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| Process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return. |
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1. Understand the marketplace and customer needs and wants
2.Design a customer driven marketing strategy
3.Construct a marketing program that delivers superior value
4.build profitable relationships and create customer delight
5.capture value from customers to create profits and customer quality |
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| Combo of products, services, info, or experiences that satisfy a need or want |
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| Customers form expectations regarding value and marketers must deliver value to consumers |
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| A satisfied customer will come again and tell others about their good experience |
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| the act of obtaining a desired object from someone by offering something in return--just 1 exchange is not the goal--you want many exchanges! |
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| Set of actual and potential buyers of a product |
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| The mistake of focusing too narrowly on the product the company offers rather then the benefits and experiences the product offers |
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| The art and science of choosing target markets and building profitable relationships with them |
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| What customers a business will serve |
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| the set of benefits or values it promises to deliver to consumers to satisfy their needs |
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| the set of marketing tools the firm uses to implement its marketing strategy |
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| Customer Relationship Management |
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| the overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction--deals with all aspects of acquiring, keeping and growing customers |
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| the customers evaluation of the difference between benefits and costs |
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| Depends on the product's perceived performance relative to a buyer's expectations |
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| Companies delight customers by promising only what they can deliver and delivering more than they promise--this leads to emotional relationships and loyalty |
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| the combined discounted customer lifetime values of all the company's current and potential customers |
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| 5 Types of Challenges in Marketing |
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1. Digital Age
2. Globalization
3. Ethics and Social Responsibility
4. Not for Profit Marketing
5. Marketing Relationships |
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| the process of developing and maintaining a strategic fit between the organization's goals and capabilities and its changing marketing opportunities |
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| the organization's purpose, what it wants to accomplish in the larger environment |
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| the company's needs to turn its mission into detailed supporting objectives for each level of management |
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| the collection of businesses and products that make up the company |
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| the process by which management evaluates the products and businesses making up the company |
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| Steps in Analyzing the Current Business Portfolio |
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1. Identify key businesses making up the company
2. Assess the attractiveness of its various SBU's
3. Decide how much support each SBU deserves |
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| Strategic Business Unit (SBU) |
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| A unit of the company that has a separate mission and objectives that can be planned separately from other company businesses |
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| a portfolio method that evaluates a company's strategic business units in terms of their market growth rate and relative share |
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1. Stars
2. Cash Cows
3. Question Marks
4. Dogs |
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| high growth, high share businesses or products requiring heavy investment to finance rapid growth--eventually turn into cash cows. |
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| low growth, high share businesses or products that are established and successful SBU's requiring less investment to maintain market share |
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| Low share business units in high growth markets requiring a lot of cash to hold their share |
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| Low growth, low share businesses and products that may generate enough cash to maintain themselves but do not promise to be large sources of cash |
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| Product Market Expansion Grid |
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| a tool for identifying company growth opportunities through market penetration, market developement, product developement, or diversification |
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| Product/Market Expansion Grid Strategies |
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1. Market Penetration
2. Market Developement
3. Product Developement
4. Diversification |
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| growth strategy increasing sales to current market segments without changing the product |
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| growth strategy that identifies and develops new market segments for current products |
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| growth strategy that offers new or modified products to existing market segments |
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| growth strategy through starting up or acquiring businesses outside the company's current products and markets |
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| the reduction of the business portfolio by eliminating products or business units that are not profitable or that no longer fit the company's overall strategy |
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| the marketing logic by which the business unit hopes to achieve its marketing objectives |
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| the division of a market into distinct groups of buyers who have distinct needs, characteristics, or behavior, and who might require separate products or marketing mixes |
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| the process of evaluating each market segment's attractiveness and selecting one or more segments to enter |
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| the arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of the target consumer |
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| the set of controllable tactical marketing tools (product, price, place, and promotion) that the firm blends to produce the response it wants in the target market |
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| Marketing Mix (The 4 P's) |
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Definition
1. Product-the goods, services, and ideas in combination that the company offers to the target market
2. Price- the amount of money customers have to pay to obtain the product
3. Place- the company activities that make the product available to target customers
4. Promotion- the activities that communicate the merits of the product and persuade target customers to buy it |
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1. Product--Customer Solution
2. Price--Customer Cost
3. Place--Convenience
4. Promotion--Communication |
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| the complete analysis of the company's situation in a SWOT analysis that evaluates the company's strengths, weaknesses, opportunities, and threats |
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| the devolopment of strategic and marketing plans to achieve company objectives--written guideline |
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| measuring and evaluating results and corrective action as needed--2 Parts: Operating and Strategic |
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| involves checking ongoing performance against annual plan and taking corrective action as needed |
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| involves looking at whether the company's basic strategies are well matched to its opportunities |
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| a comprehensive, systematic, independent, and periodic examination of a company's environment, objectives, strategies, and activities to determine problem areas and opportunities |
