UNIVERSITY OF CEBU (UC)

GRADUATE SCHOOL
Sanciangko St., Cebu City

REACTION PAPER IN
MARKETING MANAGEMENT (BM 207)

Masterand: Agnes C. Ampo Course: MBA

Professor: Dr. Eddie E. Llamedo Schedule: BL1 Sat, 12:00nn-4:30pm

Chapter 7 - Designing a Customer Value Driven Strategy and Mix Customer

Value-Driven Marketing Strategy: Creating Value for Target Customers

Introduction

In a highly competitive business environment, focusing on the needs of your

customers can give you edge over the competition. Satisfied customers are more

likely to be repeat customers and to steer new business to your enterprise. As such,

your marketing strategy should be geared toward reaching those who would benefit

the most from your product or service. A customer-driven marketing strategy includes

elements like identifying your target market and reacting to their needs. It should also

detail ways to retain customers and use them to help you gain additional business.

Topic Summary

What is marketing strategy? This lays out target market and value proposition

that will be offered on an analysis of the best market opportunities. It is an action

plan designed to promote and sell a products and services. A written plan that

includes marketing topics like product development, promotion, distribution and

pricing approach. There are four major steps in designing a customer value-driven

marketing strategy. In selecting customers to serve this can be through segmentation

and targeting while in deciding a value proposition, this will be differentiation and
positioning. Market segmentation is the process of dividing a potential market into

distinct subsets of consumers and selecting one or more segments as a target

market to be ca can be reached more efficiently and effectively with products and

services that match their needs, characteristics, or behaviors. There are four

important market segmentation -segmenting consumer markets, business markets,

international markets and the requirements for effective segmentation. The variables

of segmenting consumer markets includes geographic segmentation, demographic

segmentation (age and life cycle stage, gender and income), psychographic

segmentation and behavioral, multiple segmentation, geodemographic

segmentation. You can also segment business markets and international market. In

segmenting international markets, this can be geographic, economic, political-legal

nd cultural. There is also intermarket segmentation which divides consumers into

groups with similar needs and buying behaviors even though they are located in

different countries. The requirements for effective segmentation should also be

considered. This should be measurable, accessible, substantial, differentiable and

actionable. Market targeting is consists of evaluating each market segment's

attractiveness and selecting one or more market segments to enter. In evaluating,

you need to consider the segment size and growth, structural attractiveness and

company objectives and resources. This has target marketing strategies to be

followed which are undifferentiated (mass) marketing, differentiated marketing,

concentrated marketing, and micromarketing. Undifferentiated marketing targets the

whole market with one offer. Differentiated marketing targets several different market

segments and designs separate for each. Concentrated marketing targets a small

share of a large market. Micromarketing is the practice of tailoring products and

marketing programs to suit the tastes of specific individuals and locations. This can
be local which involves tailoring brands and promotion to the needs and wants of

local customer groups and individual marketing which involves tailoring products and

marketing programs to the needs and preferences of individual customers. In

choosing a target market, this depends on company resources, product variability,

product life-cycle stage, market variability, competitor's marketing strategies. There is

also socially responsible target marketing. Product position is the way the product is

defined by consumers on important attributes – the place the product occupies in

customer's minds relative to competing products. Differentiation is to differentiate

the market offering to create a superior customer value. In choosing a differentiation

and positioning strategy it is import to identify a set of possible competitive

advantages to build a position (product differentiation, service differentiation, channel

differentiation, people differentiation and image differentiation), choosing the right

competitive advantages, selecting an overall positioning strategy and developing a

positioning statement. Competitive advantage is an advantage over competitors

gained by offering consumers greater value, either through lower prices or by

providing more benefits that justify higher prices. In choosing right comparative

advantage, difference to promote should be important, distinctive, superior,

communicable, preemptive, affordable and profitable. In selecting an overall

positioning strategy, value proposition should be considered. This is the full mix of

benefits upon which a brand is positioned. Choosing the positioning is often easier

than implementing the position.

Recommendation

The reporter's report was not well elaborated. It would help if she gave more

examples. This will help us understand deeply the concepts presented. The voice is

faint too. The handouts provided were incomplete. The slide presentation is more
detailed than the handouts.

Conclusion

Thus, an effective customer-driven marketing strategy thinks of the customer

from start to finish in both the design and execution. Taking into account the

customers’ wants and needs should always be part of this strategy. The company

should never neglect the crucial importance of centering the marketing strategy

around the customers’ needs by delivering superior value. Only then, it can survive in

today’s competitive marketplace.