Chapter Twelve. Learning Objectives

Transcription

1 Chapter Twelve Building Customer Relationships Through Effective Marketing Learning Objectives 1. Understand the meaning of marketing and the importance of management of customer relationships. 2. Explain how marketing adds value by creating several forms of utility. 3. Trace the development of the marketing concept and understand how it is implemented. 4. Understand what markets are and how they are classified. 5. Identify the four elements of the marketing mix and be aware of their importance in developing a marketing strategy. 12 2

2 Learning Objectives (cont d) 6. Explain how the marketing environment affects strategic market planning. 7. Understand the major components of a marketing plan. 8. Describe how market measurement and sales forecasting are used. 9. Distinguish between a marketing information system and marketing research. 10. Identify the major steps in the consumer buying decision process and the sets of factors that may influence this process Chapter 12 Outline Managing Customer Relationships Utility: The Value Added by Marketing The Marketing Concept Evolution of the Marketing Concept Implementing the Marketing Concept Markets and Their Classification Developing Marketing Strategies Target tmarket tselection and devaluation Creating a Marketing Mix Marketing Strategy and the Marketing Environment Developing a Marketing Plan 12 4

3 Chapter 12 Outline (cont d) Market Measurement and Sales Forecasting Marketing Information Marketing Information Systems Marketing Research Using Technology to Gather and Analyze Marketing Information Types of Buying Behavior Consumer Buying Behavior Business Buying Behavior 12 5 Marketing The activity, set of institutions and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large 12 6

4 Managing Customer Relationships Relationship marketing Customer relationship management (CRM) Customer lifetime value 12 7 Utility: The Value Added by Marketing The ability of a good or service to satisfy a human need Form utility Place utility Time utility Possession utility 12 8

5 The Marketing Concept A business philosophy that involves the entire organization in the process of satisfying i customers needs while achieving the organization s goals To achieve success, a business must Talk to its potential customers to assess their needs Develop a good or service to satisfy those needs Continue to seek ways to provide customer satisfaction 12 9 Implementing the Marketing Concept Obtain information about present and potential customers Their needs; how well those needs are being satisfied; how products might be improved; customer opinions about the firm Pinpoint specific needs and potential customers toward which to direct marketing activities and resources 12 10

6 Implementing the Marketing Concept (cont d) Mobilize marketing resources to Provide a product that will satisfy customers Price the product at an acceptable and profitable level Promote the product to potential customers Ensure distribution for product availability when and where wanted Obtain information on the effectiveness of the marketing effort and modify efforts as necessary Markets and Their Classification Market Consumer markets Business to business (industrial) markets 12 12

7 Developing Marketing Strategies Marketing strategy Consists of The selection and analysis of a target market The creation and maintenance of an appropriate marketing mix (a combination of product, price, distribution, and promotion developed to satisfy a particular target market) Developing Marketing Strategies (cont d) Target market selection and evaluation Target market Market segment Market segmentation 12 14

8 Developing a Marketing Plan A written document that specifies an organization s resources, objectives, strategy, and implementation and control efforts to be used in marketing a specific product or product group Elements of a marketing plan Executive summary Environmental analysis Strengths and weaknesses Opportunities and threats Marketing objectives Marketing strategies Marketing implementation Evaluation and control Sales forecast Market Measurement and Sales Forecasting Importance of measuring sales potential Estimates should do several things 12 16

9 Marketing Information Marketing information system Internal data sources External data sources Outputs Marketing Information (cont d) The six steps of marketing research 1. Define the problem 2. Make a preliminary investigation 3. Plan the research 4. Gather factual information 5. Interpret the information 6. Reach a conclusion 12 18

10 Types of Buying Behavior The decisions and actions of people involved in buying and using products Consumer buying behavior Business buying behavior The American Consumer Consumer income Personal income Disposable income Discretionary income 12 20

11 Figure 12.1 Types of Utility 160 Wanted: One pair of size 8 shoes in Duluth, immediately. Will pay $50. Form utility Place utility Time utility Possession utility Types of Utility CAN SATISFY THE NEED WITH: Size 8 shoes Size 8 shoes in Duluth Size 8 shoes in Duluth available now Size 8 shoes in Duluth available now for $50 BUT CANNOT SATISFY THE NEED WITH: Size 10 shoes Size 8 shoes in Los Angeles Size 8 shoes in Duluth available next month Size 8 shoes in Duluth available now for $ X_12_ch12_p indd 160 3/6/09 8:33:01 PM

