The document outlines the key concepts in marketing including understanding customer needs, designing customer-driven marketing strategies, preparing integrated marketing plans, building customer relationships, and capturing value from customers. It discusses the five steps in the marketing process - understanding the marketplace and customer needs, designing a customer-driven marketing strategy, preparing an integrated marketing plan and program, building customer relationships, and capturing value from customers. It also addresses the changing marketing landscape with developments like the digital age, globalization, ethics and social responsibility, and growth of non-profit marketing.

1. Prasad Weerasinghe
MBA(Col),BSc SP, PGdipMkt(SLIM),Adv Dip in Training,Teaching and Assessing UK),
Certified Professional Marketer(Asia),ICMA(Dip in mgt acc),Certified Trainer (UK),Dip
in Eng(Aqui), MSLIM,CPM(AMF).
Creating & Capturing
Customer Value

2. Creating and Capturing Customer Value
• Outline
• Define marketing and outline the steps in the marketing process
• Understanding the Marketplace and customer needs
• Designing a Customer- Driven Marketing Strategy
• Preparing an Integrated Marketing Plan and Program
• Building Customer Relationships
• Capturing Value from Customers
• The Changing Marketing landscape
28/01/2018 PW 2

3. What is Marketing
• Marketing is a process by which companies create value for
customers and build strong customer relationships to capture value
from customers in return
28/01/2018 PW 3

4. Five Step Model Of The Marketing
Process
In the first four steps,
companies work to understand
consumers, create customer
value and build strong customer
relationships. In the final step
reap the rewards of creating
superior customer value.
28/01/2018 PW 4

5. Understanding the Marketplace
and Customer Needs
• Customer Needs, wants and demand
• Market offerings
• Customer Value and satisfaction
• Exchange and relationships
• Markets
28/01/2018 PW 5

6. Understanding the Marketplace
and Customer Needs
Needs
Wants
Demands
Felt deprivation
Physical –food, clothing, warmth and safety
Social – belonging and affection
Individual – Knowledge and self expression
Form human needs take as they are shaped by
culture and individual personal
Eg: Indian in Kolkata needs food but wants a
bowl of rice and fish
When backed by buying power wants become
demands
Eg. At Southwest airline all
senior executives handle
bags,check in passengers
and serve as flight
attendants once a every
quarter.
At P&G, executives from the
CEO down routinely spend
time with consumers in their
homes and other settings.
Jim Stengel – Global
marketing officer “ we all go
out and really spend time
with consumers”
Customer Needs
28/01/2018 PW 6

7. Understanding the Marketplace and
Customer
• Market offerings are some combinations of products, services,
information or experiences offered to a market to satisfy a need or
want.
• Market offerings also include other entities, such as persons, places,
organizations, information's and ideas.
• Marketing Myopia is focussing only on existing wants and losing sight
of underlying consumer needs
Market offerings- products, services and experiences
28/01/2018 PW 7

8. Understanding the Customer
value and market needs
28/01/2018 PW 8

9. Understanding the Marketplace
and Customer Need
• Exchange is the act of obtaining a desired object of from someone by
offering something in return.
• Marketer tries to bring about a response to some market offering.
The response may be more than simply buying or trading products
and services.
• The goal of a marketer is beyond simply attracting new customers and
creating transactions, retain customers and grow their businesses.
• Marketers want to build strong relationship by consistently delivering
superior customer value.
Exchange and relationships
28/01/2018 PW 9

10. • Markets are the set of actual and potential buyers of products and
services. Byers share a particular need or want that can be satisfied
through exchange relationships.
Understanding the Marketplace
and Customer Need
Markets
28/01/2018 PW 10

11. • Sellers must search for buyers,identify their needs, design market
offerings, set prices for them, promote them, store and deliver them.
• Activities such as consumer research, product development,
communications, distribution, pricing and services are core marketing
activities
• Its not only asking “How can we reach our customrs?” but also “How
should our customers reach us” and even “How can our customers
reach each others”.
Continue…
28/01/2018 PW 11

12. Designing Customer Driven
Marketing Strategy
• Marketing management is the are and science of choosing target
markets and building profitable relationships with them
- What customers will we serve( Market segmentation)
- How can we best serve these customers( Target Marketing)
• Marketing managers role is to find, attract, keep, and grow target
customers by creating, delivering and communicating superior
customer value.
28/01/2018 PW 12

