The art and science of choosing target markets
and building profitable relationship with them.
The marketing manager’s aim is to find, keep
and grow target customers by creating,
delivering and communicating superior
Marketing management gives answer to two
(1) What customers will be served (target
(2) How can these customers will be best served
A company’s value proposition is the set of benefits
or values it promises to deliver to customers to
satisfy their needs.
Value proposition differentiates one brand from
another. They answer the question “Why should I
buy your brand rather than a competitor’s?
Companies must design strong value propositions
that give them the greatest advantages in their
Customer Relationship Management (CRM)
The overall process of building and
maintaining profitable customer
relationships by delivering superior
customer value and satisfaction.
It is the most important concept of modern
Customer Relationship Management
Earlier it was narrowly defined as a customer data
Now it has a broader meaning and it deals with all
aspects of acquiring, keeping and growing
According to Drucker, building customer
relationships, which involve a series of interactions
between individuals and a company over time, will
produce more sales and profits than will focusing
on sales transactions alone.
Customer Perceived Value
The difference between total customer value and
total customer cost.
The customer's perceived expenses that would be
incurred in acquiring and using a product.
The extent to which a product’s perceived
performance matches a buyer’s expectations.
If performance matches expectations, the customer
is satisfied and if performance exceeds
expectations, the customer is delighted.
Customer Lifetime Value
The value of the entire stream of purchases the a
customer would make over a lifetime of patronage.
The total combined customer lifetime values of all
of the company’s customers.
The more loyal the firm’s profitable customers, the
higher the firm’s customer equity.
Customer equity may be a better measure of a
firm’s performance than current sales or market
Sales and market share reflect the past, customer
equity suggests the future.
Example: Cadillac Vs BMW
The Marketing Process
The process by which companies create value
for customers and build strong customer
relationships in order to capture value from
customers in return.
A Simple Model of Marketing Process
Construct an integrated Build profitable relationship Capture value from
marketing program and create customer customers to create
that delivers superior delight profits and customers
ies work to understand customers.
fourth step companies
value and build strong customer
ies reap the rewards of creating
. By creating value for customers
ue from customers in the form of
rm customer equity.