12 Table 12.2 Evolution of Customer Orientation 161 Evolution of Customer Orientation Business managers recognized that they were not primarily producers or sellers but rather were in the business of satisfying customers wants. Production Orientation Sales Orientation Customer Orientation Take orders Increase advertising Determine customer needs Distribute goods Enlarge sales force Develop products to fill these needs Intensify sales techniques Achieve the organization s goals 3768X_12_ch12_p indd 161 3/6/09 8:33:02 PM

13 Figure 12.2 General Approaches for Selecting Target Markets General Approaches for Selecting Target Markets UNDIFFERENTIATED APPROACH 162 Organization Product Price Distribution Promotion Single marketing mix A A A A A A A A A A A A A A A A A A A A A A A A A A A A A A A A A A A Target market CONCENTRATED MARKET SEGMENTATION APPROACH Organization Product Price Distribution Promotion Single marketing mix A A A A A A A A A A A A A A A B B B B B B B B B B B B B B B C C C C C C C C C C C C C C C Target market DIFFERENTIATED MARKET SEGMENTATION APPROACH Product Price Distribution Organization Promotion Marketing mix I Product Price Distribution A A A A A A A A A A A A A A A B B B B B B B B B B B B B B B C C C C C C C C C C C C C C C Target markets Promotion Marketing mix II NOTE: The letters in each target market represent potential customers. Customers that have the same letters have similar characteristics and similar product needs. Source: William M. Pride and O. C. Ferrell, Marketing: Concepts and Strategies, 15th ed. (Mason, Ohio: South-Western/Cengage Learning, 2010). Adapted with permission. 3768X_12_ch12_p indd 162 3/6/09 8:33:02 PM

14 Table 12.3 Common Bases of Market Segmentation 163 Common Bases of Market Segmentation Demographic Psychographic Geographic Behavioristic Age Personality attributes Region Volume usage Gender Motives Urban, suburban, rural End use Race Lifestyles Benefit expectations Ethnicity Market density Brand loyalty Income Climate Price sensitivity Education Terrain Occupation City size Family size County size Family life cycle State size Religion Social class Source: William M. Pride and O. C. Ferrell, Marketing: Concepts and Strategies, 15th ed. (Mason, Ohio: South-Western/Cengage Learning, 2010). Adapted with permission. 3768X_12_ch12_p indd 163 3/6/09 8:33:02 PM

15 Figure 12.3 The Marketing Mix and the Marketing Environment 164 The Marketing Mix and the Marketing Environment Economic forces Competitive forces Product Political forces Price Customer Distribution Marketing mix Marketing environment Sociocultural forces Promotion Technological forces Legal and regulatory forces Source: William M. Pride and O. C. Ferrell, Marketing: Concepts and Strategies, 15th ed. (Mason, Ohio: South-Western/Cengage Learning, 2010). Adapted with permission. 3768X_12_ch12_p indd 164 3/6/09 8:33:03 PM

16 Table 12.6 Internet Sources of Marketing Information 165 Internet Sources of Marketing Information Government Sources Commercial Sources Periodicals and Books census.gov acnielsen.com adage.com state.gov usa.infores.com salesandmarketing.com fedworld.gov gallup.com Fortune.com arbitron.com inc.com chamber-of-commerce.com businessweek.com bloomberg.com Source: William M. Pride and O. C. Ferrell, Marketing: Concepts and Strategies, 15th ed. (Mason, Ohio: South-Western/Cengage Learning, 2010). Reprinted with permission. 3768X_12_ch12_p indd 165 3/6/09 8:33:03 PM

17 Figure 12.4 Consumer Buying Decision Process and Possible Influences on the Process 166 Consumer Buying Decision Process and Possible Influences on the Process POSSIBLE INFLUENCES ON THE DECISION PROCESS Situational influences Psychological influences Social influences Physical surroundings Social surroundings Time Purchase reason Buyer s mood and condition Perception Motives Learning Attitudes Personality Lifestyles Family Roles Peer groups Social class Culture and subcultures CONSUMER BUYING DECISION PROCESS Recognize problem Search for information Evaluate alternatives Purchase Evaluate after purchase Source: William M. Pride and O. C. Ferrell, Marketing: Concepts and Strategies, 15th ed. (Mason, Ohio: South-Western/Cengage Learning, 2010). Adapted with permission. 3768X_12_ch12_p indd 166 3/6/09 8:33:03 PM