13. • Marketing managers know that they cannot
serve all customers in everyway.
• Hence select only those customers which you
can serve well and profitably. E.g. Apple, Vertu
• The company must first decide who it will
serve. It does this by dividing the market into
segments of customers(Market segmentation).
• Select which segments it will go after.( Target
Marketing)
Designing Driven Marketing
Strategy
Selecting Customers to Serve
28/01/2018 PW 13

14. • The company must also decide how it will serve targeted customers –how
it will differentiate and position itself in the marketplace.
• A company’s value proposition is the set of benefits or values it promises to
deliver to customers to satisfy their needs.
E.g. Northwest Airlines punctual, friendly, fun flight
Singapore airlines luxurious, prestigious, special flight
• Value proposition(VP) is the answer to the customer’s question “why
should I buy your product instead of the competitors”?
• VP is how a company will differentiate and position itself in the
marketplace.
• VP is the set of benefits or value the company promises to deliver to
consumers to satisfy their needs
Designing Customer Driven Marketing
Strategy
Choosing a value proposition
28/01/2018 PW 14

15. 28/01/2018 PW 15

16. Designing Customer Driven
Marketing Strategy
28/01/2018 PW 16

17. • Production Concept is the idea that consumers will favour products
that are available or highly affordable.
Designing Customer Driven
Marketing Strategy
Marketing Management Orientation
28/01/2018 PW 17

18. • Product concept is the idea that
consumers will favour products that
offer the most quality, performance
and features. Organization should
therefore devote its energy to
making continuous product
improvements.
Designing Customer Driven
Marketing Strategy
Marketing Management
28/01/2018 PW 18

19. • Selling concept is the idea that
consumers will not buy enough of
the firm’s product unless it
undertakes a large scale selling and
promotion effort.
Marketing Management Orientation
Designing Customer Driven
Marketing Strategy
28/01/2018 PW 19

20. • Marketing concept is the idea that achieving organizational goals
depends on knowing the needs and wants of the large markets and
delivering the desired satisfaction better than competitors do
Marketing Management Orientation
Designing Customer Driven
Marketing Strategy
28/01/2018 PW 20

21. • Societal marketing concept is the idea that a company should make
good marketing decisions by considering consumer’s wants, the
company’s requirement, consumer's long term interest and societal
long-term interests.
Marketing Management Orientation
Designing Customer Driven
Marketing Strategy
28/01/2018 PW 21

22. Preparing an Integrated Marketing
Plan and Program
• The marketing mix is the set of tools (4P) the firm uses to implement
its marketing strategy. It includes product, price. promotion and
place.
• Integrated marketing program is a comprehensive plan that
communicates and delivers the indented value to chosen customers.
28/01/2018 PW 22

23. Building Customer Relationships
• The overall process of building and maintaining profitable customers
relationships by delivering superior customer value and satisfaction.
Customer Relation Management CRM
28/01/2018 PW 23

24. Preparing integrated Marketing
Plan and Program
• An integrated marketing program starts to deliver the intended value
and build customer relationship by transforming the marketing
strategy into action.
• The marketing program consist of the firm’s marketing mix, the set of
marketing tools the firm uses to implement it’s marketing strategy.
• The major tools are called the four Ps of the marketing; product,
price,place and promotion.
• The firm must blend these mix tools into a compressive, integrated
marketing program that communicates and delivers the intended
value to chosen customers.
28/01/2018 PW 24

25. 28/01/2018 PW 25

26. Building Customer Relationships
Relationships Building Blocks: Customer Value and Satisfaction
28/01/2018 PW 26

27. Building Customer Relationships-
Customer Relationship Levels and Tools
28/01/2018 PW 27

28. • Relating with more carefully selected customers uses selective
relationship management to target fewer, more profitable customers.
• Few firms practices mass marketing with standard products for any
customer comes along.
• Marketers build relationship with customers selectively not with
everyone which is called Selective Relationship management.
• Eg Consumer Electronic Retailer “Best Buy”rolled out a new customer
centric strategy that distinguishes between its best customers (called
angels) and less profitable ones (called Demons). They embrace
angels whilst ditching the Demons
Building Customer Relationships-
The Changing Nature of Customer Relationships
28/01/2018 PW 28

