETING ENVIRONMENT 1 - 42