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Chapter 7: Customer-Driven Marketing Strategy: Creating Value for Target…
Chapter 7: Customer-Driven Marketing Strategy: Creating Value for Target Customers
Market Segmentation=use to divide large markets into small markets, can be reached more efficiently, effectively
Segmenting consumer markets
Geographic
nations
regions
states
countries
cities
Demographic
age & life-cycle
gender
income
Psychographic
social class
lifestyle
personality traits
Behavioral
Knowledge
attitudes
uses
responses to a product
occasion
divide buyers into group, occasions, get idea to buy, actually make purchases
benefits sought
major benefits people look for in the product class
major brands deliver each benefit
user status
ex-users
potential users
first-time users
regular users
loyalty status
base on buyers' degree of loyalty
completely loyal
somewhat loyal
not loyal
Segmenting business markets
same segmentation variables as consumers
Purchasing approaches
Customer-operating characteristics
Situational approaches
Personal characteristics
Segmenting international markets
Geographic location
Economic factors
Political and legal factors
Culture factors
Intermarket=similar needs & buying behaviors, different countries
Requirements for Effective Segmentation
Measurable=size, purchasing power, profiles
Accessible=the market can be effectively reached, served
Substantial=markets+large+profitable enough to serve
Differentiable=markets are conceptually distinguishable, respond differently to marketing mix elements & programs
Actionable= effective programs can be designed
Marketing Target
Evaluating Market Segments
segment size and growth
smaller vs larger segments
growth potential
segment structural attractiveness
competition
substitute products
power of buyers
power of suppliers
company objectives and resources
competitive advantage
availability of resources
consistent with company objectives
Selecting target market segments
undifferentiated marketing/mass marketing
targets the whole market with one offer
common needs
differentiated marketing/segmented marketing
target several different market segment, and designs separate offers for each.
concentrated marketing/niche marketing
target small share of a large market
micromarketing/local or individual marketing
suit the tastes of specific individuals and locations
Local marketing
tailoring brands, promotion needs and wants of local customer groups
cities
neighborhoods
stores
individual marketing
tailoring brands, promotion needs and wants of individual customers
Choosing a Targeting Strategy
company resources
product variability
product life cycle stage
market variability
competitor's marketing strategies
Socially Responsible Target Marketing
Benefits customers with specific needs
Concern for vulnerable segments
children
alcohol
cigarettes
Differentiation and Positioning
Product position=product is defined by consumers on important attributes
Perceptions
Impressions
Feelings
Positioning maps=consumer perceptions of their brands vs competing products on important buying dimensions.
Choosing a Differentiation and Positioning Strategy
Identifying a set of possible competitive advantages to build a position
Product differentiation
Service differentiation
Channels
People
Image
Choosing the right competitive advantages
Important
Distinctive
Superior
Communicable
Preemptive
Affordable
Selecting an overall positioning strategy
Value proposition=full mix of benefits upon which a brand is positioned.
More for more
More for the same
Same for less
Less for much less
More for less
Positioning for Competitive Advantage
Positioning statement= states the product’s membership in a category and then shows its point-of-difference from other members of the category.
Chapter 1: Marketing: Managing Profitable Customer Relationships
Marketing= create value+build strong customer relationships+capture value from customers.
The Marketing process
Understand the marketplace+Customers' needs/wants
Customer Needs, Wants, and Demands
Needs
Social
Affection
Belonging
Physicals
Clothing
Warmth
Food
Safety
Individual
Self-expression
Knowledge
Wants=needs+ culture+ individual personality
Demands= wants+buying power
Market Offering-Products, Services and Experiences
Marketing Myopia= existing wants+losing sight underlying consumer needs
Marketing offerings=products+services+information+experiences-> satisfy need/want
Customer Value and Satisfaction
Expectations
Customers= value+satisfaction high/low satisfaction
Marketers= set right level of expectations
Exchange & Relationships
Exchange=obtaining object+from someone by offering sth in return
Relationships= actions+build+maintain+desirable relationships
Markets= actual+potential buyers of a product
Marketing system= actors (suppliers, company, competitors, intermediaries, customers) in system who are affected by major environmental forces
Create customer driven marketing strategy
Marketing Management=art=science of choosing target markets+building profitable relationship
Selecting Customers to Serve
Target marketing=segements to go affter
Market segmentation= dividing, segments of customers
De=marketing
reduce demand temporarily/permanetly
aim= destroy demand but to reduce/shift
Marketing management
Customer management
Demand management
Choosing a Value Proposition
Value proposition= benefits/values a company promises to deliver
Marketing Management Orientations
Production concept=idea, consumers will favor poducts-available/highly affordable
Product concept=products-offer the most quality, performance, features
Selling concept=consumers will not buy enough, unless it undertakes a large scale selling, promotion effort
Marketing concept=achieving organizational goals depends on knowing the needs, wants of target market, satisfactions better than competitors do
Societal concept=
considering consumers' wants, the company's requirements, consumers' long-term interests, society's long-run interests
Preparing an Integrated Marketing Plan and Program
Marketing mix=4Ps to implement marketing strategy
Product
Price
Promotion
Place
Integrated Marketing program= communicated+delivers the intended value to chosen customers
Building Customer Relationships
Customer relationship management (CRM)
process of building, maitaining profitable customer relationships by delivering superior value, satisfaction
Customer perceived value= difference between total customer value and total customer cost
Customer satisfaction= product's perceived performance matches buyer's expectations
Customer Relationship Levels and Tools
Customer Relationship Levels and Tools
Full relationships
Frequency marketing programs
Club marketing programs
The changing nature of customer relationships
Relating with more carefully selected customers=target fewer, more profitable customers
Relating for the long term= retain current customers, build profitable, long-term relationships
Relating directly= use direct marketing tools to make direct connections with customers
Partner Relationship Manangement
Partner inside the company= every function area interacting with customers
Partner outside the company= how marketers connect with supplier, channel, partners, competitors
Supply chain= channel, raw materials to components to final products to final buyers
Strategic alliances
Supply management
Strategic partners
Capturing value from customers
Creating lifetime value = customer would make over a lifetime of patronage
Growing share of customer
Share of customer= customer's purchasing that a company gets in its product categories
Building Customer Equity
Customer equity= total customer lifetime value of all oft he company's customers
Building the right relationships with the right customers
The new marketing landscape
Major developments
Ethics & social responsibility
Digital age
Globalization
Not-for-profit marketing
The new digital age: major impact on the ways marketers connect, bring value to customers
Market research
Create new customized products
Distribution
Communication
Video conferencing
Online data services
Internet
creates marketplaces, marketspaces
Communication
Information
Entertainment
Rapid Globalization
The world is smaller
Think global, act locally
The call for more ethics and social responsibility= responsibility for the social, environmental impact of their actions in a global economy
Social marketing campaigns= encourage, concern for the environment/ disscourage smoking, excessive drinking, drug use
The growth for not-for-profit marketing
Orchestras
Museums
Colleges
Hospitals
Zoos
Religious groups