Chapter 12. Customer-Driven Marketing

Size: px

Start display at page:

Download "Chapter 12. Customer-Driven Marketing"

Ursula Anthony
6 years ago
Views:

1 Chapter 12 Customer-Driven Marketing Summarize the ways in which marketing creates utility. Explain the marketing concept and relate how customer satisfaction contributes added value. Describe not-for-profit marketing, and identify the five major categories of nontraditional marketing Outline the basic steps in developing a marketing strategy. Describe the marketing research function. Identify and explain the methods available for segmenting consumer and business markets. Outline the determinants of consumer behavior. Discuss the benefits and tools for relationship marketing.

2 WHAT IS MARKETING? Marketing Organizational and set of for creating, communicating, and delivering to customers and for managing customer relationships in ways that benefit the and its. Exchange process Activity in which two or more parties give something of to each other to perceived needs. How Marketing Creates Utility Utility Want-satisfying power of a or. Time utility Making a good or service when customers want to it. Place utility Ownership utility

3 EVOLUTION OF THE MARKETING CONCEPT

4 Emergence of the Marketing Concept Marketing concept Company-wide consumer orientation to promote long-run success. Firm starts with analysis of customers needs and works backward to offer products that fulfill them. Explained by shift from sellers market in which goods and services are relatively scarce to buyers market in which they are relatively plentiful.

5 Delivering Added Value Through Customer Satisfaction and Loyalty Firm starts with analysis of customers needs and works backward to offer products that fulfill them. Customer satisfaction Ability of a good or service to meet or exceed a buyer s needs and expectations. Increasing customer loyalty just five percent equals significant increases in lifetime profits per customer. Customer Satisfaction and Feedback Can get feedback through toll-free telephone hotlines, customer satisfaction surveys, customer complaints, and other ways.

6 EXPANDING MARKETING S TRADITIONAL BOUNDARIES Not-for-Profit Marketing 20 million not-for-profits worldwide. Account for five percent of GDP worldwide. Apply marketing tools to reach audiences, secure funding, improve their images, and accomplish their overall missions. Sometimes partner with a profit-seeking company to promote a message.

7 Nontraditional Marketing

8 DEVELOPING A MARKETING STRATEGY First, study and analyze potential target markets and choose among them. Second, create a marketing mix to satisfy the chosen market.

9 Selecting a Target Market Target market Group of toward whom an markets its goods, services, or ideas with a designed to their specific needs and preferences. Marketing mix Blending the elements of marketing strategy product, distribution, promotion, and pricing to chosen customer. Developing a Marketing Mix for International Markets Standardization Offering the marketing mix in every market. Adaptation Developing a marketing mix to fit each market s competitive conditions, consumer preferences, and government regulations. Mass customization Firms mass produce goods and services and add unique features to or groups of orders.

10 MARKETING RESEARCH Marketing research Collecting and evaluating information to support marketing decision making. Obtaining Marketing Research Data Use internal and external data. Secondary data: Previously published data from trade associations, advertising agencies, marketing research firms, and other sources. Primary data: Data collected through observation, surveys, and other forms of observational study. AC Nielson Consumer Research

11 Applying Marketing Research Data As accuracy of research information increases, so does the effectiveness of the marketing strategies. Example: GM s H3 Hummer research Data Mining Data mining Computer searches of customer data to detect patterns and relationships. Uses data warehouses, sophisticated customer databases that allow managers to combine data from several different organizational functions. Example: Walmart s use to determine local preferences and tailor its inventory appropriately.

12 MARKET SEGMENTATION Market segmentation Process of dividing a total market into several relatively homogeneous groups.

13 How Market Segmentation Works

14 Segmenting Consumer Markets Geographic Segmentation Divides market into homogeneous groups on the basis of their locations. Demographic Segmentation Divides market on the basis of various demographic or socioeconomic characteristics. Psychographic Segmentation Divides consumer market into groups with similar psychological characteristics, values, and lifestyles. Product-Related Segmentation Divides market based on buyers relationship to the good or service. Segmenting Business Markets Resembles segmentation for consumer markets, but some methods differ.

15 CONSUMER BEHAVIOR: DETERMINING WHAT CUSTOMERS WANT Consumer behavior of ultimate consumers directly involved in,, and of products and the decision processes that precede and follow these actions. Determinants of Consumer Behavior Personal factors: and motives, perceptions,, self-concept. Interpersonal factors:,, and influences. Determinants of Business Buying Behavior Often a variety of from multiple decision makers.

16 Steps in the Consumer Behavior Process

17 CREATING, MAINTAINING, AND STRENGTHENING MARKETING RELATIONSHIPS Relationship marketing Benefits of Relationship Marketing Lower costs and profits for the business. Efficient of best customers that increases the: (5 words) Stronger relationships with business partners and opportunities to capabilities and resources to better accomplish goals.

18 Tools for Nurturing Customer Relationships 80/20 principle: Frequent customers have a higher lifetime value, so businesses allocate resources accordingly. Frequency Marketing and Affinity-Marketing Programs Frequency marketing Reward purchasers with cash, rebates, and other premiums. Affinity programs Solicit involvement based on common interest. Example: Credit card with baseball team logo Comarketing Businesses jointly market each others products. Cobranding Firms link their names in a single product. One-on-One Marketing Customizing products and marketing and rapidly delivering goods.

Chapter 11. Customer-Driven Marketing

Chapter 11. Customer-Driven Marketing Chapter 11 Customer-Driven Marketing Learning Objectives 1 Define marketing. 5 Describe marketing research. 2 3 4 Discuss the evolution of the marketing concept. Describe not-for-profit marketing and nontraditional