CHAPTER CREATING

CUSTOMER
RELATIONSHIP
S AND VALUE
THROUGH
MARKETING

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 WHAT IS MARKETING?

A Philosophy A Set of Activities,

including:
An Attitude
Products
A Perspective
Pricing
A Management
Orientation Promotion
Distribution
 WHAT IS MARKETING?

American Marketing Association Definition

Marketing is the process of planning and
executing the conception, pricing, promotion,
and distribution of ideas, goods, and services
to create exchanges that satisfy individual and
organizational goals.

Marketing = Using Exchanges to Satisfy Needs

The Concept of
Exchange
The idea that people
give up something to
receive something they
would rather have.

Both buyer and seller

are better off after
the trade.
 WHO DO I AIM AT?

 Market – All people with both the desire and ability

to buy a specific product

 Target Market – One or more subgroups I can satisfy

THE CONTROLLABLE MARKETING FORCES

The Four P’s

-the “arrow”
Price
Price

Promotion
Promotion

Place
Place

Product
Product
THE UNCONTROLLABLE MARKETING
FORCES

Social
Social

Natural
Natural

Economic
Economic

Technologic
Technologic
External
External
Environmental
Environmental
Factors Political
Political and
andLegal
Legal
Factors

Competitive
Competitive

Helps identify market opportunities

FIGURE 1-A Summary of factors that affect
an organization’s marketing program
FIGURE 1-4 Marketing’s task: satisfying
consumer needs
 HOW MARKETING BECAME
SO IMPORTANT

• Evolution of the Market Orientation

 Production Era
 Sales Era
 Marketing Concept Era
 Societal Era
 MARKETING MANAGEMENT
PHILISOPHIES

Orientation
Orientation Key Ideas

Production
Production Focus on efficiency of internal operations –
if we make it, they will buy it

Focus on aggressive sales techniques and

Sales
Sales believe that high sales result in high profits

Focus on satisfying customer needs and wants

Market
Market
while meeting objectives - if they will buy it, we
will make it
Focus on satisfying customer needs and
Societal
Societal wants while enhancing individual and
societal well-being. I.e.-mfg using recyclables
FIGURE 1-B Four different orientations in
the history of American business

Socie
tal
THE BREADTH & DEPTH OF MARKETING

 What Is Marketed?
• Goods • Services • Ideas

 Who Buys and Uses What Is Marketed?

• Ultimate Consumers
•Organizational Buyers
 HOW DO CONSUMERS BENEFIT

lity – the benefits or customer value receiv

by users of the product
 HOW TO DELIVER VALUE

Customer value-benefits received by targeted buyers

that include quality, price, convenience, on-time
delivery, and both before-sale and after-sale service.

• Offer products that perform

• Give consumers more than they
expect
• Avoid unrealistic pricing
• Give the buyer facts
• Offer organization-wide
commitment in service and
 KEEPING THE CUSTOMER SATISFIED


Meet
Meet or
or exceed
exceed customer’s
customer’s expectations
expectations

Provide
Provide solutions
solutions to
to customer’s
customer’s problems
problems

Cultivate
Cultivate relationships,
relationships,
NOT
NOT one-time
one-time transactions
transactions
 Concept Check

1. What is marketing?

A: Marketing is an organizational
function and a set of processes for
creating, communicating, and
delivering value to customers and for
managing customer relationships in
ways that benefit the organization
and its stakeholders.
 Concept Check

1. An organization can’t satisfy the

needs of all consumers, so it must
focus on one or more subgroups,
target
which are its ____________.
markets
 Concept Check

2. What are the four marketing mix

elements that make up the
organization’s marketing program?
A: product, price, promotion, place
 Concept Check

3. What are environmental forces?

A: Environmental forces are those that
the organization’s marketing
department can’t control. These
include social, economic,
technological, competitive, and
regulatory forces.
 Concept Check

1. What are the two key characteristics

of the marketing concept?
A: (1) strive to satisfy the needs of
consumers (2) while also trying to
achieve the organization’s goals.
 Concept Check

2. What is the difference between goods

and services?
A: Goods are physical objects whereas
services are complex intangible
items, such as legal advice, a college
education, or airline travel.
 Exchange

Exchange
Exchange is is the
the trade
trade of
of things
things ofof value
value
between
between buyer
buyer and
and seller
seller so
so that
that each
each is
is
better
better off
off after
after the
the trade.
trade.
 Market

A
A market
market consists
consists of
of people
people with
with both
both the
the
desire
desire and
and ability
ability to
to buy
buy aa specific
specific
product.
product.
 Customer Value

Customer
Customer value
value is
is the
the unique
unique
combination
combination ofof benefits
benefits received
received
by
by targeted
targeted buyers
buyers that
that includes
includes quality,
quality,
price,
price, convenience,
convenience, on-time
on-time delivery,
delivery, and
and
both
both before-sale
before-sale and
and after-sale
after-sale service.
service.
 Marketing Concept

The
The marketing
marketing concept
concept isis the
the idea
idea that
that
an
an organization
organization should
should (1)
(1) strive
strive to
to satisfy
satisfy
the
the needs
needs of
of consumers
consumers (2)
(2) while
while also
also
trying
trying to
to achieve
achieve the
the organization’s
organization’s goals.
goals.
 Market Orientation

An
An organization
organization thatthat has
has aa market
market
orientation
orientation focuses
focuses its
its efforts
efforts on
on
(1)
(1) continuously
continuously collecting
collecting information
information
about
about customers’
customers’ needs,
needs, (2)
(2) sharing
sharing this
this
information
information across
across departments,
departments, and
and
(3)
(3) using
using itit to
to create
create customer
customer value.
value.
Societal Marketing Concept

The
The societal
societal marketing
marketing concept
concept isis the
the
view
view that
that an
an organization
organization should
should satisfy
satisfy
the
the needs
needs of
of consumers
consumers in
in aa way
way that
that
provides
provides for
for society’s
society’s well-being.
well-being.
 Organizational Buyers

Organizational
Organizational buyers
buyers are
are those
those
manufacturers,
manufacturers, wholesalers,
wholesalers, retailers,
retailers,
and
and government
government agencies
agencies that
that buy
buy goods
goods
and
and services
services for
for their
their own
own use
use or
or for
for
resale.
resale.
 Utility

Utility
Utility is
is the
the benefits
benefits or
or customer
customer value
value
received
received byby users
users of
of the
the product.
product.