MARMAN CHAPTER 1  Individual: knowledge and self

expression
MARKETING: CREATING AND
CAPTURING CUSTOMER VALUE DEMANDS

MARKETING  Human wants backed by buying

power
 Marketing is managing profitable
customer relationships.
 Attract new customers by promising Market offerings are some combination of
superior value. products, services, information, or experiences
 Keep and grow current customers by offered to a market to satisfy a need or a want.
delivering satisfaction.
Market myopia is focusing only on existing
MARKETING DEFINED wants and losing sight of underlying consumer
needs.
 Broadly defined, marketing is a social
and managerial process by which CUSTOMER VALUE AND SATISFACION
individuals and organizations obtain EXPECTATIONS
what they need and want through
1. Customers
creating and exchanging value with
 From expectations about the value
others.
and satisfaction that various market
 We define marketing as a process by
offerings will deliver and buy
which companies create value for
accordingly.
customers and build strong customer
2. Marketers
relationships to capture value from
 Set the right level of expectations
customers in return.
 Not too high or low
MARKETING PROCESS
EXCHANGES AND RELATIONSHIPS
1. Understand the marketplace and
Exchange is the act of obtaining a desired object
customer needs and wants
from someone by offering something in return
2. Design customer-driven marketing
strategy Relationship marketing actions try to create,
3. Construct an integrated maketing maintain, grow, exchange relationships.
program that delivers superior value
4. Build profitable relationships and create Markets are the set of actual and potential
customer delights buyers of a product.
5. Capture value from customers to create
profits and customer equity

CUSTOMER NEEDS, WANTS AND

DEMANDS

Needs—states of felt deprivation

 Physical: food, clothing, warmth, safety

 Social: belonging and affection
Marketing management is the art and science PREPARING AN INTEGRATED
of choosing target markets and building MARKETIN PLAN AND PROGRAM
profitable relationships with them.
The marketing mix is the set of tools (four
Ps) the firm uses to implement its marketing
strategy. It includes product, price,
promotion, and place.
The firm must blend each marketing mix
tool into a comprehensive integrated
marketing program that communicates and
delivers the intended value to chosen
customers.
SELECTING CUSTOMERS TO SERVE BUILDING CUSTOMER
Market segmentation refers to dividing the RELATIONSHIPS
markets into segments of customers. Customer Relationship Management
Target marketing refers to which segments to In this broader sense, customer
go after.
relationship management is the overall
CHOOSING A VALUE PROPOSITION process of building and maintaining
profitable customer relationships by
A brands value proposition is the set of benefits
values it promises to deliver to consumers to delivering superior customer value and
satisfy their needs. satisfaction.

MARKETING MANAGEMENT Relationship Building Blocks:

ORIENTATIONS Customer Value and Satisfaction a
 The Production Concepts customer buys from the firm that offers the
 The Product Concept highest customer-perceived value—the
 The Selling Concept customer’s evaluation of the difference
 The Marketing Concept between all the benefits and all the costs of a
 The Societal Marketing Concept market offering relative to those of
 The Societal Marketing Concept competing offers.

The Societal Marketing concept holds that Customer satisfaction depends on the
marketing strategy should deliver value to product’s perceived performance relative to
customers in a way that maintains or a buyer’s expectations. If the product’s
improves both the consumer’s and society’s performance falls short of expectations, the
well-being. customer is dissatisfied.
  A growing part of the new customer
dialogue is consumer-generated
Customer Relationship Levels and
marketing, by which consumers
Tools themselves are playing a bigger role
in shaping their own brand
 Companies can build customer
experiences and those of others.
relationships at many levels,
depending on the nature of the target Partner relationship management
market.
In addition to being good at customer
 Many companies offer frequency
relationship management, marketers
marketing programs that reward
must also be good at partner
customers who buy frequently or in
relationship management—working
large amounts.
closely with others inside and
 Other companies sponsor club
outside the company to jointly bring
marketing programs that offer
more value to customers.
members special benefits and create
member.
In today’s more connected world,
Today’s companies are building deeper, every functional area in the
more direct, and lasting relationships with organization can interact with
more carefully selected customers. customers. The new thinking is that
—no matter what your job is in
Today, most marketers realize that they
company—you must understand
don’t want relationships with every
marketing and be customer focused.
customers. Instead, they target fewer, more
profitable customers.
 The supply chain describes a longer
Relating More Deeply and Interactively channel, stretching from raw
materials to components to final
 Relating more deeply and
products that are carried to final
interactively by incorporating more
buyers.
interactive two way relationships
 Through supply chain management,
through blogs, websites, online
companies today are strengthening
communities and social networks
their connections with partners all
 Today’s consumers have more
along the supply chain.
information about brands than ever
before, and they have a wealth of Capturing Value from Customers
platforms for airing and sharing their
The final step involves capturing
brand views with other consumers.
value in return in the form of sales,
Thus, the marketing world is now
market share, and profits. By
embracing not only customer
creating superior customer value, the
relationship management, but also
firm creates highly satisfied
customermanaged relationships.
 customers who stay loyal and buy
more. This, in return, means greater
long-run returns for the firm.
Creating Customer Loyalty and
Retention
 Customer lifetime value is
the value of the entire stream
of purchases that the
customer would make over a
lifetime of patronage
Growing Share of Customer
 Beyond simply retaining
good customers to capture
customer lifetime value, good
The Changing Economic Environment
customer relationship
management can help  The Great Recession caused many
marketers increase their share consumers to rethink their spending
of customer—the share they priorities and cut back on their
get of the customer’s buying.
purchasing in their product  In adjusting to the new economy,
categories. companies and slash prices in an
effort to coax more frugal customers
Building Customer Equity
into opening their wallets.
 Customer equity is the total  The challenge is to balance the
combined customer lifetime brand’s value proposition with the
values of all of the current times while also enhancing
company’s current and its long-term equity.
potential customers.
The Digital Age
Building the Right Relationships with the
 The digital age has provided
Right Customers
marketers with exciting new ways to
 Right relationships with the learn about and track customers and
right customers involves create products and services tailored
treating customers as assets to individual customer needs.
that need to be managed and  Online marketing is now the fastest-
maximized. growing form of marketing.
 Different types of customers
The Growth of Not-for-profit Marketing
require different relationship
management strategies.
  In recent years, marketing has also
become a major part of the strategies
of many not-for-profit organizations,
such as colleges, hospitals,
museums, zoos, symphony
orchestras, and even churches.
 Government agencies have also
shown an increased interest in
marketing.
Rapid Globalization
 Today, almost every company, large
or small, is touched in some way by
global competition.
 Managers in countries around the
world are increasingly taking a
global, not just local, view of the
company’s industry, competitors, and
opportunities.
Sustainable Marketing ─ The Call for
More Social Responsibility
 As the worldwide consumerism and
environmentalismmovements
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.