Principles of marketing 01
- 1. 7/13/2008 Marketing: Managing Profitable Customer Relationships Chapter 1 Objectives Be able to define marketing and discuss its core concepts. Be able to define marketing management and compare the five marketing management orientations. 1-1 1
- 2. 7/13/2008 Objectives Understand customer relationship management and strategies. Realize the major challenges facing marketers in the new “connected” millennium. 1-2 What is Marketing? Marketing is managing profitable customer relationships Attracting new customers Retaining and growing current customers t “Marketing” is NOT synonymous with “sales” or “advertising” 1-3 2
- 3. 7/13/2008 What is Marketing? Kotler’s social definition: “Marketing is a social and managerial process by which individuals and groups obtain what they need and want through h t th d d t th h creating and exchanging products and value with others.” 1-4 What Can Be Marketed? Goods S i Services Places Ideas Events Persons Properties Organizations Information Experiences What is being marketed in this ad? 1-5 3
- 4. 7/13/2008 Figure 1-1: Core Marketing Concepts 1-6 Discussion Question Resellers are a primary market for Nike’s products. Describe the exchange process between Nike and resellers. Think beyond the obvious. 1-7 4
- 5. 7/13/2008 Figure 1-2: Elements of a Modern Marketing System ode a e g ys e 1-8 Marketing Management M k ti management i “the Marketing t is “th art and science of choosing target markets and building profitable relationships with them. them ” Creating, delivering and communicating superior custome customer value is key. 1-9 5
- 6. 7/13/2008 Marketing Management Customer M C t Management: t Marketers select customers that can be served well and profitably. Demand Management: Marketers must deal with different demand states, ranging from no demand to too much demand. 1 - 10 Marketing Management Demarketing: Commuter Connections promotes the use of mass transit and carpooling as an alternative to driving alone. alone Commuter Connections 1 - 11 6
- 7. 7/13/2008 Marketing Management Production Management Product Concept Orientations Concept Selling Marketing Concept C t Concept C t Societal Marketing Concept 1 - 12 Figure 1-3: The Selling and Marketing Concepts Contrasted 1 - 13 7
- 8. 7/13/2008 Figure 1-4: Considerations Underlying the Societal Marketing Concept 1 - 14 Figure 1-5: Relationship Between Customer Satisfaction and Loyalty 1 - 15 8
- 9. 7/13/2008 CRM Customer relationship C t l ti hi management (also called CRM) is defined as: “the overall process of building and maintaining profitable d i t i i fit bl customer relationships by delivering superior customer value and satisfaction.” 1 - 16 CRM It costs 5 to 10 times MORE t t t ti to attract a new customer than it does to keep a current customer satisfied. Marketers must be concerned with the lifetime value of the customer. customer. 1 - 17 9
- 10. 7/13/2008 CRM Customer value and Key Concepts satisfaction ti f ti Perceptions are key Attracting, Created by meeting/ exceeding expectations retaining and Loyalty and retention growing Many benefits of loyalty customers Increases as satisfaction levels increase Building Delighting consumers relationships and should be the goal customer equity Growing customer share Cross- Cross-selling 1 - 19 CRM Key Concepts C t it Customer equity Total combined Attracting, customer lifetime retaining and values of all growing customers custo e s customers Measures firm’s firm s Building performance, but in relationships and a manner that looks customer equity to the future 1 - 20 10
- 11. 7/13/2008 CRM Customer relationship Key Concepts levels and tools Target market typically Attracting, dictates type of retaining and relationship Basic relationships growing Full relationships customers Customer loyalty and Building retention programs relationships and Adding financial benefits customer equity Adding social benefits Adding structural ties 1 - 21 Marketing Challenges Technological advances, rapid globalization, and continuing social and economic shifts are causing marketplace changes. Major marketing developments can be grouped under the theme of Connecting. Connecting. 1 - 22 11
- 12. 7/13/2008 Figure 1-6: Today’s Marketing Connections 1 - 23 Marketing Challenges Connecting Advances in computers, telecommunications, video- video-conferencing, etc. are major forces Via technology Databases allow for customization of With customers products, messages and analysis of needs With marketing The Internet partners Facilitates anytime, With the world anywhere connections Facilitates CRM Creates marketspaces 1 - 24 12
- 13. 7/13/2008 Marketing Challenges Connecting Selective relationship management is key Customer profitability Via technology analysis separates winners from losers With customers Growing “share of With marketing customer” Cross- Cross-selling and up- up- partners selling are helpful With the world Direct sales to buyers are growing 1 - 25 Marketing Challenges Connecting P t l ti hi Partner relationship management involves: Via technology Connecting inside With customers the company With marketing Connecting with outside partners partners Supply chain With the world management Strategic alliances 1 - 26 13
- 14. 7/13/2008 Marketing Challenges Connecting Globalization Competition New opportunities Via technology Greater concern for With customers environmental and social responsibility With marketing Increased marketing partners by nonprofit and With the world public- public-sector entities Social marketing campaigns 1 - 27 Connecting with Values . . . The Body Shop e ody S op Visit the “Our Values” and “About Us” sections of The Body Shop’s web site. How might the values espoused by the company influence the manner in which the Body Shop . . . • Chooses their strategic partners? • Advertises fragrances to consumers? • Develops new products? • How might these decisions in turn The Body Shop impact “the bottom line”? 1 - 28 14
- 15. 7/13/2008 Amazon c Strong sales, no Provides great profits selection, good Customer- Customer-driven value, discovery to its core as well as Each customer s customer’s convenience experience is A true online unique community 1 - 29 15