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| includes the factors and forces outside marketing that affect marketing management's ability to build and maintain successful relationships with customers |
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| consists of the factors close to the company that affect its ability to serve its customers, the company, suppliers, marketing intermediaries, customer markets, competitors, and publics |
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| Forces of the Microenvironment |
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Definition
1. Company- the company's internal environment includes top management, finance, R&D, purchasing, operations and accounting
2. Suppliers- provide the resources to produce goods and services--treated as partners to provide customer value
3. Marketing Intermediaries- help the company to promote, sell and distribute its products to final buyers--(Resellers, Physical Distribution Firms, Marketing Services Agencies, & Financial Intermediaries)
4. Customers- Include Customer Markets, Business Markets, Reseller Markets, Government Markets, and International Markets
5. Competitors- firms must gain an advantage by positioning their offerings against competitor offerings
6. Public- any group that has an actual or potential interest in or impact on an organization's ability to achieve its objectives--(Financial Publics, Media Publics, Government Publics, Citizen-Action Publics, Local Publics, General Public, Internal Public) |
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| Type of marketing intermediary--distribution channel firms that help the company find customers or make sales to them and include wholesalers and retailers |
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| Physical Distribution Firms |
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| Type of Marketing intermediary--distribution channel firms that help the company to stock and move goods form their points of origin to their final destination |
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| Marketing Services Agencies |
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| Type of Marketing intermediary--the marketing research firms, advertising agencies, media firms, and marketing consulting firms that help the company target and promote its products to the right markets |
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| Type of Marketing intermediary--include banks, credit companies, insurance companies, and other businesses that help finance transactions or insure against the risks associated with the buying and selling of goods |
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| consist of individuals and households that buy goods and services for personal consumption |
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| buy goods and services for further processing or for use in their production process |
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| buy goods and services to resell at a profit |
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| buy goods and services to produce public services or transfer goods and services to others who need them |
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| consists of buyers in other countries including consumers, producers, resellers, and governments |
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| influence the company's ability to obtain funds-banks, investment houses and stockholders |
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| carry news, features, and editorial opinion--newspapers, magazines, and radio and television stations |
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| influence product safety and truth in advertising |
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| includer consumer organizations, environmental groups, and minority groups |
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| include neighborhood residents and community organizations |
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| influences the company's public image |
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| Include workers, managers, volunteers, and directors |
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| consists of the larger societal forces that affect the microenvironment such as the Demographic Environment |
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| the study of human populations in terms of size, density, location, age, gender, race, occupation, and other statistics |
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| include age, family structure, geographic population shifts, educational characteristics, and population diversity |
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| 1946-1964--most affluent Americans--younger boomers at the ages of 41-49 are known to be materialistic |
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| 1965-1979--dont have a lot of time because of kids and work--spend 1.4 trillion annually (less than baby boomers) |
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| 1979-2000--Internet generation--product placement |
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| Marketing's Impact on Individual Consumers |
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Definition
1. High cost of distribution
2. High advertising and promotion costs
3. Excessive markups
4. Deceptive practices |
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| High Cost of Distribution (Complaint & Response) |
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Definition
Complaint: intermediaries mark up prices beyond their value due to inefficiencies and unnecessary or duplicative services
Response: markups reflect the cost of the services that consumers expect such as convenience, larger stores and assortments, more service, return privileges |
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| High Advertising and Promotion Costs (Complaint and Response) |
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Definition
Complaint: prices are inflated to absorb advertising and sales promotion costs, and packaging only adds to the psychological not functional value of the product
Response: adveritising does add to product cost but also to product value by informing potential customers of the availability and merits of the product |
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| Excessive Markups (Complaint & Response) |
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Complaint: companies mark up products excessively
Response: most businesses try to deal fairly with consumers because they want to build relationships and repeat business |
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| Deceptive Practices (Complaint & Response) |
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Definition
Complaint: companies use deceptive practices that lead customers to believe they will get more value than they actually do. 3 CAtegories: Deceptive Pricing, Deceptive Promotion, Deceptive Packaging
Response: Wheeler-Lea Act |
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| Type of deceptive Practice--includes practices such as falsely advertising "factory" or "wholesale" prices or a large price reduction from a phony retail list price |
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| Type of deceptive practice--includes practices such as misrepresenting the product's features or performance or luring the customer to the store for a bargain that is out of stock |
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| Type of deceptive practice--includes exaggerating packaging contents through subtle design, using misleading labeling, or describing size in misleading terms |
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| response to Deceptive practices--gives the Federal Trade Commission (FTC) power to regulate "unfair or deceptive acts or practices" |
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| Poor Service to Disadvantaged Customers (Complaint & Response) |
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Complaint: American marketers serve disadvantaged customers poorly. Some retail companies "redline" poor neighborhoods and avoid placing stores there.
Response: some marketers profitably target these customers and the FTC has taken action against marketers that do advertise false values, wrongfully deny service, or charge disadvantaged customers too much. |
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| Marketing Impact on Society as a Whole (Complaint & Response) |
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False wants and too much materialism--Complaint: the marketing system urges too much interest in material possessions. People are judged by what they own rather than who they are, creating false wants that benefit industry more than they benefit customers
Response: People do have strong defenses against advertising and other marketing tools. Marketers are most effective when they appeal to existing wants rather than creating new ones. The high failure rate of new products shows that companies cannot control demand. |
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