18 Figure 12.A Chapter Outline 167 Chapter 12 Outline Building Customer Relationships Through Effective Marketing Managing Customer Relationships Utility: The Value Added by Marketing The Marketing Concept Evolution of the Marketing Concept Implementing the Marketing Concept Markets and Their Classification Developing Marketing Strategies Target Market Selection and Evaluation Creating a Marketing Mix Marketing Strategy and the Marketing Environment Developing a Marketing Plan Market Measurement and Sales Forecasting Marketing Information Marketing Information Systems Marketing Research Using Technology to Gather and Analyze Marketing Information Types of Buying Behavior Consumer Buying Behavior Business Buying Behavior 3768X_12_ch12_p indd 167 3/6/09 8:33:03 PM

19 Figure 12.B Class Exercise 168 Class Exercise Identify one or several characteristics or variables that could be used to segment the markets for each of the following products. 1. Recreational vehicles (RVs) 2. Baby food 3. Rolls Royce automobiles 4. Snow tires 5. Hotel rooms 6. Magazines 7. Soft drinks 8. Movies 9. Shoes 10. Bicycles 11. Air passenger service 12. Cameras 13. Swimsuits 14. Restaurants 3768X_12_ch12_p indd 168 3/6/09 8:33:03 PM

20 Figure 12.C Debate Issue Debate Issue Does marketing research (surveys, telephone interviewing) invade a respondent s privacy? YES A great deal of marketing research asks questions that are too personal. Some marketing research, especially telephone and personal interviews, is nothing more than a disguise for sales presentations. The information obtained from marketing research is often used to develop mailing lists that are used to sell consumers products that they may not want. Sometimes the true nature of the research is disguised to get consumers to respond. NO 169 The right to privacy deals with an individual s ability to restrict personal information. Individual respondents must decide for themselves how much of their personal lives they will share with others. What constitutes private information and public information is ultimately up to the individual respondent. As long as the researcher obtains the consent of the respondent, the research does not invade the respondent s privacy. 3768X_12_ch12_p indd 169 3/6/09 8:33:03 PM

21 Figure 12.D Chapter Quiz Chapter Quiz 1. The utility created by transferring title of a product to the buyer is called utility. a. form b. time c. production d. place e. possession 2. J.C. Penney is considered to be a member of which type of market? a. Business-to-business b. Reseller c. Consumer d. Producer e. Institutional 3. The ingredient of the marketing mix concerned with product design, brand names, packaging, and warranties is a. pricing. b. quality. c. product. d. distribution. e. promotion. 4. All of the following are true of marketing plans except that they should a. not be modified. b. include details of task scheduling. c. specify task objectives. d. describe the firm s current situation. e. focus on a particular product or product group. 5. In this chapter, MIS refers to system. a. merged information b. major information c. marketing information d. market influential segmentation e. minor information X_12_ch12_p indd 170 3/6/09 8:33:03 PM

22 Figure 12.E Exchange Between Buyer and Seller 171 Exchange Between Buyer and Seller Something of value Money, credit, labor, goods Buyer Seller Something of value Goods, services, ideas Source: William M. Pride and O. C. Ferrell, Marketing: Concepts and Strategies, 15th ed. (Mason, Ohio: South-Western/Cengage Learning, 2010). Reprinted by permission. 3768X_12_ch12_p indd 171 3/6/09 8:33:03 PM

23 Figure 12.F Evolution of Customer Orientation 172 Evolution of Customer Orientation PRODUCTION ORIENTATION Take orders Distribute goods SALES ORIENTATION Increase advertising Enlarge sales force Develop sales techniques CUSTOMER ORIENTATION Determine customer needs Develop goods and services to fill needs 3768X_12_ch12_p indd 172 3/6/09 8:33:04 PM

24 Figure 12.G Components of a Marketing Plan Components of a Marketing Plan I. Executive Summary II. Environmental Analysis A. The Marketing Environment B. Target Market(s) C. Current Marketing Objectives and Performance III. Strengths and Weaknesses IV. Opportunities and Threats V. Marketing Objectives VI. Marketing Strategies A. Target Market B. Marketing Mix VII. Marketing Implementation VIII. Evaluation and Control A. Performance Standards B. Financial Controls C. Monitoring Procedures X_12_ch12_p indd 173 3/6/09 8:33:04 PM

25 Figure 12.H Combining Market Research and the Marketing Information System 174 Combining Market Research and the Marketing Information System 3768X_12_ch12_p indd 174 3/6/09 8:33:04 PM

26 Figure 12.I Definition of Marketing 175 MARKETING 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 3768X_12_ch12_p indd 175 3/6/09 8:33:07 PM

27 Figure 12.J Should the Government Regulate Marketing Activities More? 176 Do We Need More or Less Government Regulation of Marketing Activities? Source: Harris Interactive/Public Relations Society of America Foundation telephone survey of 1,015 adults ages 18 and older. 3768X_12_ch12_p indd 176 3/6/09 8:33:07 PM