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Marketing: Build profitable customer connections (Marketing Strategy:…
Marketing: Build profitable customer connections
Marketing: Getting Value by Giving Value
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
Utility: ability of goods to satisfy customer's wants
Form utility: converting inputs into a finished forms
Time utility: providing goods at convenient time for customers
Place utility: providing goods at a convenient place for customers
Ownership utility: smoothly transferring ownership of goods from seller to buyers
The scope of marketing: everywhere
non-profit: use marketing to achieve objective
for-profits
People marketing: sport, politics and art dominate this category (become living symbol)
figure out what your customer needs and unsure the product (you) delivers above and beyond expectations
Place marketing: drawing people to particular place (cities and states attract business)
Event marketing: includes marketing or sponsoring athletic, cultural or charitable events
partnership between public and priate sectors are increasingly common
Idea marketing: change how people think or act.
The evolution of Marketing: from the Product to the Customer
Production Era: customer didn't have much choices, products were purchased as soon as they were produced -> priority: efficiency w/ large quantity
Selling Era: supply exceed demand -> hard sell + depression
Marketing Era: market have choices -> soldiers returned from WWII -> provide products meet customer needs best
marketing concept
: philosophy that makes customer satisfaction the central focus of the entire organization
Relationship Era: acquring new customer > 5 times retaining customer, "word of mouth"
The Customer: Front and Center
Customer Relationship Management
CRM: the ongoing process of acquring, maintaining and growing profitable customer relationship by delivering unmatched value
Limited relationship: scope of your relationship depends on data you gather and your industry
Full partnership: high-ticket product and smaller customer base -> gather and leverage extensive information about each customer and include the customer in key aspects of the product development process
Value: a customer perception that a product has better relationship than its competitors betweeen the cost and the benefits
Perceived Value vs. Actual Value: must help customer believe that your product is uniquely qualified
challenging when new business compete with existing strong perceived value market leader
Cusomter Satisfaction: when customer perceive that a good or service delivers value above and beyond their expectation
2 traps:
overpromising: disappointed if product fall short expectation -> keep it real
underpromising: few customer willing to try product
Customer Loyalty: when customers buy a product from the same supplier again, sometimes paying more than for competitive products
Marketing Strategy: Where to go and How to get there
Who is your customer?:
Marketing plan
: formal document that defines marketing objectives and specific strategies for achieving those objectives
Who most likely to buy your product:
Market segmentation: deviding potential customers into groups of similar people or segment
determine how you can best use marketing tools to reach them
anticipate and respind to changes in external environment
Target market: group of people who are most likely to buy a particular product
Characteristic of target market:
Size: enough to support a business
Profitability: people willing and able to spend more than the cost of producing and marketing your product
Accessibility: reachable through channels that your business can afford
Limited competition: crowded market is hard to crack
Consumer Markets vs. Business Markets (lies in the customer's intention)
consumer marketers (B2C): direct their effort to people who are buying products for personal consumption
business marketers (B2B): direct their efforts to customers who buy products to use either directly or indirectly to produce other goods
Customer Market Segmentation
Demographic segmentation: dividing the market into smaller groups based on measurable characteristics about people (age, income, ethnicity, gender), starting point of most marketers
Geographic segmentation: dividing market into smaller groups based on where consumers live (countries, cities, population density)
Psychographic segmentation: dividing the market based on consumer attitudes, interest, values, lifestyles (use to complement other segmentation rather than core definition)
Behaviorial segmentation: dividing market based on how people behave toward various products, include benefits consumer seek and how consumer use the products
Business Market Segmentation
Gepgraphic segmentation: based on concentration of cusomter
Customer-based: characteristic of customer
Product-use based: how customer will use the product, helpful to narrow target
Marketing Mix: the blend of marketing strategies for product, price, distribution and promotion
Product strategy: range from brand name, product image, package design, customer service, guarantees, new product development...
begin with understanding the need of target market
Pricing strategy: price must be fair, relative to the benefit of the product, competition, regulation, public opinion, product category (desk or knee surgery)
Distribution strategy: key decision: shipping, warehousing, selling outlets
Promotion stratege: key elements: advertising, personal selling, sales promotions, public relations, word-of-mouth, product placement
Global Marketing Mix: for each new country you enter (eg: Nike create sport league bc Chinese didn't play sport)
Marketing Environment
marketing scanning (key tool): process of contiually collecting information from the external marketing environment
Key elements:
Competitive environment (affect day-to-day): begins with analysis of
market share
(percentage of a market controlled by a given marketer)
avoid ambush, uncover new opportunities, monitor both dominant and emerging competitors
Economic environment: always change, hard to predict -> identify and respond to changes as soon as possible
Social/cultural environement: lifestyle, customs, language, attitudes, interests, population shifts -> must anticipate and respond to trends
Technological environement: visible to customers but less visible to marketers
Political/ legal environment: laws, regulations and political climate, include changing level of govenmental support for various business categories
Global Marketing Environment: Internet, importance of understanding each element of the marketing environment
Customer Behavior: Decisions
Customer Behavior: description of how people act when they are buying, using, discarding goods and services for their own personal consumption. Consumer behavior also explore the reasons behind people's actions
consumer decision process: need recognition -> information search - > evaluation of alternatives -> purchase decision - > postpurchase behavior
Cognitive dissonance: consumer discomfort with a purchase decision
avoid by developing specific programs to help custoers validate their purchase choices (eg: post-purchase mailings to highlights accolades received by expensive product)
Business buyer behavior: how people act when they're buying products to use either directly or indirectly to produce other products
usually buy according purchase specifications and objective standards, seek highly customized goods
Marketing Research
marketing research: gathering, interpreting and applying information to uncover marketing opportunities and challendges and to make better marketing decisions
identify external opportunities and threats (social trends and competitors)
monitor and predict customer behavior
evaluate and improve each area of the marketing mix
Types of Data
Secondary data: existing data that marketers gather or purchase for a research project
Primary data: new data that marketers compile for a specific research project
Primary research tools
Observation research: marketing reserach that does not require the researcher to interact with the research project
cheap and effective, people do differs from what they say
doesn't yiel any information on consumer motivation
Survey research: marketing research that requires researcher to interact with the research subject
can secure information about what people are thinking and feeling
many arent honest or accurate
International Perspective: many companies hire research firms with strong local presence to handle international marketing research projects
Social Responsibility and Technology: Major Marketing Shift
Marketing and Society: social responsibility movement
Green marketing: developing and promoting environmentally sound products and practices to gain a competitive edge (but in tough economics times is not suitable)
Technology and Marketing: Internet and digital technology
Mass customization: creation of products tailored for individual consumers on a mass basis