Marketing First Exam Notes Chapters 1 3 Chapter 1 Marketing Building and Managing profitable customer relationships The two goals of marketing are to attract new customers by providing superior value and to keep and grow current customers by delivering satisfaction Ex Walmart delivering on Save money Live better Marketers want you to live their brands New technology allows marketing to go to you personally through social networks apps etc Peter Drucker the aim of marketing is to make selling unnecessary 5 step model of marketing process o Understand the marketplace and the customers needs and wants o Design a customer driven marketing strategy o Construct an integrated marketing program that delivers superior value o Build profitable relationships and create customer delight o Capture value from customers to create profits and customer equity 5 core customer and marketplace concepts o Needs wants demands o Market offerings products services experiences o Value and satisfaction o Exchanges and Relationships o Markets Customer Needs human needs are states of felt deprivation include physical needs for food clothing warmth and safety Customer Wants shaped by culture and individual personality Customer Demands human wants that are backed by buying power Consumer needs and wants are fulfilled through Marketing Offerings which are some combination of products services information or experiences offered to a market Marketing Myopia the mistake of paying more attention to specific products a company offers than the benefits and experiences produced by these products Customer Value and Satisfaction customer value and satisfaction are key building blocks for developing and managing customer relationships o Satisfied vs Very Satisfied Big difference o Repeat customers are most profitable o Marketers set expectations not too high not too low Exchange the act of obtaining a desired object from someone by offering something in return relationships o Marketing consists of trying to maintain and grow these exchange Markets the set of all actual and potential buyers of a product or service o Sellers must search for buyers identify their needs design good market offerings set prices deliver Important Marketing Activities o Consumer research Product development Communication Distribution Pricing and Service Marketing Management the art and science of choosing target markets and building profitable relationships with them o To design winning Market Strategy the marketing manager must answer two questions What customers will we serve target market How can we serve these customers best value proposition Market Segmentation companies use this to divide customers into segments and deciding which segment to go after target market o Often companies use demographic sex race age etc Value proposition the brands set of values and benefits it promises to deliver its customers not the competitor o Answers the customers question of Why should I buy your brand and 5 Alternative concepts companies use to carry out marketing strategy o the production product selling marketing and societal marketing concepts Production Concept the idea that consumers will products that are available and highly affordable therefore the organization should focus on improving production and distribution efficiency Product Concept the idea that consumers will favor the products with the most quality performance and features therefore the company should devote its time to making continuous product improvements Selling Concept the idea that consumers will not buy enough of the firms products unless the firm undertakes a huge selling and promotion effort o Often used with unsought goods blood donations insurance Marketing Concept a philosophy in which achieving obtainable goals depends on knowing the needs and wants of the target markets and delivering the desired satisfactions better than the competitors o Don t find right customers for your product find the right products for your customers o Herb Kelleher founder Southwest Airlines we don t have a marketing department we have a customer department Societal Marketing Concept the idea that a companies marketing decisions should consider consumers wants the company s requirements consumers long run interests and society s long run interests o Should improve consumer and society s well being o Companies should balance 3 considerations in marketing strategy Company profits Consumer wants and Society s interests Marketing Program the marketing program puts the marketing strategy into action it consists of the companies marketing mix or the Four P s Product Price Place and Promotion Customer Relationship Management most important the overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction Customer Perceived Value the customers evaluation of the difference between all the benefits and all the costs of a marketing offer relative to those of competing offers Customer Satisfaction the extent to which a products perceived performance matches a buyers expectations o Expectations not met unsatisfied Expectations met satisfied Expectations exceeded very satisfied or delighted o Smart companies promise only what they can deliver and than deliver more than they promised Marketing tools besides value and satisfaction companies can use other tools to develop stronger bonds with customers o Frequency marketing programs rewards customers who buy frequently or in large amounts o Club marketing programs offer members special benefits and create member communities o Many companies use Customer Profitability Analysis to weed out losing customers and target and pamper winning ones Interactive Customer Relationships using technology to create deeper customer involvement and a sense of community surrounding a brand o Its allowing the individual the person to really feel like they re part of your brand in a unique way Customer Managed Relationships marketing relationships in which customers empowered by todays new digital technologies interact with companies and with each other to shape their relationships with brands o Companies can no longer rely on marketing by Intrusion but rather have to use marketing by Attraction o Companies launch their own blogs or online communities in order to reach customers in more personal interactive way They use Tweets to start conversations Consumer Generated Marketing brand exchanges created by
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