1. marketing in a changing world creating customer value and satisfactionPresentation Transcript
Chapter 1 (Plus Section of Chapter 2) Marketing in a Changing World: Creating Customer Value and Satisfaction
What is Marketing? (pp. 5-6)
The process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others. (p. 6)
Marketing is the delivery of customer satisfaction at a profit. (p. 5)
Marketing Strategy Marketing Mix “ The 4 Ps,” Tactical Tools (“The 4 Cs”) (Fig. 2.6, pp. 67-68) Target Customers Intended Positioning Product (Customer Solution) Goods-and-service combination that a company offers a target market Price (Customer Cost) Amount of money that consumers have to pay to obtain the product Activities that persuade target customers to buy the product Promotion (Communication) Company activities that make the product available Place (Convenience) Advertising Personal Selling Sales Promotion Public Relations
Core Marketing Concepts (Fig. 1.1, pp. 6-13) Needs, wants, and demands Products and services Value, satisfaction, and quality Exchange, transactions, and relationships Markets
Needs - state of felt deprivation for basic items such as food and clothing, and complex needs such as for belonging. (i.e. I am hungry.)
Wants - form that a human need takes as shaped by culture and individual personality. (i.e. I want a hamburger, French fries, and a soft drink.)
Demands - human wants backed by buying power . (i.e. I have money to buy this meal.)
What are Consumer’s Needs, Wants and Demands? (pp. 6-7)
What Will Satisfy Consumer’s Needs and Wants? (pp. 7-8)
Caution: Avoid “Marketing Myopia” (pp. 8, 18)
Products Anything that can be offered to a market to satisfy a need or want Services Activities or benefits offered for sale that are essentially intangible and don’t result in the ownership of anything Experiences Persons Places Organizations Ideas Information
How Do Consumers Choose Choose Among Products & Services? (pp. 9-11)
Customer Value – Value gained from owning a product less the costs
Customer Satisfaction – Perceived performance in providing value, relative to expectations
Quality – Total quality management (TQM) -continuous improvement
Caution: Avoid “Marketing Myopia”
(pp. 8, 18)
How Do Consumers Obtain Products and Services? (p. 11) Transactions Exchanges The core concept of marketing Relationships Building a marketing network with supporting stakeholders (p. 14) Relationship Marketing & Customer Lifetime Value
Who Purchases Products and Services? (pp. 12-13) Market Actual and potential buyers who share a particular need or want that can be satisfied through an exchange or relationship. Needs or wants Resources to exchange Willingness to exchange Actual buyers Potential buyers
Connections With Customers (p. 14)
Most marketers are targeting fewer, potentially more profitable customers.
What value does the customer bring to the organization?
Are they worth pursuing?
Focus has shifted to:
keeping current customers, and
building lasting relationships based on superior satisfaction and value.
Marketing Management (p. 14) Marketing Management Implementing programs to create exchanges with target buyers to achieve organizational goals Demand Management Finding and increasing demand, also changing or reducing demand such as in “ Demarketing” Profitable Customer Relationships Attracting new customers and retaining and building relationships with current customers
Marketing Management Philosophies (pp. 15-22) Based on different assumptions about: - what customers want - what marketers should do Production Concept Product Concept Selling Concept Marketing Concept Societal Mktg. Concept
Consumers favor products that are
available and highly affordable.
Consumers favor products that offer
the most quality, performance, and
Consumers will buy products only if
the company aggressively promotes/
sells these products.
Focuses on needs & wants of target
markets & delivering satisfaction
better than competitors.
Focuses on needs & wants of target
markets & maintaining or improving
societal and customer well-being.
Production Concept Late 1800s & Early 1900s Demand > Supply; High Costs (Still appropriate under these limited circumstances)
Management’s Focus: “engineer”
Improving production efficiency
Improving distribution efficiency
Fails to recognize customer needs/wants
Product Concept Late 1940s (Post World War II) Demand < Supply
Management’s Focus: “inventor”
Make superior products (“build a better mousetrap”)
Make continuous improvements
Danger: “Marketing Myopia”
Focus on physical products , not customer needs & wants
“ Fall in love” with the product , not the customer
Customers don’t need or want (“just don’t care”)
New technology replaces
Selling Concept Late 1940s (Post World War II) Demand < Supply
Not buying or not buying enough
Management’s Focus: “hard-sell salesman”
Large-scale selling and promotion efforts
Coaxing & pushing people to buy
Danger: “Sell what you can make”
(versus “Make what you can sell”)
Marketing Concept 1950s – Present Demand < Supply
Products that satisfy their needs and wants
Management’s Focus: “customer oriented”
Understanding the needs and wants of consumers
Satisfying them more efficiently and more effectively than competitors
(NOTE: Efficiency & effectiveness - keeps the best of the production & product concepts)
(Focuses on the underlying and latent needs as well as the stated needs)
Marketing and Sales Concepts Contrasted (Fig. 1.4, pp. 18-20) The Marketing Concept (“outside-in”) Factory Existing Products Selling and Promoting Profits through Volume The Selling Concept (“inside-out”) Starting Point Focus Means Ends Market Customer Needs Integrated Marketing Profits through Satisfaction
Societal Marketing Concept Late 20 th Century – Still emerging Recognizes potential conflict (pp. 20-22) Societal Marketing Concept Company (Profits) Consumers (Short-term wants) Society (Societal & customer well-being) Maintain & improve long-term well-being Social responsibility Ethics Environment Do good Stop doing bad
Chapter Review (pp. 36-37)
Define what marketing is and discuss its core concepts.
Explain the relationships between customer value, satisfaction, and quality.
Define marketing management and examine how marketers manage demand and build profitable customer relationships.
Compare the five marketing management philosophies.