Creating Customer Value
01/03/17 Marketing- the process of building profitable customer relationships by creating value for customers and capturing value in return
- telling and selling
- attracts new customers and grow current customers in the long term
Creating Value
- understand customer’s needs (necessities), wants (desires) and demands (luxuries) - customer-driven marketing strategy
- integrated marketing program – superior value - build profitable relationships, customer delight
Capture Value
- Sales, profit, long-term customer equity
Market Offering
- A product offered to a market to satisfy a need or want
- goods, services, places, persons, ideas, organisation, experiences, information
Marketing Organisation
- Set of benefits or values that it promises to deliver to customers to satisfy needs - Should differentiate brands and position them in the marketplace
Exchange
- Process of obtaining a desired object from someone by offering something in return
Transaction
- Trade between two parties, involving at least 2 things of value - Agreed upon conditions and a time and place of agreement
Market = set of actual buyers + set of potential buyers
Buyers share a particular need or want that can be satisfied through exchange relationships
Marketing Management
- Art and science of choosing target markets and building profitable relationships with them
Managing Customer Demand
- Sources of demand – new, potential customers and repeat, existing customers
- Marketing decisions – finding, increasing and retaining demand as well as changing or reducing demand
De-marketing
- Permanently – to discourage anti-social behaviours
- Temporarily – to cope with peak demand periods and overfull demand
Marketing Management Orientation Concepts
- Production – production and distribution efficiency – highly available and affordable
- Product – continuous product improvements – offer most quality, performance and innovative features
- Selling – Large scale selling and promotion
- Marketing – Understanding customer needs and wants, delivering satisfaction efficiently - Societal marketing – deliver value in ways that maintain both consumer and society’s wellbeing
Starting Point Focus Means Ends (Profits)
Selling Factory Existing products Selling and promoting
Sales volume
Marketing Market Customer needs Integrated marketing
Customer satisfaction
Marketing Program
- Builds customer relationships by transforming the marketing strategy into action
- Consists of the firm’s marketing mix – marking tools used to implement marketing strategy
Customer Relationship Management (CRM)
- Overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction
Customer Perceived Value
- Customer’s perceived benefits – economic, functional and psychological - Customer’s resources used – money, time, effort
- What customer gives vs what the get
Customer Satisfaction
- Perception of performance compared to expectation of performance
Customer Lifetime Value (CLV)
- Value of an entire stream of purchases
Reflection
- Define marketing. How has your opinion about marketing changed after today's activities? If so in what ways has your opinion changed?
- What conditions must exist before a marketing exchange can take place?
- What forces shape the marketing environment?
- As a small business owner, how can these forces influence your ability to facilitate the marketing exchange.