29. • Involves working closely with partners in other
company departments and outside the company to
jointly bring greater value to customers.
• Partners inside the company is every function area
interacting with customers
- Electronically
- Cross-functional terms
• Partners outside the company is how marketers
connect with their suppliers channel partners and
competitors by developing partnerships
Building Customer Relationships-
Partner Relationship Management
28/01/2018 PW 29

30. Building Customer Relationships-
Partner Relationship Management
• Supply chain is a channel that stretches from raw materials to
components to final products to final buyers
• Supply management
• Strategic partnership
• Strategic alliances
28/01/2018 PW 30

31. Capturing Value from Customers
• The first four steps in the marketing process involve building
customer relationships by creating and delivering superior customer
value.
• The final step involve capturing value in return in the form of current
and future sales, market shares and profits.
• By creating superior customer value, the firm creates highly satisfied
customers who stay loyal and buy more.
28/01/2018 PW 31

32. Capturing Value from Customers
• Even a slight drop from complete satisfaction can create an enormous
drop in loyalty which result in losing customer.
Customer life value
• The value of the entire stream of purchases that a customer would
make over a life time of patronage
- Assessing customer value make sense that workin to retain and grow customers makes
good economic sense
• The aim of CRM is to create not just customer satisfaction, but customer
delight which results in customer loyalty and brings good company
performance
- How to keep customer coming back……Rule 1. The customer is always right. Rule 2. If the
customer is ever wrong reread rule 1!...Stew Leonard
Creating Customer Loyalty and Retention
28/01/2018 PW 32

33. Capturing Value of Customers
• Beyond simply retaining good customers to capture customer lifetime value,
good customer relationship management can help markets to increase there
Share of customer – the share they get of the customers purchasing in heir
product categories
Eg. Banks want to increase “share of wallets”
Restaurant want to get more “share of stomach”
car companies want to increase “share of garage”
Airlines want greater “share of travel”
• Companies can offer greater variety to current customers or they can create up-
selling or cross- selling in order to market more product and services.
Eg. Amazon.com keep adding new products like music, videos, gifts, toys ect
Growing Share of Customer
28/01/2018 PW 33

34. • It is the combined customer lifetime value of all ot the company’s
current and potential customers.
• The more loyal the firm’s profitable customers, the higher the firm’s
customer equity.
• Customer equity may be the better measure of a firm’s performance
than current sales or market share.
• Companies should manage customer equity carefully and view
customers as assets that need to be managed and maximized.
Capturing Value of Customers
Building a customer equity
28/01/2018 PW 34

35. Changing Marketing Landscape
Major Development
28/01/2018 PW 35

36. • Digital age has provided marketers with exiting new ways to learn
about and track customers and create products and services tailored
to individual customer needs.
• Different modes of communication. One-to-one or mass
communication.
• Digital technology has brought a new wave of communications,
advertising, video sharing tools, cell phones etc
• Rapid increment of internet users in the world
Changing Marketing Landscape
Digital Age
28/01/2018 PW 36

37. Changing the Marketing Landscape
Major Development
• Today almost every company, large or small, is touched in some way
by global competition.
• Managers in countries around the world are increasinghly taking a
global, not just local, view of the company’s industry, competitors and
opportunities.
28/01/2018 PW 37

38. • As the worldwide consumerism and environmentalism movements
mature, today’s marketers are being called on to develop sustainable
marketing practices.
• Corporate ethics and social responsibility have become hot topics for
almost every business.
Changing the Marketing Landscape
More Ethics and Social Responsibility
28/01/2018 PW 38

39. • In the past, marketing has been most widely applied in the for-profit
business sector.
• In recent years also has become a major part of the strategies of
many not-profit organizations.
• Colleges, hospitals, museums, zoos and even religious institutions.
eg: Imran Khan established SKMCH & RC in order to provide state of
the art cancer care. Especially to those poor masses of the region who
could not afford the exorbitant treatment.
Changing the Marketing Landscape
The Growth for Non Profit Marketing
28/01/2018 PW 39

40. THANK YOU
28/01/2018 PW 40